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LATIN AMERICA ADVISOR

LATIN AMERICA ADVISOR

A daily publication Of the dialogue

August 8, 2024

Will Peru Proceed With Plans for New Infrastructure?

Peru’s president last month announced plans to build new infrastructure, including railroads to take advantage of the Chancay port, pictured, which is to open in November. // File Photo: Peruvian Government.

Q

  • Peruvian President Dina Boluarte on July 28 vowed to launch several new infrastructure projects in order to boost the country’s economy. The projects include seven new railroads that Boluarte said will help to increase mining and agricultural exports and also take advantage of the new $1.3 billion Chancay port, which is owned by Chinese state company Cosco Shipping and is to be inaugurated in November. How likely are the railroads and other infrastructure projects to be realized, and what would be their economic impact? How important is the port project, and what will it mean for Peru and other neighboring countries? How significantly does the port project expand China’s influence in the region?

A

Gonzalo Tamayo, partner at Macroconsult in Lima and former Peruvian minister of energy and mines: “Large-scale rail infrastructure projects require significant and ideally stable cargo volumes so they can be adequately financed with competitive freight rates. Cargo volumes ideally should be stable in both directions, otherwise the absence of load balancing will affect freight rates. These conditions are not easy to find in the highly centralized Peruvian economy, which has complicated geography due to the Andes mountain range and the Amazon jungle. Unfortunately, examples of the idea of ‘build it, they will come’ are common around the world. The development of mining-oriented rail projects is more likely. The new Port of Chancay is strategically important for Peru and the western coast of South America as it opens faster routes to the Asian markets. It will change the logistics, reducing…”

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The Inter-American Dialogue publishes the Latin America Advisor every business day for a distinguished membership of informed corporate leaders, scholars, and government officials invested in Latin America’s development and future. The Advisor‘s highly regarded Q&A section covers questions submitted by subscribers themselves. Commentators regularly include heads of state, business leaders, diplomats, economists, analysts, and thought leaders from around the world. Many of the world’s largest and fastest-growing companies subscribe to the Advisor. To subscribe, click here. For terms and conditions, click here. For more information, contact Gene Kuleta, editor of the Advisor, at gkuleta@thedialogue.org.
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Diego Arria
Director,
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Merike Blofield
Professor of Political Science,
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Devry Boughner Vorwerk
CEO,
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Joyce Chang
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J.P. Morgan

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GLG Inc.

James R. Jones
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Craig Kelly
Senior Director,
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US Education Finance Group

Nicolas Mariscal
Chairman,
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Thomas F. McLarty III
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Beatrice Rangel
Director,
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Ernesto Revilla
Head of Latin American Economics, Citi

Gustavo Roosen
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Andrés Rozental
President, Rozental &
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Shelly Shetty
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