China builds megaport in Latin America, consolidates influence in the region

China strengthens its presence in South America with the inauguration of a megaport in Peru, a strategic infrastructure that is part of its ambitious program of “New Silk Roads”.

The Chancay terminal, located about 80 km north of Lima, will allow transit during its first year of operation of one million containers. It was built by Cosco Shipping Ports, 60% owner of the port and a subsidiary of the Chinese shipping giant Cosco Shipping.

It was created as part of the Chinese program launched in 2013, officially called “the Belt and Road”, which aims to build infrastructure and develop maritime, road and rail links between continents, particularly in developing countries.

Several South American countries (Peru, but also Argentina, Chile, Bolivia, Ecuador and Venezuela) have already joined this initiative, which constitutes a central axis of China's strategy to increase its influence abroad.

“From Chancay to Shanghai, what we are witnessing is not only the +Belt and Road+ initiative taking root and flourishing in Peru, but also the birth of a new land-sea corridor between Asia and Latin America”, Xi Jinping said on Thursday, inaugurating the port from Lima.

The Chinese leader had arrived a few hours earlier in the Peruvian capital, where the Asia-Pacific Economic Cooperation (APEC) summit, which brings together 21 countries representing 60% of the world's GDP, is being held until Saturday.

“We must work together to build, manage and operate the port of Chancay,” Xi Jinping said during a ceremony at the presidential palace, adding that he wanted to “promote connectivity between South America and China.”

– “Inca Trails” –

“We are a reliable partner and today, with the inauguration of the Chancay megaport, we confirm it,” assured Peruvian President Dina Boluarte.

The megaport of Chancay, north of Lima, on October 29, 2024 in Peru © AFP – Cris BOURONCLE

Cosco Shipping Ports has a 30-year concession to operate the infrastructure under development, which will eventually cover an area of ​​141 hectares.

China seeks to secure its supply in strategic raw materials such as copper, soy and lithium, considered crucial in the context of the ecological transition.

The Asian giant also intends to strengthen its exports to South America, a region where its influence continues to grow to the detriment of the United States, which was once predominant.

The port will have four quays initially, then 15 in the long term, for a total investment of 3.5 billion dollars.

The deep-water terminal (nearly 18 meters), construction of which began in 2021, will be able to accommodate the largest container ships in the world, behemoths capable of transporting up to 24,000 containers.

The infrastructure will reduce maritime journeys between China and Peru by around ten days, thereby reducing transport costs.

The facility “will allow China to position itself in this region of the world,” says Oscar Vidarte, professor of international relations at the Catholic University of Peru

At the new megaport of Chancay, north of Lima, October 29, 2024 © AFP – Cris BOURONCLE

Peru, but also Chile, Colombia, Ecuador and even the Brazil should benefit from the facility, which will allow them to no longer ship their goods to Asia through ports in Mexico and the United States.

Once fully completed, the port “will bring enormous benefits to Peru and create a large number of jobs,” Xi Jinping said.

Drawing parallels between Asia and Latin America, he cited the navigators of ancient China, but also the Incas who, “defying hardships,” built a network of pedestrian routes in the Andes, known as the “Inca Trails.”

“Today, the port of Chancay becomes a new starting point for the Inca Trails of the new era,” he observed.

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