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                                                                    Exhibit 10.8

              SEMICONDUCTOR MANUFACTURING INTERNATIONAL CORPORATION
                             2004 STOCK OPTION PLAN

     SMIC hereby establishes this Plan to be known as the "SMIC 2004 Stock
Option Plan" as a component of its Global Equity Program. The Plan shall become
effective on the date it is approved by the shareholders of SMIC, following its
approval by the Board in accordance with Section 4 hereof. Capitalized terms
that are not otherwise defined in the text of this Plan are defined in Section 2
below.

1.   Purposes

     The purposes of the Plan are to attract, retain and motivate employees and
directors of, and other service providers to, the Company; to provide a means on
and after the Public Offering of compensating them through the grant of Stock
Options for their contributions to the growth and profits of the Company; and to
allow such employees, directors and service providers to participate in such
growth and profitability.

2.   Definitions

     For purposes of the Plan, the following terms shall be defined as follows:

          "Administrator" means the individual or individuals to whom the
     Committee delegates authority under the Plan in accordance with Section
     3(d).


          "ADS" means an SMIC American Depositary Share, each of which
     represents fifty (50) Common Shares.


          "Annual Meeting" means an annual general meeting of the SMIC
     shareholders.

          "Award Document" means a written document approved in accordance with
     Section 7 hereof which sets forth the terms and conditions of a grant of a
     Stock Option to a Participant. An Award Document may be in the form of (i)
     an agreement between the Company and a Participant which is executed by an
     officer on behalf of the Company and is signed by the Participant or (ii) a
     certificate issued by the Company which is executed by an officer on behalf
     of the Company but does not require the signature of the Participant. An
     Award Document may be in written, electronic or other form that the
     Committee determines is sufficient to memorialize the terms and conditions
     of the applicable Stock Option.

          "Board" means the Board of Directors of SMIC.

          "Business Day" means a day on which the applicable exchange is open
     for trading of securities.

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          "Cause" means the termination of a Participant's employment with the
     Company as a consequence of "cause," as such term or any similar term is
     defined in any employment agreement between the Company and the Participant
     or, if there is no such employment agreement in effect at the time of the
     Participant's termination of employment:

               (i)   the failure or refusal of the Participant to substantially
          perform the duties required of him or her as an employee of, or
          service provider to, the Company;

               (ii)  any material violation by the Participant of any law or
          regulation applicable to any business of the Company, or the
          Participant's conviction of, or a plea of nolo contendere to, a
          felony, or any perpetration by the Participant of a common law fraud
          against the Company; or

               (iii) any other misconduct by the Participant that is materially
          injurious to the financial condition, business or reputation of the
          Company.

          "Change in Control" shall mean, with respect to any period on or after
     a Public Offering, any of the following:

               (i)   the acquisition by any Person of beneficial ownership
          (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
          of 35% or more of the then outstanding shares of SMIC entitled to vote
          in the election of the directors of the Board, but shall not include
          any such acquisition by any employee benefit plan of the Company, or
          any Person organized, appointed or established by the Company for or
          pursuant to the terms of any such employee benefit plan;

               (ii)  consummation after approval by the shareholders of either
          (A) a plan of complete liquidation or dissolution of SMIC or (B) a
          merger, amalgamation or consolidation of SMIC with any other
          corporation, the issuance of voting securities of SMIC in connection
          with a merger, amalgamation or consolidation of SMIC or sale or other
          disposition of all or substantially all of the assets of SMIC or the
          acquisition of assets of another corporation (each, a "Business
          Combination"), unless, in each case of a Business Combination,
          immediately following such Business Combination, all or substantially
          all of the individuals and entities who were the beneficial owners of
          the Common Shares outstanding immediately prior to such Business
          Combination beneficially own, directly or indirectly, more than 50% of
          the then outstanding Common Shares and 50% of the combined voting
          power of the then outstanding voting securities entitled to vote
          generally in the election of directors, as the case may be, of the
          entity resulting from such Business Combination (including, without
          limitation, an entity which as a result of such

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          transaction owns the Company or all or substantially all of SMIC's
          assets either directly or through one or more subsidiaries) in
          substantially the same proportions as their ownership, immediately
          prior to such Business Combination, of the Common Shares; or

               (iii) the individuals who, as of the effective date of the Plan,
          constitute the Board, and subsequently elected directors of the Board
          whose election is approved or recommended by at least a majority of
          such current members or their successors whose election was so
          approved or recommended (other than any subsequently elected members
          whose initial assumption of office occurs as a result of an actual or
          threatened election contest with respect to the election or removal of
          directors or other actual or threatened solicitation of proxies or
          consents by or on behalf of a Person other than the Board), cease for
          any reason to constitute at least a majority of such Board.

