In a significant development, US chipmaker Intel has decided to cancel its plans to construct a $25 billion factory in Israel. This information was reported by the UK news agency Reuters on Tuesday, June 11, citing the Israeli financial newspaper Calcalist.

Intel has not provided a definitive confirmation or denial regarding the cancellation of the factory plans. The company did indicate that major projects could evolve over time, although this was not explicitly linked to the Israeli project.

"Israel plays an important role in our global manufacturing and research, and we remain fully committed to the region," Intel said in a statement. The company emphasized its ongoing commitment despite the recent decision.

Intel currently operates four development and manufacturing sites in Israel. One of these is the 'Fab 28' manufacturing plant in Kiryat Gat, which produces Intel-7 technology or 10 nanometer chips. The new plant, 'Fab 38,' was scheduled to be built by 2028, but this plan has now been shelved. Intel employs approximately 1,200 people in Israel, highlighting the country’s importance in its global operations.

The cancellation of the factory project marks a significant shift in Intel's strategic plans, potentially impacting its expansion and technological advancements in the region.