Peru's president asks Chinese companies to invest more than $31 billion in railways - Geoeconomics

China will operate Peru's deepwater port for thirty years

From June 25-29, Peru's President Dina Hersilia Boruarte Segarra paid a state visit to China, during which she visited Shenzhen, Shanghai, Suzhou, Beijing and other places.

During her first visit to China, Boruarte said she was surprised by China's performance in energy transformation, infrastructure innovation and other fields. At the same time, she also asked Xi Jinping to help Peru attract more Chinese investment.

By attracting Chinese capital and technology to participate in its infrastructure construction, Peru has not only eased its own pressure on capital and technology, but also further consolidated and deepened its friendly and cooperative relationship with China.

On the afternoon of June 28, President Xi Jinping held talks at the Great Hall of the People in Beijing with President Boruarte of Peru, who was in China for a state visit. Prior to the talks, Xi Jinping held a welcoming ceremony for Boruart in the plaza outside the east gate of the Great Hall of the People. Photo by Xinhua News Agency reporter Liu Weibing

On June 27, 2024, Shanghai hosted a forum on "Investment Opportunities in Peru" attended by Peru's President Boruarte and Minister of Transport and Communications Raúl Pérez Reyes.

The two gave an impassioned speech. At the forum, the President extended a cordial invitation to global entrepreneurs, particularly friends from China, stating that Peru "welcomes investors from around the world, particularly Chinese companies, to invest in Peru and participate jointly in the economic development and social construction of the country."

Peru's Minister of Transport and Communications detailed the six major railway projects promoted by the country, with a total investment of more than $31 billion, which aim to further improve Peru's rail network.

The minister emphasized the broad prospects for cooperation with China in the field of transportation and expressed the desire to sign a cooperation agreement or establish a joint fund with China so as to promote in-depth cooperation between the two countries in the field of transportation infrastructure construction.

Peru's Minister of Transport and Communications presented in detail the six major projects his ministry is promoting in the railway system, including the Lima-Ica, San Juan de Mar, and Port Kona-Andahuilas projects. Also in the pipeline are outline studies on the Puerto Cona-Andahuaylas and Lima-Barranca railways, with an investment of more than $21 billion; the Lambayeque-Caja Maca, Trujillo-Barranca and Idrélétrica-Quillabamba are in the conceptual stage, with an estimated investment of $10 billion.

Peru's Minister of Transport and Communications also held a working meeting with representatives from China Railway Construction and China Civil Engineering.

Peru strongly promotes Chancay port project

Peru's Minister of Transport also stressed the importance of the Port of Chancay, a project with an initial investment of US$1.3 billion and a 30-year concession period.

The project is one of the landmarks in Latin America for the construction of the Belt and Road, and includes a multipurpose terminal, container terminal, and infrastructure facilities. When completed, it will become a major transportation hub and logistics center along Latin America's South Pacific coast, greatly facilitating regional import and export trade.

The Peruvian delegation met with Wan Min, chairman of COSCO Shipping Group, and coordinated details of the future completion of the Port of Chancay.

Trade relations

The president said China is Peru's top export destination, accounting for 36 percent of Peru's total exports in 2023.

In recent years, Peru has given foreign investment access to a large number of facilitation initiatives. Peru was at a critical stage in its relations with China, with new investment opportunities in mining, infrastructure and digitization.

Geographically, Peru may be one of the most distant countries from China. However, in the field of economy and trade, China has been Peru's main trading partner and largest export market for nine consecutive years. The total trade volume between China and Peru accounts for 1/3 of Peru's total foreign trade, although only China and Peru have signed an understanding on cooperation for the joint construction of the "Belt and Road" memorandum in 2019, but back in the early 1990s, Chinese companies such as Shougang Group and PetroChina had already launched the first round of investment boom in Peru. In other areas, such as people-to-people exchanges, the relationship between China and Peru has lasted for centuries. The two countries are "housemates" across the Pacific.