          "Code" means the U.S. Internal Revenue Code of 1986, as amended, and
     the applicable rulings and regulations thereunder.

          "Committee" means the Compensation Committee of the Board, any
     successor committee thereto or any other committee appointed from time to
     time by the Board to administer the Plan.


          "Common Shares" means ordinary shares in the capital of SMIC, par
     value $0.0004.


          "Company" means, individually and collectively, SMIC and its
     Subsidiaries.

          "Director Option" means a Non-Qualified Stock Option granted to a
     Non-Employee Director.

          "Eligible Individuals" means the individuals described in Section 6
     who are eligible for Stock Options under the Plan.


          "ESPP" means the Semiconductor Manufacturing International Corporation
     2004 Employee Stock Purchase Plan.


          "Exchange Act" means the U.S. Securities Exchange Act of 1934, as
     amended, and the applicable rulings and regulations thereunder.

          "Fair Market Value" of (i) a Common Share means the higher of (A) the
     closing price of the Common Shares on the Hong Kong Exchange (as stated in
     its daily quotations sheet) on the applicable date of grant (which must be
     a Business Day) and (B) the average closing price of the Common Shares on
     the Hong Kong Exchange (as stated in the relevant daily quotations sheets
     of the Hong Kong

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     Exchange) for the five Business Days immediately preceding the date of
     grant and (ii) an ADS means the higher of (A) the closing price of the ADSs
     on the NYSE on the applicable date of grant and (B) the average closing
     price of the ADSs on the NYSE for the five Business Days immediately
     preceding the date of grant. Notwithstanding the foregoing, the Fair Market
     Value of Plan Shares for purposes of grants of Incentive Stock Options
     shall be determined in compliance with applicable provisions of the Code.

          "Global Equity Program" means collectively this Plan, the SMIC Equity
     Incentive Plan and the SMIC Employee Stock Purchase Plan.

          "HK Listing Rules" means the Rules Governing the Listing of Securities
     on The Stock Exchange of Hong Kong Limited.

          "Hong Kong Exchange" means The Stock Exchange of Hong Kong Limited.

          "Incentive Stock Option" means a Stock Option that is an "incentive
     stock option" within the meaning of Section 422 of the Code and designated
     by the Committee as an Incentive Stock Option in an Award Document.

          "Non-Employee Director" means a member of the Board who is not then an
     officer or employee of the Company.

          "Non-Qualified Stock Option" means a Stock Option that is not an
     Incentive Stock Option.

          "NYSE" means the New York Stock Exchange, Inc.

          "Participant" means an Eligible Individual to whom a Stock Option has
     been granted under the Plan.

          "Person" means any person, entity or "group" within the meaning of
     Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, except that such
     term shall not include (i) SMIC or any Subsidiary thereof; (ii) a trustee
     or other fiduciary holding securities under an employee benefit plan of the
     Company; (iii) an underwriter temporarily holding securities pursuant to an
     offering of such securities; or (iv) an entity owned, directly or
     indirectly, by the shareholders in substantially the same proportions as
     their ownership of stock of SMIC.

          "Plan" means this SMIC 2004 Stock Option Plan.

          "Plan Shares" means, as applicable, the Common Shares or ADSs.

          "Public Offering" means a public offering of the Common Shares
     pursuant to an effective registration statement under the Securities Act.

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          "Public Offering Date" means the effective date of the Public
     Offering.

          "Purchase Right" has the same meaning given to it under the ESPP.

          "Securities Act" means the U.S. Securities Act of 1933, as amended,
     and the applicable rulings and regulations thereunder.

          "SMIC" means Semiconductor Manufacturing International Corporation, a
     limited liability company incorporated under the laws of the Cayman
     Islands, and any successor thereto.

          "SMIC Employee Stock Purchase Plan" means the Semiconductor
     Manufacturing International Corporation 2004 Employee Stock Purchase Plan.

