2024-11-17 22:50:00
“From Chancay to Shanghai” has become a popular slogan in Peru, with the port of Chancay, a flagship project of China’s proposed Belt and Road Initiative (BRI), being ceremoniously opened on Thursday.
The $1.3 billion megaproject is set to transform regional trade by providing space for the world’s largest cargo ships and significantly reducing shipping times. In the first phase of the project, the sea route from Peru to China will be shortened to 23 days, reducing logistics costs by at least 20 percent.
The new port has four landing points with a maximum depth of 17.8 meters, where ultra-large container ships with a capacity of 18,000 TEU (Twenty-foot Equivalent Units) can dock. The port’s planned annual handling capacity is one million TEU in the short term and 1.5 million TEU in the long term, making it an important hub for trade between Latin America and Asia.
Chinese President Xi said in the article he signed and published Thursday in the Peruvian daily El Peruano that the Chancay port project will bring Peru $4.5 billion in annual revenue and create more than 8,000 direct jobs.
Xi and his Peruvian counterpart Dina Boluarte attended the opening ceremony of the Chancay port via video link on Thursday.
“From Chancay to Shanghai, we are witnessing not only the roots and blossoming of the New Silk Road in Peru, but also the birth of a new gateway connecting land and sea, Asia and Latin America,” President Xi said at the opening ceremony.
Xi flew to Peru on Thursday on a state visit to attend the 31st APEC Economic Leaders’ Meeting. It is his sixth visit to the continent since 2013.
Transforming regional trade dynamics
Chancay Port is not only a good deep-water port, but also the first smart and green port in South America, Xi said.
The strategically located port serves as Peru’s gateway to the Pacific. It is connected to the Pan-American Highway via a tunnel and offers direct access to Peru’s capital Lima. As the first “sea highway” to Latin America, it will enable faster and more cost-efficient transport of Peruvian export goods such as cranberries and avocados to Asian markets.
“Our goal is to become the Singapore of Latin America, so that port cargo passes through here on its way to Asia. If someone from Brazil, Venezuela, Bolivia, Paraguay and Argentina wants to travel to Asia, they should consider Peru as a starting point,” Peruvian Transport Minister Raul Perez Reyes told reporters last month.
The construction of Chancay Port is in line with the growing demand for trade between China and Latin America.
In addition, Peru has initiated plans to develop a railway and highway network that will connect the port of Chancay to the country’s major cities, with potential future connections to the transport networks of other regional countries. This could support the efficient export of Brazilian soybeans, iron ore, frozen meat, Colombian coffee, avocados and other goods to Asia via this new trade route.
“The port of Chancay will help Peru improve shipping efficiency and deepen trade cooperation with Asia,” said David Gamero, deputy head of the mega port project in Chancay. He added that in addition to direct economic benefits, the huge port will also bring promote the development of Latin America’s logistics value chain and promote technological and industrial growth, creating a “multiplier effect”.
Xi once referred to Peru as “China’s neighbor across the Pacific” and quoted an ancient Chinese poem to describe China’s relations with the countries of Latin America and the Caribbean: “True friends always feel close to each other, no matter how far they are from each other are removed”.
Once operational, the Port of Chancay will integrate the entire Latin American region into the dynamic economic framework of the Asia-Pacific region and significantly improve connectivity within the continent and beyond.
Intensifying cooperation between China and Latin America
The New Silk Road proposed by China in 2013 was expanded to include Latin America and the Caribbean in 2017.
According to the report of a steering group for the Belt and Road Initiative, 22 countries in the region have signed BRI cooperation documents with China by 2023. Notable projects include the Belo Monte hydroelectric power plant in Brazil and Argentina’s Belgrano-Cargas railway line, to name a few.
China has also been Latin America’s second largest trading partner since 2012. In 2023, the total trade volume between China and Latin American countries exceeded $489 billion.
Experts say China’s investments and technical assistance are helping Latin American countries accelerate their economic development and have become an important driving force for the development of the global South. They also expressed expectation that Xi’s participation in APEC will give positive impetus to regional integration and economic cooperation.
Rafael del Campo Quintana, vice president of the Peruvian Exporters Association, explained that APEC is not only an important platform to promote regional trade and economic cooperation, but also offers developing countries, including Peru, the opportunity to deeply integrate into the global economy.
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What are the expected economic benefits of the Chancay Megaport for local communities in Peru?
**Interview with David Gamero, Deputy Head of the Chancay Megaport Project**
**Interviewer:** Thank you for joining us, David. The opening of the Chancay Port is a historic event for Peru. Can you share your thoughts on how this project will transform regional trade?
**David Gamero:** Absolutely! The Chancay Port represents a game changer for trade in South America. By significantly shortening the shipping route from Peru to China to just 23 days, we expect to reduce logistics costs by about 20%, which is huge for exporters looking to access Asian markets.
**Interviewer:** This port is being touted as the first smart and green port in South America. Can you explain what that means for its operation?
**David Gamero:** Certainly! Being a smart port means we will utilize advanced technologies for operations, enhancing efficiency and safety. Moreover, our commitment to green practices will minimize the environmental impact of port activities. This combination is vital for sustainable growth in the region.
**Interviewer:** President Xi mentioned the project would generate significant revenue and create jobs. How do you see this impacting the local economy?
**David Gamero:** The port is projected to bring in $4.5 billion annually and create over 8,000 direct jobs. This influx will provide a substantial boost to the local economy, not just through employment but also through increased activity in sectors like logistics, construction, and services.
**Interviewer:** There’s talk of Chancay becoming the ‘Singapore of Latin America’. What do we need to do to achieve that vision?
**David Gamero:** For Peru to become a regional hub, we need to continue developing our infrastructure—specifically, the rail and highway networks connecting Chancay to major cities and neighboring countries. Collaboration with other nations will be key to facilitating smooth and efficient trade routes.
**Interviewer:** As this port opens, what challenges do you foresee in the transition to being a major trade hub?
**David Gamero:** One challenge is ensuring that our workforce is prepared for the new technologies and operations that a smart port will require. We must invest in training and development for our employees to adapt to these changes. Additionally, we need strong partnerships with private and public sectors for ongoing support and investment.
**Interviewer:** what does this project mean for Peru’s long-term relationship with China?
**David Gamero:** The Chancay Port is a testament to the strengthening ties between Peru and China. It’s not just about trade; it represents a strategic partnership that can lead to further mutual benefits in technology transfer, infrastructure development, and economic growth.
**Interviewer:** Thank you, David, for your insights. The Chancay Port truly stands to reshape Peru’s economic landscape!
**David Gamero:** Thank you! We’re excited about the future and what this port can achieve for Peru and the region.
