In the quiet ancient town of Chancay, Peru, China is constructing a major deep-water port, set to be inaugurated by Chinese leader Xi Jinping later this year when he makes his first trip to South America since the pandemic. The port aims to challenge US influence in South America by offering faster trade routes between it and Asia, potentially benefiting countries like Brazil and expanding markets for Chinese exports.
The port is majority-owned by giant shipping company China Ocean Shipping group, referred to as “Cosco.” The $3.5 billion port, just 50 miles north of the Peruvian capital Lima and funded by Chinese bank loans, will be the first on South America’s Pacific coast capable of handling megaships due to its 60 feet of depth. It will allow direct cargo shipments between Peru and China, enhancing trade possibilities and potentially granting China a submarine cable link, which Chinese media outlets have previously bragged about.
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US officials are raising concerns about China’s growing control and influence in the resource-rich region, including hard materials like copper and foods like blueberries. “This will further make it easier for the Chinese to extract all of these resources from the region, so that should be concerning,” said Army Gen. Laura Richardson, head of US Southern Command.
These concerns have been dismissed by actors involved, emphasizing that the port’s purpose is purely commercial and not militaristic. “This is a commercial project to promote development,” Cosco’s deputy general manager in Peru, Gonzalo Rios, said in a statement. “There is nothing to hide here.”
Peruvian Foreign Minister Javier González-Olaechea said the US should rise to the challenge if it wishes to trade with Peru. “The United States is present almost everywhere in the world with a lot of initiatives, but not so much in Latin America,” he said in an interview. “It’s like a very important friend who spends little time with us.”
Shane Devine is a writer covering politics and business for VT and a regular guest on The Unusual Suspects. Follow Shane’s work here.
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