          "SMIC Equity Incentive Plan" means the Semiconductor Manufacturing
     International Corporation 2004 Equity Incentive Plan.

          "Stock Option" means a right granted to an Eligible Individual
     pursuant to this Plan to purchase Plan Shares, which Stock Option may be an
     Incentive Stock Option, a Non-Qualified Stock Option or a Director Option.

          "Subsidiary" means (i) a corporation or other entity with respect to
     which SMIC, directly or indirectly, has the power, whether through the
     ownership of voting securities, by contract or otherwise, to elect at least
     a majority of the members of such corporation's board of directors or
     analogous governing body, (ii) any other corporation or other entity in
     which SMIC, directly or indirectly, has an equity or similar interest and
     which the Committee designates as a Subsidiary for purposes of the Plan and
     (iii) any successor to any such entity that satisfies the requirements of
     clause (i) or (ii) hereof; provided, however, that for purposes of any
     grant of Incentive Stock Options, a Subsidiary shall be defined in
     accordance with the applicable provisions of the Code.

3.   Administration of the Plan

          (a)    Power and Authority of the Committee. The Plan shall be
administered by the Committee, which shall have full power and authority,
subject to the express provisions hereof:

          (i)    to select Participants from the Eligible Individuals;

          (ii)   to grant Stock Options in accordance with the Plan and to issue
          Plan Shares;

          (iii)  to determine the number of Plan Shares subject to each Stock
          Option;

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          (iv)   to determine the terms and conditions of each Stock Option,
     other than the terms and conditions that are expressly required by the
     Plan;

          (v)    to specify and approve the provisions of the Award Document;

          (vi)   to construe and interpret any Award Document;

          (vii)  to prescribe, amend and rescind rules and procedures relating
     to the Plan;

          (viii) to vary the terms of Stock Options to take account of tax,
     securities law and other regulatory requirements of the various
     jurisdictions applicable to Participants;

          (ix)   to employ such legal counsel, independent auditors and
     consultants as it deems desirable for the administration of the Plan and to
     rely upon any opinion or computation received therefrom; and

          (x)    to make all other determinations and to formulate such
     procedures as may be necessary or advisable for the administration of the
     Plan.

          (b)    Plan Construction and Interpretation. The Committee shall have
full power and authority, subject to the express provisions hereof, to construe
and interpret the Plan. Except as expressly provided herein, in the event of any
conflict or inconsistency between the Plan and any Award Document, the Plan
shall govern, and the Award Document shall be interpreted to minimize or
eliminate any such conflict or inconsistency.

          (c)    Determinations of Committee Final and Binding. All
determinations by the Committee in carrying out and administering the Plan and
in construing and interpreting the Plan shall be final, binding and conclusive
for all purposes and upon all persons interested herein.

          (d)    Delegation of Authority. The Committee may, but need not, from
time to time delegate some or all of its authority under the Plan to an
Administrator consisting of one or more members of the Committee or of one or
more officers of the Company; provided, however, that the Committee may not
delegate its authority (i) to grant Stock Options to Eligible Individuals who
are executive officers of the Company or who are delegated authority by the
Committee hereunder or (ii) under Sections 3(b) and 9(a), (e) and (f) of the
Plan. Any delegation hereunder shall be subject to the restrictions and limits
that the Committee specifies at the time of such delegation or thereafter.
Nothing in the Plan shall be construed as obligating the Committee to delegate
authority to an Administrator, and the Committee may at any time rescind the
authority delegated to an Administrator appointed hereunder or appoint a new
Administrator. At all times, the Administrator appointed under this Section 3(d)
shall serve in such capacity at the pleasure of the Committee. Any action
undertaken by the Administrator in accordance with the Committee's delegation of
authority shall have the same force and effect as if undertaken


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directly by the Committee, and any reference in the Plan to the Committee shall,
to the extent consistent with the terms and limitations of such delegation, be
deemed to include a reference to the Administrator.

          (e)    Limitation on Liability of the Committee. No member of the
Committee shall be liable for any action or determination made in good faith,
and the members of the Committee shall be entitled to indemnification and
reimbursement in the manner provided in SMIC's Articles of Association as they
may be amended from time to time. In the performance of its responsibilities
with respect to the Plan, the Committee shall be entitled to rely upon
information and advice furnished by the Company's officers, the Company's
accountants, the Company's counsel and any other party the Committee deems
necessary, and no member of the Committee shall be liable for any action taken
or not taken in reliance upon any such advice. The provisions of this Section
3(e) shall apply to the Committee and to each Administrator designated by the
Committee.

