Authorities from Shantou government, Shantou University and the Israel Institute of Technology signed a framework agreement on Friday to build a new technology institute in Shantou, Guangdong province.

The Li Ka-shing Foundation has given the joint academic venture $130 million to set up the Technion Guangdong Institute of Technology, sources with the local government said.

The agreement was signed on Friday during the annual East Guangdong Overseas Chinese Expo, which opened in Shantou, a coastal city in eastern Guangdong.

The institute will begin offering students undergraduate programs in civil and environmental engineering and computer sciences from next year, according to Gu Peihua, president of Shantou University.

Gu described the partnership as a "major breakthrough in social reform and an opportunity to help accelerate the local government's plan to upgrade traditional industries," Gu said.

"The joint institute will help boost academic and scientific cooperation between China and Israel. More importantly, it will be very helpful to push development of innovation and technology in Shantou."

Shantou, one of the special economic zones in South China, has been relying on traditional industries such as textiles, toys and gifts for its economic development for decades.

"What Technion has done to advance the Israeli economy through student and staff research and innovation is an example for Chinese universities to follow," Gu said.

Beginning in 2014, the institute will join Shantou University to conduct life sciences research to tackle the pressing social and livelihood issues such as an inadequate healthcare system and services, as well as improvements in clinical diagnosis procedures.

By 2020, the institute will offer courses in other engineering-related fields, from mechanical to aerospace engineering, according to a news release from Israel's prestigious Technion.

"The establishment of an innovation center, connecting industries in Guangdong with Israel's technological creativity, will bring Israeli technology into China and promote joint research and innovation," Gu said.