(Bloomberg) —
Peru is pitching a new port project to investors in the US, describing it as a potential balance to growing Chinese influence over maritime trade in the South American nation.
China’s state-owned Cosco Shipping is set to inaugurate the $1.3 billion Chancay port later this year, which is likely to upend South American trade with Asia. Now, Peruvian officials are trying to use the Chancay example to continue growing the country’s potential as a regional trade hub, with geopolitics in mind.
“It would be a port that could be a counterweight to China’s Chancay project,” Alfredo Ferrero, Peru’s ambassador to the US, told Bloomberg in an interview following a presentation to executives in New York.
The Chancay port has worried American officials, who openly criticize Chinese investments in Latin America that dwarf those of US companies. Peru expects Chinese President Xi Jinping to travel to Peru for Chancay’s inauguration at the Asia-Pacific Economic Cooperation (APEC) conference. While Chancay is drawing attention now, it is just the latest example of Chinese investments in Peru.
“One hundred percent of Lima’s electricity is owned by China, many of the copper mining projects are owned by China. China will have the largest port in South America,” Ferrero said. “Objectively, that is the situation and the United States has noticed this. But it’s not enough to notice it, action is needed.”
Ferrero is a former Peruvian trade minister who negotiated a free trade agreement with the US that is still in place. He was named ambassador to the US early this year and has set out to lure fresh investments.
The new port project he is pitching, known as Corio, is almost 700 miles south of Chancay. It is also south of Callao, where DP World and APM operate terminals. The Corio area is also close to the Matarani port, which is already a key copper export hub. Peru’s port authority recently announced a study to understand what cargo demand would look like for Corio.
Ferrero is aware that the idea of the Corio port is at a very early stage. But he says the project has potential because of its proximity to Chile, Argentina and Bolivia, which are all trying to increase lithium production due to demand for electric vehicles.
Ferrero is working to grow awareness of the Corio port project in the US to attract private investors. “The idea is that the American government calls for possible interested parties for them to make the investment,” he said.
That doesn’t mean Peru is only asking American investors to consider the Corio port project, however. But Ferrero hopes American investors will look into it. “Hopefully it’s from the US, but it can be from whichever country that’s interested.”
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