The Trump administration on Wednesday expressed concern that China was costing Peru its sovereignty in solidifying control over the South American nation's critical infrastructure, a blunt warning after a Peruvian court ruling restricted a local regulator's oversight of a Chinese-built mega port. The $1.3 billion deepwater port in Chancay, along the Pacific coast and north of Peru's capital of Lima, has become a symbol of China's foothold in Latin America and a lightning rod for tensions with Washington. The US State Department's Bureau of Western Hemisphere Affairs said on social media that it was "concerned about latest reports that Peru could be powerless to oversee Chancay, one of its largest ports, which is under the jurisdiction of predatory Chinese owners," per the AP.
The post added: "We support Peru's sovereign right to oversee critical infrastructure in its own territory. Let this be a cautionary tale for the region and the world: cheap Chinese money costs sovereignty." Chancay is part of Beijing's "Belt and Road" initiative, an infrastructure program that has seen Chinese state-owned banks offer sizable loans or financial guarantees to construct seaports, airports, and highways, among other projects, across multiple continents. As Latin America's deepest port, Chancay is capable of berthing some of the world's largest cargo ships traveling between Asia and South America. China has been Peru's biggest trading partner for more than a decade now.
US concern comes as the Trump administration seeks to assert dominance over the Western Hemisphere, where China has long built influence through massive loans and high trade volumes. The Chinese government on Thursday strongly rejected the US comments. "China firmly opposes and strongly deplores the US' blatant rumor-mongering and smearing of Chancay port," said a Foreign Ministry rep. China's state-owned shipping and logistics company Cosco, a majority shareholder in the port, similarly dismissed the US claims.
The company said the court ruling "in no way involves aspects of sovereignty" and insisted that the port remains "under the jurisdiction, sovereignty, and control of Peruvian authorities, subject to all Peruvian regulations." It added there were plenty of Peruvian authorities monitoring the port's activities, including police forces, environmental regulators, and customs officials. The ruling issued Jan. 29 by a lower court judge orders Peruvian authorities to refrain from exercising "powers of regulation, supervision, oversight, and sanction" over the port.
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