XI'AN - Samsung Electronics, a leading global memory chip maker, will build a memory chip plant in the northwestern Chinese city of Xi'an with an investment of $7 billion.

The plant, to be located in the High-tech Industries Development Zone of Xi'an, capital of Shaanxi province, will manufacture 100,000 memory chips per month after it goes into operation at the end of 2013, according to an agreement signed between Samsung and the development zone.

Samsung executives said they chose Xi'an as the new plant site because the city has favorable infrastructure, excellent public services and abundant labor.

Zhao Zhengyong, governor of Shaanxi, said at the signing ceremony that the plant is expected to boost local economic development and create many jobs.

"More than 1,200 people will work in the new plant. In addition, 17,000 people will offer different kinds of services for the business," he said.

With the construction of the Samsung plant, more than 160 supporting businesses are expected to start operation in the development zone, he added.