China-South America Trade Has Increased 40-Fold in 20 Years

Fri Jan 24 2025
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Key points

  • Major Chinese investments are focused on logistics and satellite communications
  • Xi Jinping and Peru’s president inaugurated one of the largest deep-sea ports
  • Beijing has also enhanced military ties with South American countries
  • Donald Trump may go for a more confrontational approach

SAO PAULO, Brazil:  China has enhanced its economic relations with South American countries in fields such as logistics, and satellite communications, boosting trade with the continent 40 times in 20 years as the US minimises its engagement in what it has traditionally considered and called its backyard.

According to Nikkei Asia, last month, the first cargo vessel, in this regard, to start from Peru’s Port of Chancay docked in Shanghai after a 23-day journey across the Pacific Ocean.

The new deep-water port, located near the Peruvian capital of Lima, significantly reduces shipping times by over 10 days.

Port inauguration

Chinese President Xi Jinping and Peru’s President Dina Boluarte, on Thursday, inaugurated one of the largest deep-water ports in South America.

It will also serve as a critical link in China’s Belt and Road infrastructure initiative.

Xi and Boluarte marked the starting through a video in the Government Palace of Peru in the aftermath of signing different trade memorandum of understanding agreements.

Top trading partner

According to the Council on Foreign Relations, China is among one of the top trading partners of South America and a big source of both foreign direct investment and energy and infrastructure lending, including through its huge Belt and Road Initiative.

Moreover, Beijing has also invested massively in Latin America’s space sector and has enhanced its military relations with several countries, particularly Venezuela.

Previously, policymakers in Washington have wanted new trade and investment avenues to push back against Beijing’s impact, but a second Donald Trump presidency could ignite a more confrontational approach.

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