          (f)    Action by the Board. Anything in the Plan to the contrary
     notwithstanding:

          (i)    The Board shall exercise all authority and responsibility with
     respect to Director Options unless otherwise required by HK Listing Rules.

          (ii)   Any authority or responsibility that, under the terms of the
     Plan, may be exercised by the Committee, may alternatively be exercised by
     the Board, unless such exercise of authority by the Board would contravene
     applicable law or the rules of the principal exchange on which the Common
     Shares or ADS, as applicable, are then listed for trading.

4.   Effective Date and Term

          The Plan shall become effective when approved by the shareholders of
SMIC, following its approval by the Board; provided, however, that no grants of
Stock Options shall be made under the Plan with a grant date prior to the Public
Offering Date. In no event shall any Stock Options be granted under the Plan
after the tenth anniversary of the date of shareholder approval.

5.   Common Shares Subject to the Plan

          (a)    Global Limit. The number of Common Shares that may be issued
pursuant to this Plan and the ESPP (the "Global Limit") shall be 1,317,000,000.
If Stock Options and Purchase Rights granted respectively under the SMIC Stock
Option Plan and this Plan exceed this limit, the Company may seek shareholders'
approval in order to refresh such limit, subject to the thirty percent (30%)
limit described herein. In no event may the number of Common Shares that may be
issued pursuant to any outstanding Stock Option granted under this Plan or other
stock option plan of the Company or any outstanding Purchase Right


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granted under the ESPP or any other employee stock purchase plan of the Company
exceed, in the aggregate, thirty percent (30%) of the issued and outstanding
Common Shares in issuance from time to time.


          (b)    Application to ADSs. For purposes of calculating the number of
Common Shares issued under the Global Limit (and for purposes of calculating any
other limit set forth herein), the issuance of an ADS shall be deemed to be
equal to a number of Common Shares determined by multiplying (i) the number of
ADSs issued under the Global Limit by (ii) the ADS Multiplier. For purposes of
the previous sentence, "ADS Multiplier" means the number of Common Shares
corresponding to one (1) ADS.


          (c)    Individual Limit. The total number of Common Shares underlying
Stock Options granted by the Company pursuant to this Plan or any other stock
option plan of the Company to, and the total number of Common Shares that may be
purchased under one or more Purchase Rights granted under the ESPP or any other
employee stock purchase plan of the Company by, a Participant (including both
exercised and outstanding Stock Options) in any twelve-month period may not
exceed at any time one percent (1%) (or 0.1% in the case of an "independent
non-executive director" (as that term is used in the HK Listing Rules) of the
then issued and outstanding Common Shares unless otherwise allowed under the HK
Listing Rules.

6.   Eligible Individuals

     Stock Options may be granted by the Committee to Eligible Individuals who
are employees, officers or other service providers of the Company located in
China, the United States or elsewhere, or to a trust established in connection
with any employee benefit plan of the Company (including the Plan) for the
benefit of any of the foregoing; provided, however, that Incentive Stock Options
may be granted only to employees of the Company. An individual's status as an
Administrator will not affect his or her eligibility to participate in the Plan.
Director Options shall also be granted to Non-Employee Directors in accordance
with Section 8 below.

7.   Terms of Stock Options Generally

          (a)    Grant. A Stock Option shall entitle the Participant to whom the
Stock Option was granted to purchase a specified number of Plan Shares during a
specified period at a price that is determined in accordance with Section 7(c)
below. The terms and provisions of Stock Options shall be set forth in a written
Award Document approved by the Committee and delivered or made available to the
Participant as soon as practicable following the date of grant. The terms of
Stock Options may vary among Participants, and the Plan does not impose upon the
Committee any requirement to grant Stock Options subject to uniform terms.
Accordingly, the terms of individual Award Documents may vary between and among
Participants.

