China takes first step in building Peru’s mega port

China has taken the first step in its master plan to build the Peruvian port of Chancay as „China’s gateway to ‚South America'“.

State-owned shipping company China COSCO Shipping has signed a $600 million first phase contract with China Communications Construction Company (CCCC). This includes the development of a nearly 1,000-hectare port area, a multi-purpose marina, breakwaters, jetties and a 1.8-kilometer access to the port complex.

Chancay is now primarily based on fishing and agriculture, but will become a regional hub with shipping links throughout the Pacific. The coastal city is about 70 points north of Peru’s capital Lima and has a population of almost 10 million.

Regional hub

China has announced its intention to put some three billion dollars into developing Chancay into a regional hub. Peru has become a major trading partner of China in recent years. Chinese companies have invested about $30 billion in the South American country since the trade agreement was signed in 2010.

According to Peru’s ministry, the project has a huge boost for the national economy. Project leader Alfonso Rebazza spoke of greatly improved ties with Asia and a number of countries, including Bolivia, Uruguay, northern Chile, Colombia and Ecuador.

COSCO said it expects the first new berth to be commissioned by the middle of next year. Volcan, a subsidiary of the Swiss commodities trader Glencore, is a 40 percent minority shareholder in this project.