2024-11-15 01:13:00
The first Chinese-controlled port in South America has opened in Peru. China’s President Xi Jinping and Peru’s head of state Dina Boluarte inaugurated the new mega port of Chancay. It is located around 80 kilometers north of Lima on the Pacific coast. This is a “historic moment for Peru,” said Boluarte at the inauguration ceremony, which the two presidents followed virtually from the government palace in the Peruvian capital for security reasons.
The port is owned 60 percent by the Chinese state-owned company Cosco Shipping Ports and 40 percent by the Peruvian company Volcan Compañía Minera. Chinese control of the port is not without controversy. A total of 3.5 billion US dollars (3.3 billion euros) will be invested in the construction of the port facility. In the first expansion phase, around one million containers can be handled per year.
Cosco will establish a direct route to Shanghai. This shortens the passage to around 23 days. So far, ships from Peru usually travel to China via Manzanillo in Mexico and Long Beach in the USA. This means the crossing takes around 40 days. The port will serve to promote development between China and Latin America, Xi said in an article in the Peruvian newspaper El Peruano.
The trade volume between China and Peru has doubled to $33 billion since the free trade agreement was signed in 2009. Over the past decade, Beijing has invested around $24 billion in mining and energy projects in the South American country. “China is taking advantage of our absence and that is a real problem,” says former US diplomat and Latin America expert at the Council of the Americas, Eric Farnsworth.
The Peruvian Congress passed a law granting Cosco exclusive use of the port. “This shows that China is not building a port for the Peruvians, but a Chinese port in Peru. That is a big difference,” wrote Argentine logistics expert Agustín Barletti in the newspaper “El Cronista.”
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What are the potential risks and benefits for Peru associated with the Chancay port opening?
**Interview with Dr. Elena Chen, International Relations Expert**
**Editor:** Thank you for joining us, Dr. Chen. We just learned that the first Chinese-controlled port in South America, the mega port of Chancay, has opened in Peru. Can you provide some context on this development?
**Dr. Chen:** Absolutely. The inauguration of the Chancay port marks a significant step in China’s Belt and Road Initiative, enhancing its economic influence in Latin America. This facility is strategically located along key shipping routes, which allows for increased trade connectivity not only between China and Peru but with other countries in the region.
**Editor:** What does this port mean for Peru’s economy specifically?
**Dr. Chen:** The Chancay port is expected to boost Peru’s exports, especially in sectors like agriculture and mining. This could lead to job creation and improved infrastructure. However, there are also concerns about dependency on Chinese investment and the potential environmental impact associated with port operations.
**Editor:** How have local communities reacted to the establishment of the port?
**Dr. Chen:** Reactions are mixed. Some communities are hopeful about job opportunities and economic growth, while others are wary of displacement and environmental degradation. It’s crucial for the Peruvian government to engage with local populations and address their concerns.
**Editor:** What implications does this port have for China’s global strategy?
**Dr. Chen:** This port solidifies China’s position as a key player in global trade, allowing it to expand its influence in South America. It reflects China’s broader ambition to create a network of economic partnerships that can enhance its global supply chain. This could challenge traditional trade powers in the region, particularly the United States.
**Editor:** what should we watch for in the coming months related to this development?
**Dr. Chen:** Keep an eye on the economic indicators from Peru, including trade volumes and local employment rates. Additionally, monitor any political developments as both countries navigate this new relationship. The balance between economic benefits and local concerns will be pivotal for the future of the Chancay port.
**Editor:** Thank you, Dr. Chen, for your insights on this important development. It will be interesting to see how this unfolds in the coming months.
