A New Chinese Megaport in South America Is Rattling the U.S.

CHANCAY, Peru—In this serene town on South America’s Pacific coast, China is building a megaport that could challenge U.S. influence in a resource-rich region that Washington has long considered its backyard.

The Chancay deep-water port, rising here among pelicans and fishermen in small wooden boats, is important enough to Beijing that Chinese leader Xi Jinping is expected to inaugurate it at the end of the year in his first trip to the continent since the pandemic.

Majority-owned by the giant China Ocean Shipping group, known as Cosco, Chancay promises to speed trade between Asia and South America, eventually benefiting customers as far away as Brazil with shorter sailing times across the Pacific for everything from blueberries to copper.

As nations around the world shudder at a new flood of cheap Chinese manufactured goods, the port could open new markets for its electric vehicles and other exports. China is already the top trade partner for most of South America.

The U.S. worries that China’s control over what could become South America’s first true global commercial hub will allow Beijing to further strengthen its grip over the region’s resources, deepen its influence among America’s closest neighbors and eventually plant its military nearby.

“This will further make it easier for the Chinese to extract all of these resources from the region, so that should be concerning,” Army Gen. Laura Richardson, who heads the U.S. Southern Command, said last month at a Florida International University security conference.

Former American officials say the project highlights a diplomatic void that the U.S. has left in Latin America as it has concentrated resources elsewhere, most recently in Ukraine and the Middle East.

“This changes the game,” said Eric Farnsworth, a former high-ranking State Department diplomat who now leads the Washington office of the Council of the Americas think tank. “It really platforms China in a major new way in South America as the gateway to global markets. It is not just a commercial issue at that point, it is a strategic issue.”

Located 50 miles north of Peru’s capital, Lima, the $3.5 billion port—funded by Chinese bank loans—will be the first on South America’s Pacific coast able to receive megaships because of its nearly 60 feet of depth, though other ports in the region have large container-handling capacity. That will allow companies to send cargo on those vessels directly between Peru and China rather than on smaller ships that must go first to Mexico or California.

Cosco says Chancay is purely intended to boost commerce.

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