Peru has taken steps to defuse tensions with China ahead of a high-profile meeting between President Dina Boluarte and Chinese President Xi Jinping by withdrawing its request to revoke exclusive operating rights from a Chinese state-owned company overseeing the construction of a major port on Peru’s Pacific coast, sources familiar with the matter said on Tuesday.
Earlier in March, the Peruvian government had initiated legal action to annul its decision granting Hong Kong-based Cosco Shipping Ports exclusive rights to operate the Chancay Port Terminal, citing what it termed an “administrative error.”
According to a source close to Peru’s port authority, a prosecutor from the transportation ministry formally requested the withdrawal of the original request on Monday. This move comes just days before President Boluarte is scheduled to meet with executives from Cosco and President Xi Jinping during her visit to China. The decision is seen as a significant step towards resolving the legal dispute that had raised concerns about potential international arbitration.
Peru’s port authority authorized the prosecutor to proceed with withdrawing the request, following legislative changes approved by Congress to amend Peru’s ports law. These changes were instrumental in clearing the path for Cosco Shipping to retain exclusive operational rights over the terminal under construction.
Representatives of Cosco Shipping in Peru declined to provide immediate comment on the Peruvian government’s decision.
Peruvian authorities have high hopes for the Chancay megaport, a $3.5 billion project expected to play a pivotal role as a hub in the South American Pacific region. However, the project has stirred geopolitical concerns, particularly among players in the United States and Europe, who view it as part of a broader pattern of increasing Chinese influence in Latin America.
Cosco Shipping Ports anticipates inaugurating the Chancay megaport in November, coinciding with the Asia-Pacific Economic Cooperation (APEC) leaders’ summit scheduled to take place in Lima. The project’s progress and the resolution of the legal dispute mark significant developments amid ongoing geopolitical dynamics in the region.
The decision to withdraw the request to revoke Cosco’s exclusive rights reflects Peru’s efforts to balance economic interests and geopolitical considerations. By maintaining constructive relations with China, Peru aims to leverage strategic infrastructure projects like the Chancay megaport to bolster its regional connectivity and economic development.
Looking ahead, the meeting between President Boluarte and Chinese leaders is expected to address bilateral cooperation across various sectors, including infrastructure, trade, and investment. The resolution of the port dispute underscores Peru’s commitment to fostering stable and mutually beneficial relations with China amid evolving global dynamics.
Peru navigates its diplomatic and economic strategies, managing relationships with major global powers such as China remains pivotal. The Chancay megaport project serves as a focal point in Peru’s infrastructure development agenda, highlighting the country’s aspirations to enhance connectivity and economic integration within the Pacific region.
Peru’s decision to withdraw its legal challenge regarding Cosco’s operating rights at the Chancay port reflects a strategic recalibration aimed at promoting stability and advancing economic interests. The upcoming diplomatic engagements between Peru and China are poised to set the tone for future collaborations, emphasizing the significance of infrastructure projects in fostering regional connectivity and sustainable growth.
