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Intel to build additional plant in Israel

Israeli Prime Minister Ariel Sharon told cabinet ministers in Jerusalem on Sunday that he had been informed by Intel`s head that the U.S. electronic chip giant plans to build another plant in Israel, CNET reported on Sunday.

"I spoke yesterday with the head of Intel, Craig Barrett, who informed me the company had decided to build another plant in Kiryat Gat in an investment of about $4 billion," Sharon was quoted as telling the cabinet meeting in a statement issued by his office.

The prime minister`s office, together with the Industry and Trade Ministry and the Finance Ministry, have put together a framework for government aid to Intel to set up the plant, the Industry and Trade Ministry said in a separate statement.The ministry said its investment center would give a grant of 15 percent of the investment up to $3.5 billion, for a total of $525 million. Finance Minister Benjamin Netanyahu said in a statement that the government in 2001 had originally agreed to give a grant to Intel of 12.5 percent of the investment but recently Intel had asked the state to raise its grant to 20 percent.

"The compromise of 15 percent is worth an additional $90 million. The grant is subject to a professional survey," Netanyahu said.

The plant, which several countries around the world have been lobbying for, will employ 2,000 workers in Kiryat Gat - already home to another factory that makes Pentium processors and other Intel chips such as the Centrino chip which was developed in Israel. Intel employs nearly 6,000 people in a number of chip-manufacturing plants and development centers in Israel. The company has been operating in Israel for 30 years.

"I see in this decision a declaration of complete faith in Israel`s economic policy and stability," Sharon said.