          (b)    Vesting. Unless otherwise specified in the applicable Award
Document, a Stock Option shall become vested upon the occurrence of applicable
vesting dates or the attainment of specified performance goals over a period of
time determined by the Committee and set forth in the applicable Award Document.
Notwithstanding the

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foregoing, the Company may allow a Participant to exercise Stock Option prior to
vesting, subject to the applicable Participant's agreement to appropriate
repurchase and other rights of the Company. In addition, the Committee may
accelerate (i) the vesting of a Stock Option or (ii) the date on which any Stock
Option first becomes exercisable, and, further, may extend the period during
which a Stock Option remains exercisable (except that no Stock Options may be
exercised after the tenth anniversary of the date of grant thereof).

          (c)    Exercise Price. The exercise price per Plan Share purchasable
under a Stock Option shall be fixed by the Committee at the time of grant or,
alternatively, shall be determined by a method specified by the Committee at the
time of grant, but in no event shall be less than the Fair Market Value of a
Plan Share on the date such Stock Option is granted. Except as provided in
Section 5 above, the exercise price per Plan Share applicable to a Stock Option
may not be reduced, including by means of amendment, cancellation or the
replacement of such Stock Option with a subsequently awarded Stock Option,
unless such reduction is approved by the shareholders of SMIC in accordance with
applicable law.

          (d)    Term. The term of each Stock Option shall not exceed ten years
from the date of grant.


          (e)    Method of Exercise. In accordance with the rules and procedures
established by the Committee for this purpose, and subject to the provisions of
the applicable Award Document, the exercise price of a Stock Option may be paid
in cash or previously owned Plan Shares or a combination thereof and, if the
applicable Award Document so provides, and arrangements have been made for the
paying up in full at the par value of the Plan Shares to be issued, in whole or
in part through the withholding of Plan Shares subject to the Stock Option with
a market value equal to the aggregate exercise price of the portion of the Stock
Option subject to exercise. In accordance with the rules and procedures
established by the Committee for this purpose, the Stock Option may also be
exercised through a "cashless exercise" procedure, approved by the Committee,
involving a broker or dealer, that affords Participants the opportunity to sell
immediately some or all of the Plan Shares underlying the exercised portion of
the Stock Option in order to generate sufficient cash to pay the Stock Option
exercise price and to satisfy withholding tax obligations related to the Stock
Option.


          (f)    Termination of Employment. The Committee shall include terms in
the Award Document to govern the effect that termination of a Participant's
employment with the Company shall have on the Stock Option, subject to the
following:

          (i)    Term. In no event shall any Stock Option be exercised on or
after the end of the applicable term of the Stock Option.

          (ii)   Termination for Cause. In the event that a Participant's
employment or service with the Company is terminated for Cause, all Stock
Options, whether or not then vested, shall be immediately forfeited.

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          (iii)  Divestiture of Subsidiary, Division or Operating Unit. The sale
or other divestiture of a Subsidiary, division or operating unit of the Company
shall, for all purposes of the Plan, be treated as a termination of employment
with respect to Stock Options held by the Participants employed by such
Subsidiary, division or operating unit.

          (iv)   Service Providers Other Than Employees. When a Stock Option is
granted to a service provider to the Company who is not an employee, reference
in the Plan and the Award Document to "termination of employment" or similar
terms shall be deemed to refer to termination of such service relationship as
determined by the Committee.

          (v)    Conversion of Incentive Stock Option. The Committee may permit
any Incentive Stock Option to convert into a Non-Qualified Stock Option as of a
Participant's termination of employment for purposes of providing such
Participant with the benefit of any extended exercise period applicable to
Non-Qualified Stock Options.

8.   Director Options

          (a)    Grants of Director Options.

          (i)    Discretionary Grants. Subject to Section 8(a)(ii) below, a
Director Option shall entitle the Non-Employee Director to whom the Director
Option was granted to purchase a specified number of Plan Shares during a
specified period at a price that is determined in accordance with Section 8(b)
below. The terms and provisions of Director Options shall be set forth in a
written Award Document approved by the Board and delivered or made available to
the Non-Employee Director as soon as practicable following the date of grant.
The terms of Director Options may vary among Non-Employee Directors, and the
Plan does not impose upon the Board any requirement to grant Director Options
subject to uniform terms. Accordingly, the terms of individual Award Documents
may vary between and among Non-Employee Directors.

