China’s President Xi Jinping and Peru’s Dina Bouluarte celebrated the opening of the new Chancay megaport on Thursday, November 14, during an elaborate ceremony in Lima at the start of Xi’s state visit to South America timed to coincide Asia-Pacific Economic Cooperation Forum 2024. The post which was developed by COSCO and majority-owned by China’s state shipping company, comes with broad geo-political implications as China’s largest foothold in South America.
During an event attended by dignitaries from the two countries, the two presidents watched a live feed on a large video screen as the ribbon was cut marking the opening of the port which completed its first phase of construction just weeks ago. COSCO is reported to have invested $1.3 billion into the mega project which is part of a regional $3.5 billion investment to create one of the leading logistics hubs in South America. Peru has committed to large-scale investments to build the road and rail infrastructure to connect what was a remote area to the country’s commercial flow.
Presentation about the port during the live stream event
It was noted that it is XI’s third visit to Peru. He hailed the port development saying it is a successful start of a “21st-century maritime Silk Road,” alluding to China's framed trading route. The Chinese government views the port as a key part of its Belt and Road Initiative and helping to expand Chinese influence over trade, especially in South America.
The new port is located approximately 50 miles to the north of Peru’s capital Lima in an area that was historically a remote fishing community. The first phase of the port has just four berths but a depth of approximately 56 feet and a capacity to handle the new ultra-large generation of container vessels with a capacity of 18,000 TEU. The full plan for the port calls for 15 berths to be built as well as a large industrial park facility.
Chinese officials are calling Chancay the first smart port and green port in South America. In an article attributed to Xi, they asserted that the port will generate $4.5 billion in annual revenue for Peru and create over 8,000 jobs. COSCO holds 60 percent ownership in the port and has a 30-year concession for the port's operation with the other 40 percent held by Peruvian mining company Volcan.
¡Hoy es un día histórico para el Perú! ???????????? Entró en operación el puerto de Chancay, que revolucionará el comercio con Asia. En el marco del #APECPerú2024, la inauguración de este puerto marca un hito en la economía del país, con rutas más rápidas y eficientes. pic.twitter.com/u2FLfeoh4K
— Ministerio de Transportes y Comunicaciones (@MTC_GobPeru) November 15, 2024
They asserted that the port is designed to create strong economic ties with China and facility improve trade between the countries. It is being pointed out that the new port helps to reduce sea time for shipping between China and Peru to 23 days. They state that it will cut logistics costs by at least 20 percent.
COSCO began testing at the port in mid-October directing at least five of its large containerships to the facility. They were testing the navigation and operation of the new cranes preparing for the first official vessel which is expected to depart the port next week transporting Peruvian fruit to China.
One of China’s newest containerships, COSCO Shipping Peru (144,700 dwt / 14,100 TEU), placed in service in July was shown in the port. In addition, COSCO’s containership Xin Shanghai (111,737 dwt / 9,500 TEU ) was positioned as the backdrop for the ceremony with COSCO containers stacked on the dock.
China is continuing to expand its investment in Peru. In March, it was announced that another Chinese construction company won the right to construct the terminal to create the country’s third largest port, San Juan de Marcona. It will be located approximately 300 miles to the south of Lima and is expected to open in 2025.
A 3.4 billion dollar mega port China has built in Peru - China is closing in! pic.twitter.com/hicjq9Z7nS
— Ashok Swain (@ashoswai) November 15, 2024
