The city of Phoenix expects that thousands of jobs will come to the city after the City Council approved a deal with Taiwan Semiconductor Manufacturing Company (TSMC).

The council unanimously approved the $12 billion agreement with the company during a recent formal meeting. TSMC will build an advanced semiconductor fabrication plant to produce its 5-nanometer technology for semiconductor wafer. The $12 billion figure represents direct capital investment while the total economic effect of the deal is estimated at $16 billion. Besides being a record-setting pact for the city, it also is among the largest private investments in Arizona’s history.

Phoenix Mayor Kate Gallego said the company will create 1,900 high-tech jobs and cultivate thousands more related positions in the semiconductor supply chain ecosystem.

Initial talks with TSMC started several years ago and Gallego visited Taiwan last year to strengthen relationships and advance the deal.

TSMC is expected to choose a site for the plant late this year and to start construction on it in early 2021. The plant is likely to be in production by 2024.