          (ii)   Hong Kong Black-Out Period. Notwithstanding anything contained
in the Plan or in any Award Document to the contrary, if the grant of any
Director Options would be prohibited due to the laws of Hong Kong that prohibit
any dealings during the period commencing one month immediately prior to the
earlier of (a) the date of the meeting of the Board for the approval of the
Company's interim or annual results and (b) the deadline under the HK Listing
Rules to publish its interim or annual announcement, and ending on the date of
the results announcement (the "Hong Kong Black-Out Period"), the date of grant
of such Director Options shall be the first Business Day following the end of
the Hong Kong Black-Out Period.

          (b)    Terms and Conditions of Director Options

          (i)    Exercise Price. The exercise price per Plan Share subject to
each Director Option provided for in this Section 8 shall be the Fair Market
Value on the relevant date of grant.

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          (ii)   Option Term. Each Director Option shall expire on the tenth
anniversary of the date of grant, subject to earlier expiration as provided
herein.

          (iii)  Vesting. Subject to the terms and conditions in Section 8(a)
(ii) above, a Director Option shall become vested upon the occurrence of
applicable vesting dates as set forth in the applicable Award Document; provided
that, the Non-Employee Director has remained in service as a director through
the vesting date. In addition, the Board may accelerate (i) the vesting of a
Director Option or (ii) the date on which any Director Option first becomes
exercisable, and, further, may extend the period during which a Director Option
remains exercisable (except that no Director Options may be exercised after the
tenth anniversary of the date of grant thereof).

          (iv)   Exercise Following Termination of Service. Following
termination of a Non-Employee Director's service on the Board, the former
Non-Employee Director (or the former Non-Employee Director's estate, personal
representative or beneficiary, as the case may be) shall have the right, subject
to the other terms and conditions hereof, to exercise all Director Options that
had vested as of the date of termination of service with the Board during the
120 day period following such termination of service. Unless the Board
determines otherwise, the unvested portion of a Director Option shall be
forfeited in full if the director's service with the Board ends for any reason
prior to the applicable vesting date.

9.   Certain Restrictions

          (a)    Transfers. Unless the Committee determines otherwise, no Stock
Option shall be transferable other than by will or by the laws of descent and
distribution or pursuant to a domestic relations order; provided, however, that
the Committee may, in its discretion and subject to such terms and conditions as
it shall specify, permit the transfer of a Stock Option for no consideration to
a Participant's family members or to one or more trusts or partnerships
established in whole or in part for the benefit of one or more of such family
members (collectively, "Permitted Transferees"). Any Stock Option transferred to
a Permitted Transferee shall be further transferable only by will or the laws of
descent and distribution or, for no consideration, to another Permitted
Transferee of the Participant.

          (b)    Stock Option Exercisable Only by Participant. During the
lifetime of a Participant, Stock Option shall be exercisable only by Participant
or by a Permitted Transferee to whom such Stock Option has been transferred in
accordance with Section 9(a). The grant of a Stock Option shall impose no
obligation on a Participant to exercise or settle the Stock Option.

          (c)    Lock-up Periods. Each Participant shall agree to be bound by
the applicable terms of any lock-up agreement between the Company and any
underwriter that restricts or prohibits transactions in Plan Shares for any
period of time.

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          (d)    Authority of the Company and Shareholders. The existence of the
Plan, the Award Documents and the Stock Options granted hereunder shall not
affect or restrict in any way the right or power of the Company or the
shareholders of the Company to make or authorize any adjustment,
recapitalization, reorganization or other change in the Company's capital
structure or its business, any merger or consolidation of the Company, any issue
of stock or of options, warrants or rights to purchase stock or of bonds,
debentures, preferred or prior preference stocks whose rights are superior to or
affect the Common Shares or the rights thereof or which are convertible into or
exchangeable for Common Shares, or the dissolution or liquidation of the
Company, or any sale or transfer of all or any part of its assets or business,
or any other corporate act or proceeding, whether of a similar character or
otherwise.

