Semiconductor Manufacturing International Corp, the largest contract chip maker in mainland China, has signed a cooperation agreement with Wuhan East Lake Hi-Tech Development Zone Administrative Committee to jointly invest in Wuhan Xinxin Semiconductor Manufacturing Corp’s 12-inch wafer production facilities, HKTDC reported.

The city government will cooperate with SMIC in areas such as talent training and chip design. Wuhan Xinxin will mainly produce the most advanced products on the Chinese market, the 40- to 65-nanometer chips. The plant is expected to have a monthly production capacity of 45,000 wafers by the end of 2013, nine times the existing production capacity.

Wuhan government and Wuhan East Lake Hi-Tech Development Zone Administrative Committee jointly funded Wuhan Xinxin in 2006 to build the first 12-inch wafer production facilities in central China. The first phase of the project was put into operation in 2008 with an investment of Rmb10bn, but it has yet to become profitable.