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China establishes a presence in South America through a new big port facility in Peru

Credit: Ministry of Transport and Communications, Peru

China’s prominent shipping conglomerate establishes a presence in South America through a new versatile port facility in Peru.

COSCO’s ambitious $3 billion port project in Chancay, Peru, is poised to revolutionize logistics in Latin America.

In the district of Chancay, located in the Huaral province, roughly 80 kilometers from Peru’s capital, Lima, a significant private investment endeavor is underway, promising to reshape the logistics landscape in Latin America.

This venture is none other than the New Multipurpose Port Terminal of Chancay, a collaborative initiative between China’s COSCO Shipping Ports Limited (CSPL), holding a 60 percent stake, and Peru’s Volcan Compañía Minera, owning the remaining 40 percent.

Boasting a staggering budget exceeding $3 billion, this ambitious project is currently in the developmental phase, with construction progress surpassing the 40 percent mark. The construction efforts, which commenced in 2011, anticipate the terminal to commence operations in the final quarter of 2024.

The construction phase alone entails the establishment of a camp with a capacity to accommodate 1,500 individuals. During this period, the port project is estimated to generate a total of 7,500 job opportunities, both directly and indirectly.

Notably, the Chancay New Multipurpose Port Terminal’s standout feature is its capability to accommodate vessels of up to 18,000 TEUs (Twenty Foot Equivalent Units), making it the first port in Latin America capable of receiving vessels of this magnitude.

This capacity positions Chancay as a strategic global port.

Envisaged as a logistic hub, this mega-port, with its capacity to handle the world’s largest vessels, could potentially dominate a significant share of cargo traffic across the continent.

This ambitious project distinguishes itself through its intricate infrastructure, comprising three key components.

The first component encompasses the port’s operational area, encompassing piers, sea access channels, maintenance zones, specialized workshops, and extensive storage areas catering to containers, bulk goods, and roll-on/roll-off cargo. This operational zone serves as the core of port activities, ensuring efficient handling and storage of goods.

The second component is the entrance complex, which plays a pivotal role in the terminal’s logistics. It encompasses the vehicular port, entry gates, customs inspection zones, administrative offices, and a logistics and support services section, facilitating the seamless and secure flow of goods and vehicles in and out of the port.

Lastly, the third component, undoubtedly a highlight of the project, is the tunnel. Stretching over 1.8 kilometers, this tunnel forms part of a road corridor dedicated to cargo transit related to port operations. The underground viaduct will feature three vehicular lanes, two conveyor belts for bulk solids, and pipelines for transporting bulk liquids.

This colossal and unprecedented undertaking signifies a significant milestone in China’s burgeoning influence in Latin America.

Over the past decade, China has accelerated efforts to enhance its presence and influence in the region.

The Asian powerhouse, already the primary trading partner of Latin America, has solidified its position through substantial infrastructure projects, such as the Port of Chancay, as well as investments in crucial sectors including mining, telecommunications, lithium, energy development, and even space research, establishing itself as a major player in the region.

Some of these ventures span sensitive sectors, sparking concerns regarding China’s utilization of investments and loans to secure its influence in countries like Peru. In fact, all Latin American nations have outstanding debts to China, a phenomenon that has raised eyebrows in the United States, which seeks to maintain its strategic standing in relations with Latin American countries.

Latin America, rich in natural resources, holds pivotal importance in contemporary global geopolitics. Lithium, a mineral essential for technological advancement, stands at the forefront of international attention. The largest concentration of lithium lies within the “lithium triangle,” encompassing Argentina, Bolivia, and Chile. It is thus natural for superpowers like China and the United States to vie for a stronger presence in the region, given the strategic significance of these resources in the global economy.

In this context, the Port of Chancay assumes a vital role for China. This port establishes a direct link between Asia and South America, substantially reducing travel time across the Pacific Ocean. Upon operational readiness, the port will save 10 days in transit time compared to conventional routes that necessitate multiple stops further south.

With a majority investment of 60 percent from the state-owned COSCO, Chancay is poised to become China’s inaugural logistics hub in South America. It adds another bright star to the extensive constellation of Chinese-owned ports spanning Europe, the Middle East, Africa, South Asia, and beyond.

Given the project’s advancement and substantial investment, the New Chancay Multipurpose Port Terminal emerges as a venture of great significance for both Peru and the broader region. Moreover, it serves as a testament to China’s expanding influence in Latin America.


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