          (e)    Change in Control. The Committee may specify at or after the
date of grant of a Stock Option the effect that a Change in Control will have on
such Stock Option. Such Committee discretion may include one or more of the
following: (i) shortening the period during which Stock Options are exercisable
(provided they remain exercisable for at least thirty days after the date notice
of such shortening is given to the Participants); (ii) accelerating any vesting
schedule to which a Stock Option is subject or waive, in whole or in part, any
performance conditions to such vesting; (iii) arranging to have the surviving or
successor entity or any parent entity thereof assume the Stock Options or grant
replacement Stock Options with appropriate adjustments in the option prices,
option consideration, payment terms and number and kind of securities issuable
upon exercise or payment; (iv) adjusting Stock Options or their replacements so
that such Stock Options are in respect of the shares of stock, securities or
other property (including cash) as may be issuable or payable as a result of
such transaction with respect to or in exchange for the number of Plan Shares
purchasable and receivable upon exercise or settlement of the Stock Options had
such exercise or settlement occurred in full prior to such transaction; or (v)
canceling Stock Options upon payment to the Participant in cash of an amount
that is the equivalent of the excess of the market value of the Plan Shares
deliverable in settlement of such Stock Option less any exercise or purchase
price applicable thereto. The Committee may provide for one or more of the
foregoing alternatives in any particular Award Document or reserve the
discretion to make such determination at any time prior to the occurrence of the
Change in Control. The Committee may, in contemplation of a Change in Control,
accelerate the vesting, exercisability or payment of Stock Options to a date
prior to the Change in Control, if the Committee determines that such action is
necessary or advisable to allow Participants to realize fully the value of their
Stock Options in connection with such Change in Control. Unless the Committee
determines otherwise, in the event of a Change in Control that is a complete
liquidation or dissolution of SMIC, all Stock Options outstanding at the time of
such Change in Control shall terminate without further action by any person.


          (f)    Change in Capitalization. The number and kind of Plan Shares
authorized for issuance under the various limits set forth in the Plan shall be
equitably adjusted by the Committee in the event of a capitalization issue,
rights issue, sub-division or consolidation of shares or reduction of capital


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in order to preserve, but not increase, the benefits or potential benefits
intended to be made available under the Plan. In addition, upon the occurrence
of any of the foregoing events, the number of outstanding Stock Options and the
number and kind of shares subject to any outstanding Stock Option and the
purchase price per share under any outstanding Stock Option shall be equitably
adjusted (including by payment of cash to a Participant) in order to preserve
the benefits or potential benefits intended to be made available to Participants
granted Stock Options (so that Participants shall receive the same proportion of
the equity capital of SMIC to which they were previously entitled). Such
adjustments shall be made by the Committee, whose determination as to what
adjustments shall be made, and the extent thereof, shall be final. Unless
otherwise determined by the Committee, such adjusted Stock Options shall be
subject to the same vesting schedule and restrictions to which the underlying
Stock Option is subject.


10.  Amendments and Termination


          The Board may at any time and from time to time alter, amend, suspend,
terminate or amend the Plan in whole or in part; provided, however, that
alterations or amendments to the terms and conditions of the Plan which are of a
material nature, or any change to the terms of Stock Options granted must be
approved by the shareholders of the Company, unless such alteration or amendment
takes effect automatically under the terms of the Plan. Any alteration or
amendment to the Plan must be in accordance with the requirements of the HK
Listing Rules or permitted by the Hong Kong Exchange. If the Plan is terminated
by the Board prior to the tenth anniversary of the date of Board approval, no
further Stock Options may be offered but, unless otherwise stated in the Plan,
Stock Options granted before such termination shall remain outstanding and
continue to vest and become exercisable in accordance with, and subject to, the
terms of the Plan.


11.  Miscellaneous

          (a)    A Plan Share allotted upon the exercise of a Stock Option shall
not carry voting rights until completion of the registration of the Participant
as the holder thereof. If under the terms of a resolution passed or an
announcement made by SMIC a dividend is to be or is proposed to be paid to
holders of Plan Shares on the register on a date prior to the date of allotment
for any Plan Shares issued upon the effective exercise of a Stock Option, the
Plan Shares to be issued upon such exercise will not rank for such dividend.
Except as mentioned in this Section 11(a), Plan Shares allotted upon the
exercise of a Stock Option shall rank pari passu (including, but not limited to,
with respect to voting, dividend and transfer rights and rights arising upon a
liquidation) in all respects with the Plan Shares in issue on the date of such
allotment and will be subject to all the provisions of the Articles of
Association of SMIC for the time being in force.

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          (b)    Subject to Section 9(e)(v), Stock Options granted but not
exercised may not be cancelled unless an offer to cancel Stock Options has been
made pursuant to Rule 13 of The Hong Kong Code on Takeovers and Mergers and the
Hong Kong Securities and Futures Commission has consented to such cancellation.

