Sources say government has offered Intel a sliding scale of grants: $200 million if it only expands its current Israeli plant, rising to $1 billion if it builds new plant. The Israelis want Intel to upgrade its plant in Kiryat Gat and build a new one next door. The money mean the Israeli government will cover somewhere between four to ten per cent of the overall cost.

Israel is engaged in a global competition to play home to Intel’s next-generation production facilities. A lot is at stake, as the American company’s Kiryat Gat plant is a major source of export earnings for the country, as well as a major employer.

In 2012, Intel Israel’s exports more than doubled to $4.6 billion, or 10% of the country’s total industrial exports, while employing some 8,500 people.