Israel Aims to Attract 2nm Chip Fabs and Build Large AI Data Center
Israel's National AI Director, Erez Askal, is actively lobbying TSMC, Samsung, and Intel to build advanced 2nm logic chip fabs in the country. Additionally, he plans to establish a massive data center cluster equipped with 100,000 GPUs within the next five years. Securing a 2nm fab would position Israel at the forefront of global semiconductor manufacturing and support its domestic AI ambitions. However, achieving this is highly challenging due to ongoing geopolitical conflicts and severe local power grid constraints. Intel already operates Fab 28 (Intel 7) in Israel, but its planned Fab 38 expansion was frozen in 2024 due to financial difficulties. Furthermore, the Israel Electricity Authority has suspended new data center applications for the year due to a massive 27GW backlog.
## BACKGROUND
The 2nm process represents the next major frontier in semiconductor manufacturing, offering significant performance and power efficiency gains over older nodes. Intel 7 is a 10nm-class process node developed by Intel, which was rebranded in 2021 to better align with industry naming standards.