          (c)    Taxes and Other Withholding. The Company may require any
individual entitled to exercise a Stock Option to remit to the Company, prior to
such exercise, an amount in cash or in previously owned Plan Shares, or a
combination thereof, and, if the applicable Award Document so provides, in whole
or in part through the withholding of Plan Shares subject to the Stock Option
with a market value sufficient to satisfy any national, state or local tax
withholding requirements. The Company shall also have the right to deduct from
all cash payments made pursuant to or in connection with any Stock Option any
national, state or local taxes required to be withheld with respect to such
payments.

          (d)    No Right to Grants or Employment. No Eligible Individual or
Participant shall have any claim or right to receive grants of Stock Options
under the Plan. Nothing in the Plan or in any Stock Option or Award Document
shall confer upon any employee of the Company any right to continued employment
with the Company or interfere in any way with the right of the Company to
terminate the employment of any of its employees at any time, with or without
cause. Nothing in the Plan or in any Award Document shall be deemed as
conferring upon a service provider to the Company the status of employee.

          (e)    Other Compensation. Nothing in this Plan shall preclude or
limit the ability of the Company to pay any compensation to a Participant under
the Company's other compensation and benefit plans and programs.

          (f)    Other Employee Benefit Plans. Payments received by a
Participant under any Stock Option made pursuant to the Plan shall not be
included in, nor have any effect on, the determination of benefits under any
other employee benefit plan or similar arrangement provided by the Company,
unless otherwise specifically provided for under the terms of such plan or
arrangement or by the Committee.

          (g)    Unfunded Plan. The Plan is intended to constitute an unfunded
plan for incentive compensation. Prior to the payment or settlement of any Stock
Option, nothing contained herein shall give any Participant any rights that are
greater than those of a general creditor of the Company. The Committee may
authorize the creation of trusts or other arrangements to meet the obligations
created under the Plan to deliver Plan Shares or payments in lieu thereof with
respect to awards hereunder.

          (h)    Securities Law Restrictions. The Committee may require each
Participant purchasing or acquiring Plan Shares to represent to and agree with
the Company in writing that such Eligible Individual is acquiring the Plan
Shares for investment and not with a view to the distribution thereof. All
certificates (or electronic equivalents) for Plan Shares shall be subject to
such stock-transfer orders and other

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restrictions as the Committee may deem advisable under the rules, regulations,
and other requirements of the Securities and Exchange Commission, any exchange
upon which the Plan Shares are then listed, and any applicable securities law,
and the Committee may cause a legend or legends to be put on any such
certificates (or electronic equivalents) to make appropriate reference to such
restrictions. No Plan Shares shall be issued hereunder unless the Company shall
have determined that such issuance is in compliance with, or pursuant to an
exemption from, all applicable securities laws.

          (i)    Expenses. The costs and expenses of administering the Plan
shall be borne by the Company.

          (j)    Application of Funds. The proceeds, if any, received from the
Company from the sale of Common Shares will be used for general corporate
purposes.

          (k)    Applicable Law. Except as to matters of federal law, the Plan
and all actions taken thereunder shall be governed by and construed in
accordance with the laws of the Cayman Islands.

          (l)    Awards to Individuals Subject to Non-U.S. Jurisdictions. To the
extent that Awards under the Plan are awarded to individuals who are domiciled
or resident outside of the United States or to persons who are domiciled or
resident in the United States but who are subject to the tax laws of a
jurisdiction outside of the United States, the Committee may adjust the terms of
the Plan Shares granted hereunder to such persons (i) to comply with the laws of
such jurisdiction and (ii) to permit the grant of the Plan Shares not to be a
taxable event to the Participant. The authority granted under the previous
sentence shall include the discretion for the Committee to adopt, on behalf of
the Company, one or more sub-plans applicable to separate classes of Eligible
Individuals who are subject to the laws of jurisdictions outside of the United
States. Notwithstanding the foregoing, the adoption of any plan or sub-plan must
be in accordance with HK Listing Rules.

          (m)    Stated Periods of Time. Unless otherwise stated in the
applicable Award Document, all periods of time under this Plan and Award
Documents shall be calculated with reference to the then local time in Shanghai.
In the event that any applicable date is, or any period of days, months or years
set forth in this Plan or any Award Document ends on, a date that is Saturday,
Sunday or a public holiday in Shanghai, such applicable date or the end of such
period shall be the first Business Day following such date.

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