The aerospace industry is expected to one day become the new growth engine of Shenzhen's economy with the establishment of a satellite manufacturing company on Sunday.

Upon completion, Shenzhen Aerospace Spacesat Co. Ltd. is expected to develop six to eight types of satellites and produce four to five satellites every year. The satellites will be used for global navigation, telecommunications, remote sensing and space exploration.

The enterprise was jointly founded by China Spacesat Co. Ltd., Harbin Institute of Technology and Shenzhen Aerospace Science and Technology Research Institute. It will be part of a research, development and manufacturing base for the aerospace industry in Shenzhen, company officials said Sunday.

A research institute subordinate to China Aerospace Science and Technology Corp., the main contractor for the Chinese space programs, will also move into the base in Shenzhen.

On Sunday, national and city government officials broke ground for the Satellite Building, an infrastructure project at the base in the Shenzhen Hi-Tech Industrial Park.

Costing 160 million yuan (23.39 million U.S. dollars), the 250,000-square-meter building will be used for research, development, designing, packing, testing and manufacturing related to satellites.

"Shenzhen has always attached great importance to the aerospace industry, which can gradually become the new growth engine of the city's economy," said Mayor Xu Zongheng. "With the backdrop of the global financial crisis, this new project can turn challenges into opportunities with the joint efforts of the three parties involved."

An aerospace industry chain will be formed in Shenzhen after the research institute of China Aerospace Science and Technology Corp. moves into the base, analysts said.

The base in Shenzhen will also be capable of developing and testing some core components and accessories of satellites, according to Ma Xingrui, general manager of China Aerospace Science and Technology Corp.

It was reported previously that the State-owned company will gradually move its core business of space manufacturing and aerospace technology applications to Shenzhen.