A Chinese company is expected to deliver its first locally designed DRAM chip by the end of this year, marking a major breakthrough in the country’s ambition to become technologically self-sufficient.

ChangXin Memory Technologies, a state-backed chip startup founded in 2016 in the eastern city Hefei, has started production of 8GbDDR4 chip, Chairman and Chief Executive Officer Zhu Yiming said Friday at the World Manufacturing Convention in Hefei.

The chip, though it still lags behind products of international giants, has been verified by a number of major clients at home and abroad. With the commercial production of this chip, China would be able to replace imported products in the middle and low-end areas, a senior industry participant said.

The chip project has a total investment of about 150 billion yuan ($21 billion), with a designed capacity of 120,000 chips a month in the first phase of production. Zhu said in May that the company has spent $2.5 billion on research, development and capital facilities.

Contact reporter Denise Jia (huijuanjia@caixin.com)