The Chinese and European space agencies are calling the project a "moon village" and it is slated to be an international hub for scientific research, commercial mining operations, and a launch pad for missions to Mars and beyond, Johann-Dietrich Wörner, the director general of the European Space Agency told Space.com.
The announcement was made during the recent 32nd Space Symposium.
Pal Hvistendahl, a spokesman for ESA, says Europe is pursuing the partnership with China to unite the different space programs and push human progress beyond Earth.
"Space has changed since the space race of the Sixties. We recognize that to explore space for peaceful purposes, we do international cooperation," says Hvistendahl.
Currently, China is not part of the International Space Station. The U.S. blocked China from the ISS because China's space program has strong military connections, The Independent reports.
NASA plans to send astronauts to Mars by the end of the 2030s. But this mission, and other deep space missions, will require international cooperation. Wörner says the moon village does not have a timeline, but the permanent outpost will start slowly. He envisions a rover could place an inflatable space habitat for astronauts and then robots could using 3D printing technology to start building larger, more sustainable structures.
As for the ultimate destination, Wörner says the moon village will help humans push the boundaries of space exploration.
"I would not call Mars the ultimate goal. I am quite sure humans will go further," Wörner says.