As Chinese President Xi Jinping begins a diplomatic tour of Latin America, his goal is clear: to show the world how China’s Belt and Road Initiative is expanding China’s influence globally, including through major infrastructure projects. One of the highlights of this trip was the opening of the new port of Chancay in Peru. The port, scheduled to open Thursday, is a major project that gives China more control over important shipping routes and trade in developing economies.

Port of Chancay: economic importance and key location

The port of Chancay, located 80 kilometers north of Lima, was built with $3.5 billion in financing, mainly from the Chinese company COSCO Shipping Corporation. The port is expected to become a key connection between Latin America and Asia, reducing transportation time between Peru and China by around 10 days. It will process up to a million containers and 160,000 vehicles each year, allowing Peru to export resources like lithium, copper, iron and soy. Other South American countries, such as Brazil and Chile, could also benefit as they exported $135 billion worth of goods to China in 2023.

Chancay is now part of a global network of 18 ports in which China has a majority stake, extending China’s reach and influence through the Belt and Road Initiative (BRI). Chinese state-owned enterprises, like COSCO, are leading these investments, giving China more control over important trade routes and increased economic power through these key ports.

However, local communities and environmentalists are concerned about the impact of such a large-scale project. Some worry about potential environmental damage and the risk that such investments could put countries in debt, forcing them to make economic or political compromises. Although Peru’s current economic stability reduces the immediate risk, concerns remain about the environment and how local authorities will manage the project’s impact.

China’s expanding global port network

Chinese investment in the port of Chancay is not an isolated project. China has financed ports in key regions around the world, including the Indian Ocean, the Middle East, Africa, Europe and South America. These ports are located on important trade routes, such as Djibouti (near a vital shipping passage), Gwadar in Pakistan, and Piraeus in Greece.

In Myanmar, Chinese investment in Kyaukpyu Port is a crucial part of the BRI. This port provides China with direct access to the Indian Ocean, helping it reduce its dependence on the narrow Strait of Malacca for energy imports. Through Kyaukpyu, China can transport oil and gas directly from Myanmar to its Yunnan province, strengthening its energy security and influence in Southeast Asia. However, there are concerns that Myanmar is becoming too dependent on China due to these large infrastructure investments.

China’s network of ports around the world is strengthening its control over global trade routes and building diplomatic relationships giving it potential influence over major maritime routes.

For example, in Djibouti, China’s commercial investments led to the creation of a naval base close to a US military base. Although the port of Chancay is currently focused on commerce, its location on the Pacific Ocean raises the question of whether it could be used for intelligence or military activities if tensions between the nations.

Dual-use ports and security concerns

By controlling ports, China could monitor the movements of other countries, including U.S. naval activities. Although China claims that these ports are intended solely for economic purposes, there are instances of Chinese warships using them, hinting at potential military applications. This “dual-use” capability raises security concerns, particularly in regions where China is not traditionally active and could impact the movements of U.S. and allied forces.

China’s port network aligns with a strategy known as the “String of Pearls,” which involves positioning ports along major trade routes to protect Chinese commerce and expand its influence. Ports like Gwadar in Pakistan and Hambantota in Sri Lanka are examples of economic projects that could also serve military purposes. With the port of Chancay located close to the Americas, there are concerns that it could increase China’s influence over Pacific trade routes.

Traditionally, the United States has dominated trade routes and military influence in Latin America, but China’s recent investments could shift that balance and push the world toward a more multipolar order. Ports like Chancay, strategically located on Latin America’s Pacific coast, showcase China’s growing reach beyond Asia and underscore the need for the United States to reevaluate its interests in the region.

The United States has responded with initiatives such as the Build Back Better World program aimed at providing sustainable infrastructure alternatives to the BRI. However, China’s massive investments in the BRI still outpace these efforts, which could lead Washington to strengthen diplomatic ties with Latin American countries and explore expanded military partnerships.

Economic implications for host countries

Chinese investments in ports help develop infrastructure, boost trade and create jobs. However, they can also make countries economically dependent on China. For example, Sri Lanka’s debt led it to lease the Hambantota port to a Chinese company to help it repay what it owed. In Latin America, there are concerns that too much reliance on Chinese infrastructure will limit their foreign policy freedoms, making their economies more vulnerable to pressure from China.

Countries must weigh the benefits of these investments against the potential long-term risks. For Peru, the new port of Chancay could strengthen its role as a trade hub on the Pacific, but it could also pose challenges in regulatory oversight, debt management and environmental protection.

A multipolar maritime world

China’s rapid expansion of its global port network is changing the balance of power on the seas, beyond just economics. When countries like Peru partner with China on major trade projects, they support China’s larger plan for economic connections through the BRI. For China, ports like Chancay help secure access to resources, strengthen economic ties and strengthen its influence in a world once dominated by Western trade and military alliances.

For the United States and its allies, China’s growing control over ports is a complex issue. As President Xi Jinping opens another BRI port in Peru, the question of China’s true intentions looms large. Ports like Chancay represent a new era where infrastructure is not just about trade. It is also a tool of global power that is moving the world toward a system where economic influence and strategic locations are as important as traditional military alliances.