Chancay-Callao Hub will inject US$10 billion each year

The new port and commercial hub that Peru is developing between Chancay and Callao, which will have the new Ancón Industrial Park as its logistical heart, is designed to generate annual income of more than US$10,000 million, equivalent to a growth of at least 1 additional point of GDP each year, starting from the tenth year of operations.

According to preliminary estimates from the Ministry of Economy and Finance (MEF), the greatest impacts on GDP will be seen from the fifth year of operations. To understand the dimensions of the new South American hub, it must be clear that the world’s international trade goes by ship.

Currently, Peru is the eighth country in the world with the highest number of trade agreements (22) and with a potential to continue expanding that was reflected in 2023, when, despite the difficulties that the global scenario was going through due to climate change , FOB shipments were recorded for US$64,474 million, according to the Economic Studies and Commercial Intelligence Area of ​​ADEX. This allowed it to enter 180 markets last year.

The Government’s idea is to strengthen connectivity between Chancay and Callao. The strategy has four axes: improve connectivity infrastructure and make the two ports function as one, increase exportable supply with a special economic zone (SEZ) in Ancón – so that ships do not leave Peru empty -, enhance capacity of the local shipyards, and a road plan that integrates the production chains in the mountains and the jungle to give them access to the sea.

Alex Contreras, former Minister of Economy, explains that three of them have positive progress. The most ambitious of these axes, which contemplated the construction or maintenance of ships with the SIMA of La Marina, became a reality with the arrival of Hyundai through a joint venture that will favor the naval industry along the entire coast. The Peripheral Road Ring, awarded a week ago, comes to add to the equation with the exportable supply that enters from the Central Highway.

“If we had done it 5 or 10 years ago, we would be talking about another country. But it is already being done and northern Lima is going to have its urban development plan to better plan the infrastructure. Therefore, the budget this year will be key,” resolves Contreras.

A competitive hub

Both Chancay, operated by Cosco Shipping, and the North and South docks of Callao, managed, respectively, by DP World and APM Terminals, will have a combined capacity to move 5 million TEU (with a view to expanding), one of the most powerful region of. However, they do not see each other as a threat.

In conversation with La República, the general manager of DP World Callao, Marco Hernández, welcomes the entry of the Chinese capital terminal to close the port gap that, in effect, still exists in the country. This week, they hope to inaugurate their Bicentenario pier.

Meanwhile, the general manager of Cosco Shipping Ports Chancay, Carlos Tejada, recognizes that the prices to move containers in his terminal could be somewhat higher than in his Chalaco peers to recover the investment initially, which is why he estimates a “healthy and intense competition.”

Peru will expand its FTA with China before the APEC 2024 summit: Chancay will be its “Golden Key”

The numbers accompany them, since the possibility of receiving ships with greater TEU capacity will be more than seductive for the joint exports of Brazil, Colombia, Chile and Ecuador to Asia, which will move more than US$150,000 million in 2023.

The key is in the new route to the east. Five markets on the Asian continent (China, India, South Korea, Japan and the United Arab Emirates) account for 95.2% of total exports. ADEX states that shipments to this continent are concentrated in traditional shipments. This situation creates a great challenge to increase efforts to expand the presence of Peruvian supply and diversify shipments to that region.

“Better coordination between all ports is essential and positive to attract more investments. But closing the infrastructure gap must be accompanied by a reduction in port overcharges; it is important that Customs be a trade facilitator rather than an inspector,” says Favio León, president of the Peruvian Association of Port Operators (Asppor).

Industry and more work

The hub would not be complete if it did not have large spaces with benefits for productive diversification. It is not necessary to go far to find these areas of prosperous development for the industry, as Colombia has several in operation.

The experience in our country has not been ideal, but the MEF hopes that the Ancón Industrial Park, a US$760 million project, can change this reality. The expected impact? US$280 million in exports and more than 120,000 direct and indirect jobs, thanks to the installation of 234 companies in the food and beverage sectors; wood, paper, chemicals; textiles, leather, footwear and others, which guarantee an occupation of almost 400 hectares.

Although the location of the Ancón Industrial Park is ideal for the industry because it is between Chancay and Callao, the access to the sea of ​​the Peruvian exportable supply will not be limited to the closed circuit of the new hub.

The Ministry of Transportation and Communications (MTC) has planned to enhance the IIRSA North road axis and one of the goals is to improve the section that goes from Yurimaguas to Moyobamba and from Moyobamba to Paita. As for the south, there is the South Interoceanic Highway and the development of the Ilo port concession is pending to enhance its value.

The idea is that all exportable cargo (Peruvian or international that arrives by road) leaves, in one way or another, towards the sea, and from there it could be connected to the Chancay-Callao hub by ship through cabotage. However, the project to allow this cost-efficient mode of transportation is still stalled in Congress. Time will tell.

Compete and prosper for Peru

Jessica Luna, dir. Comex Executive

At Comex Peru, we are responsible for leading the APEC 2024 business council. In a year in which Peru has the presidency, the construction of Chancay is of vital importance not only because it will increase the commercial border of our imports and exports, but because It will strengthen and redefine the role our country plays in international markets.

We are talking about logistical and economic development around the port, not only infrastructure, but also new value and distribution chains. There are companies from Brazil and Chile that have contacted us to buy and use land in that area to carry out assembly and various production processes that reduce deadlines and costs.

The more ports and actors there are, the quality of service for foreign operators will improve. When there is competition, not only the importer and exporter benefits, but also the consumer. A hub between Chancay and Callao will reduce travel times to Asia.

Callao, where we have first-class terminals and the best services, has become a bottleneck. Access has collapsed and generates cost overruns and insecurity that affect the chain.

Something that cannot wait any longer is the Callao port, this area where trucks wait to have their turn, but which, in the process, affect the population. The private sector is eager to contribute to the works around this circuit, but first the Government must make the rules clear to have predictability.

Brazil, Peru’s next key trading partner

Soybean and corn producing states in Brazil, such as Acre and Rondonia, are located on the border with Peru. The South American giant lives with its back to China and seeks to connect the Pacific through a bioceanic train to Chancay.

In Latin America, Brazil is the second destination for Peruvian exports, only behind Chile.

However, the Pacific highway is also being studied, which runs from Assis (Acre, Brazil) and Iñapari (Madre de Dios, Peru) to the ports of Ilo, Matarani and Chancay.

There is also a multimodal route project: Amazon Waterway, from Tabatinga (Brazil) and Iquitos to Yurimaguas and land routes to Paita.

Currently, Peru does not have an FTA with Brazil. The decision was frozen in the hands of Congress.

The data

90% of Peru’s cargo leaves today through Callao. It is expected that Chancay can redirect 30% of this towards the north.