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Home Posts From Chancay to Shanghai—China Expands Its Influence in Latin America

From Chancay to Shanghai—China Expands Its Influence in Latin America
Yuval Less
2 December, 2024
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On November 14, Chinese President Xi Jinping visited Peru to inaugurate the first Chinese-funded port in Latin America. The new port is set to become a transportation and logistics hub connecting Peru with China. It’s expected to reduce shipping times to China and lower logistics costs by 20%, with the capacity to accommodate ultra-large ships due to its depth of approximately 17 meters. The total cost of the project is estimated at $3.5 billion and will be managed by Cosco Shipping Ports, one of the world’s largest Chinese shipping giants, holding 60% of the shares in the Peruvian port.

In recent years, China has become a dominant player in Latin America, steadily consolidating control over global trade routes. Beyond its immense size and role as a deep-water port, the strategic location of the Chancay Port is expected to enhance trade between China and Peru and connect trade between Latin America and East Asia. As of 2022, China is Peru’s largest trading partner and the second-largest trading partner of Latin America. China’s trade with Latin America reached $485.7 billion in 2022, a 7.7% increase from the previous year. The port’s operations will further solidify China’s position as an economic player in the region and facilitate the supply of metals, such as lithium and copper, to China.

The United States has expressed concern over China’s presence in South America, a strategically significant and resource-rich region considered its “backyard.” Moreover, China’s potential use of the Peruvian port heightens American fears about its control over areas that could serve not only commercial purposes but also military activities, threatening geopolitical stability. Gen. Laura Richardson, former commander of the US Southern Command, warned that the Chinese navy might use the port for intelligence gathering. The Peruvian port is expected to be the first step in China’s broader expansion in Latin America through infrastructure and port projects, marking another move to strengthen its influence among Global South nations.

Topics: Israel-China Policy Center - The Diane and Guilford Glazer Foundation
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