China's Semiconductor Manufacturing International Corporation (SMI) held a foundation-laying ceremony for two production lines and an R&D center in Shenzhen this past weekend.

SMIC says it will set up SMIC (Shenzhen) in the city, and the project will involve USD1.58 billion in investment, consisting of an IC R&D center and two production lines for 8-inch and 12-inch wafers, respectively.

The first-phase construction of the 8-inch production line is slated to be completed at the end of 2009 with an initial monthly output of 30,000 to 50,000 wafers, and at that time the second phase of the 12-inch wafers production line, which will use IBM's technology, will commence.

Xu Zongheng, mayor of Shenzhen, says that SMIC's establishment of the production lines in Shenzhen will make up for the shortages in the electronic information industry chain of the entire South China while allowing Shenzhen ascend to the forefront of the development of the IC industry in China and increasing the core competitiveness of the city's high tech industry.