Chinese President Xi Jinping and Peruvian President Dina Boluarte “almost” inaugurated the Chancay megaport on Thursday night, a million-dollar infrastructure project financed largely by the Asian giant under the promise of speeding up trade between the region and Asia.
Although Xi and Boluarte gave permission through a video call to the staff of Cosco Shipping Ports to officially start operations, hundreds of people, in the middle of a party atmosphere, followed the live broadcast through a huge screen installed in the main square from Chancay, whose town is located about 80 kilometers north of Lima and where the port is located.
“Construction is complete. The conditions for starting operations are met,” said one of the executives, to which the leaders immediately responded in Spanish and Chinese: “go ahead, go ahead.”
Immediately, one of the port’s automated cranes sprang into action, placing a container wrapped in the Peruvian flag onto a giant cargo ship, with Chinese background music playing in the transmission.
“We are witnessing a new maritime corridor between Asia and Latin America,” President Xi said while speaking at the symbolic event. “It’s a new era,” he said.
He emphasized that it is the first smart port in South America and a reduction of at least 10 days in trade routes between the region and China.
For his part, President Boluarte said that ”the event is a historic moment for Peru and for all Peruvians” and declared that it begins a process to transform the country into an “excellent” industrial logistics center that will begin with “strategy” for us. “.
In addition, he emphasized the role of China in the growth of the Peruvian economy.
Signing agreements
An initial investment of 1.3 billion dollars was required to build the megaport by Cosco Shipping Ports, and an additional 2.3 billion dollars would be added to expand its facilities. It is expected to move one million containers per year.
President Xi, in an article published by the official newspaper El Peruano in its print edition on Thursday, said that the port would generate an annual income of 4.5 billion dollars, more than 8,000 jobs and reduce logistics costs on the Peru-China route through 20%.
Before the inauguration, the two presidents signed several bilateral cooperation agreements and sealed the optimized protocol of a Free Trade Agreement, which has been in force since 2009, and which is expected to give a new boost to business between the two countries.
Xi arrived in Lima with a delegation of more than 100 executives from Chinese companies, including heads of companies with the largest investments in Peru, including Cosco Shipping and the mining company Chinalco, the owner of the copper mine Toromocho.
he The President of the United States, Joe Biden, also came to Lima participate in the APEC Forum. Xi and Biden are expected to meet on Saturday in Lima, before leaving for Brazil for the summit of the Group of 20 major economies (G20).
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What are the economic implications of the Chancay megaport for Peru and its relations with China?
Interview: Inauguration of the Chancay Megaport – A New Chapter for Peru and China’s Economic Relations
Editor (Time.news): Welcome to this special edition of Time.news! Today, we have the honor of speaking with Dr. Elena Martelli, an international trade expert and professor at the University of Lima. Dr. Martelli, thank you for joining us!
Dr. Elena Martelli: Thank you for having me! It’s a pleasure to discuss such a significant development.
Editor: The recent inauguration of the Chancay megaport, with Chinese President Xi Jinping and Peruvian President Dina Boluarte participating via video call, certainly marks a milestone. What are your initial thoughts on this project and its potential impact on Peru?
Dr. Martelli: The Chancay megaport is indeed a historic moment for Peru. As the first smart port in South America, it promises to revolutionize trade between Latin America and Asia. The reduction of at least 10 days in trade routes to China is a game changer for our exporters and can significantly boost our economy.
Editor: Absolutely! President Boluarte mentioned that this event begins a process to transform Peru into an “excellent” industrial logistics center. How realistic do you think this vision is?
Dr. Martelli: I think it’s quite realistic, but it will require a strategic approach. With the port’s initial investment of $1.3 billion and additional $2.3 billion for expansion, the economic infrastructure is being laid out. However, success will depend on how well we can manage logistics, attract further investments, and train a skilled workforce to utilize this new capacity.
Editor: That’s a critical point. The port is expected to move one million containers per year and create over 8,000 jobs. How important do you think these job opportunities are for local communities?
Dr. Martelli: Very important! Job creation will not only provide direct employment but also stimulate local economies through ancillary businesses and services. As the port operates, it can foster a logistics hub, attracting businesses related to shipping, storage, and manufacturing. However, it’s crucial to ensure that training programs are in place to equip locals with the necessary skills for these jobs.
Editor: President Xi emphasized the economic significance of this port, estimating it could generate $4.5 billion annually. How should Peru leverage this potential?
Dr. Martelli: Peru must leverage this potential by enhancing its export capabilities and diversifying its market reach. Strengthening trade agreements beyond China and investing in local industries that can thrive through this port will be essential. Also, fostering relations with Asian markets will open new avenues for Peruvian goods.
Editor: You mentioned trade agreements. The two presidents signed several bilateral cooperation agreements related to trade. How crucial are these agreements for the future of Peru’s economy?
Dr. Martelli: They are fundamental. These agreements lay the foundation for legal frameworks that facilitate trade, reduce tariffs, and encourage investment. The updated Free Trade Agreement protocol could lead to significant increases in trade volume. It’s about creating a stable environment where businesses feel confident to invest and grow.
Editor: As we look at the international context with President Biden also visiting Lima for the APEC Forum, how do you see Peru navigating its relationships with both the U.S. and China?
Dr. Martelli: It’s a complex balancing act. While China is a major partner with substantial investments in Peru, the U.S. remains an essential ally, especially in areas like security and democratic values. Peru must engage both powers thoughtfully, capitalizing on economic opportunities while ensuring it maintains its sovereignty and promotes sustainable practices.
Editor: Dr. Martelli, as an expert, what would you say is the biggest challenge ahead for Peru in this new chapter?
Dr. Martelli: One of the biggest challenges will be infrastructure—making sure that not just the port, but transportation links and local facilities can support this increase in trade. Additionally, environmental sustainability should be at the forefront of development strategies, ensuring that progress does not come at the expense of our natural resources.
Editor: Thank you, Dr. Martelli, for your insights into this transformative milestone for Peru and its economic partnerships. We look forward to seeing how the Chancay megaport develops and impacts the region!
Dr. Martelli: Thank you for having me! It’s an exciting time, and I’m eager to see the changes that unfold.
Editor: This has been a fascinating discussion. Stay tuned for more updates on this pivotal moment in Peru’s economic journey!
