China opens huge port in Peru to extend its reach in Latin America
Chinese leader Xi Jinping will inaugurate a huge port in Peru on Thursday, expected to attract more than $3 billion in investment, to create a direct route across the Pacific Ocean and extend Beijing’s influence in Latin America.
The port opening, which comes ahead of the Asia-Pacific Economic Cooperation forum and Xi’s final meeting with President Joe Biden, underscores China’s growing clout in a region that once looked primarily to the United States for economic opportunity.
Chinese companies are involved in almost every aspect of the deepwater port in Chancay, which sits 50 miles north of the capital, Lima.
The high-tech logistics hub will be exclusively operated by Chinese shipping giant Cosco, which in 2019 invested $1.3 billion to take a 60 percent stake in the project. Chinese state media has estimated the total cost of the finished project to be over $3 billion.
The first phase, building a port that will handle only smaller ships, is expected to begin operations this month.
Its automated cargo cranes are supplied by Shanghai Zhenhua Heavy Industries, a company that congressional investigators have said poses a security risk to U.S. ports. Electric driverless trucks made by Chinese companies will be used to handle containers and cargo.
The level of Chinese interest and involvement in Chancay has drawn warnings from the United States about Peru potentially being used by Chinese military ships as a foothold in the Americas.
Gen. Laura J. Richardson, the recently retired former head of U.S. Southern Command, said Chancay “absolutely” could host Chinese navy warships following a “playbook that we’ve seen play out in other places,” in a recent interview with the Financial Times. Beijing has denied the project is motivated by anything other than commercial interest.
“The Chinese are not necessarily interested in a grand display and stationing a warship there, but they like to know it’s an option,” said Ryan Berg, director of the Americas Program at the Center for Strategic and International Studies, a think tank.
Chinese and Peruvian officials have celebrated the project as a transformative opportunity for Peru to become a central hub for South American goods from its biggest trading partner.
President Dina Boluarte, who is set to unveil the project alongside Xi, has called it a potential “nerve center” joining the continent to Asia, one that could create 8,000 jobs and $4.5 billion in economic activity annually.