China sets its sights on South America with Peru port
This story was produced by our colleagues at the BBC.
Huge unmanned cranes loom over Peru’s Chinese-funded Port of Chancay — a symbol of Beijing’s growing influence in South America. Situated on the edge of Peru’s coastal desert, some 50 miles north of the capital, Chancay — a small fishing town — looks set to become a major hub for trade in a region the U.S. has long considered its own backyard.
This month, the new megaport will increase the frequency of trips to Asia. With a direct route to China that cuts sailing times by 10 days, the port aspires to become South America’s gateway to Asia, bypassing North America entirely.
It’s a game-changer, not just for Peru, but for the wider region. And at a time when President-elect Donald Trump is looking to clamp down on trade with China, China has set its eyes on Peru, making Peru a strategic piece on the geopolitical chessboard.
The man overseeing the port’s operations, Mario De Las Casas, said the port will dramatically speed up trade.
“You’re going to have an express, Chancay directly to Shanghai,” he said. “It’s a huge opportunity for South America, because right now all the materials that you export to Asia, you have to go to Mexico or along the beach, and then you cross the Pacific Ocean.”
But despite the promises of growth, some in the local community feel left behind. The fully-automated port has so far offered few jobs. William Wallace, a local fisherman, is struggling to make a living. “My work has been affected 100%,” he said.
“The area we used to fish in has been cut off. We used to row out, fish in the morning, sell our catch, rest in the afternoon and return to fish again in the evening. That was our daily routine — not anymore.”
The nearly $1.5 billion port — majority owned by China’s COSCO Shipping — is China’s latest Belt and Road project. China has overtaken the U.S. as Peru’s main trading partner, a trend that could widen across South American countries as Donald Trump threatens tariffs under his “America First” policy.
Critics warn of over-reliance on China and jeopardizing the existing relationship with the U.S., with some of Trump’s aides already pushing for huge tariffs on all merchandise coming through the port.
But for Peru’s Minister for Foreign Trade, Ursula Leon, it’s not a cause for concern.
“The products we export to Asia are not necessarily the same as we send to the U.S. or Canada. Our agreements with China enhance our competitiveness without compromising other markets,” she said.
Leon said Peru’s partnership with China will not undermine its relationship with the U.S.
“Our relationships with both China and the U.S. are strong and mutually beneficial. Trade agreements are designed for the growth of all parties involved: Peru benefits from exporting its products, while our partners get access to high quality goods at competitive prices,” she added.
Peru must navigate a delicate balancing act. For now, the Chancay port stands as both a beacon of opportunity and a source of uncertainty in a world bracing for heightened trade tensions.