The Shanghai Municipal Government has signed a strategic cooperative framework agreement with the Datang Telecom Technology and Industry Group.

In conjunction with the signing of the deal, Datang Telecom Group will formally invest in Semiconductor Manufacturing International Corporation, a Shanghai-based manufacturer of chips.

Under the agreement, Datang Telecom Group will also make Shanghai an important industrial development base for the company; set up Datang Holding Shanghai Industrial Park; enhance the development of chips based on the TD-SCDMA technology and terminal solutions; fully support SMIC's entry into the TD-SCDMA industry; further cooperate with universities and research units in Shanghai; improve the competitive power of Chinese TD-SCDMA and integrated circuit industries in the international markets; and lend support to Shanghai's high-tech industrialization plans.

In regards to the signing of this agreement, Ai Baojun, vice mayor of Shanghai, says that this agreement will benefit the development of informatization and advanced manufacturing industries. With the investment relationship between Datang and SMIC, the two sides will use their respective advantages and contribute to the development of the industry.

Zhen Caiji, chairman and president of Datang Telecom Group, says Datang Holding will fully support SMIC's entry into the TD-SCDMA industry and help SMIC to develop rapidly in the industry. In return, SMIC will further aid Datang Holding in its improvements of research and manufacturing capacity of TD-SCDMA chips.