A new Chinese megaport on the coast of Chancay, Peru, stands to threaten U.S. trading influence with resource-rich South America.
China Ocean Shipping Group, the port’s majority owner also known as Cosco, expects to open the massive facility later this year, Bloomberg reported.
The port is expected to bolster trade between Asia and South America for a variety of commodities and goods, including electric vehicles.
The U.S. is concerned this huge port could become South America’s first global trade hub that will allow China to further control the continent’s resources, deepen influence with the U.S.’s closest neighbors and place a nearby military installation.
The port, which will be the first on South America’s Pacific coast to accommodate megaships due to a depth of almost 60 feet, will enable companies to ship cargo directly between Peru and China instead of on smaller vessels that must first sail to Mexico or China, according to the Wall Street Journal.
Exports to China, which buys about two-thirds of Brazil’s iron ore and soybeans, must now be shipped by either going east via the Atlantic Ocean or north to access the Pacific Ocean via the Panama Canal.
This more direct route would come at a time when China is already deepening relations with South America.
Brazil, Latin America's biggest economy, wants to make semiconductors with China after refusing U.S. requests to exclude Huawei Technologies from 5G networks. Chinese companies are building a metro in Colombia's capital, Bogota.
Honduras has ended relations with Taiwan, hoping to receive a flood of Chinese investments, and China is buying up lithium mines in Argentina for making electric vehicles, Bloomberg reported.
Photo: Oleg Elkov via Shutterstock
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