CBN Special丨APEC in Lima time: China, Peru to build closer ties

Lima, the capital of Peru, enters “APEC time” this week as the South American country hosts the 31st Asia-Pacific Economic Cooperation (APEC) Economic Leaders' Meeting.

Under the theme of “Empower, Include, Grow,” senior officials, ministers and leaders from APEC's 21 member economies, which together account for almost two-thirds of world GDP and half of global trade, will tackle core challenges facing the Asia-Pacific region, including climate change, sustainable energy solutions, the digital economy transition and trade facilitation.

Spanning across the vast Pacific Ocean, China and Peru have long-lasting sincere friendship. Peru was one of the first Latin American countries to establish diplomatic relations and a comprehensive strategic partnership with China. It was also the first Latin American country to sign a package of free trade agreements with China.

The two countries have witnessed increasingly close economic and trade cooperation as well as cultural exchanges. Peru is one of the Latin American countries where Chinese immigrants first arrived and settled in large numbers. "Chifa," a word that originated from the Cantonese dialect for "having meals," has become the term that Peruvians use to refer to Chinese restaurants.

At the just concluded 2024 China International Import Expo (CIIE), an alpaca doll named Gordita traveled far from Peru to China to participate in the expo. The fluffy adorable alpaca doll captured the attention of many visitors. Moreover, toys crafted from alpaca wool by Peruvian artisans were also on display. From the first CIIE to the seventh, these Peruvian alpaca toys have been a part of every expo, showcasing their unique charm to China and the world.

Peru was also one of the first countries to benefit from Chinese cooperation. In 1992, the Shougang company of China acquired an iron mine in Marcona, Peru (one of China's first investments abroad). Since then, collaboration and cooperation between Peru and China have increased, with the two countries signing a free trade agreement in 2009, and raised the bilateral relationship to a comprehensive strategic partnership in 2013.

China's first investment in the Marcona iron mine was $120 million. Today, it has increased to $35 billion, spread across sectors such as mining, infrastructure, energy, communications and services.

In 2010, the FTA officially came into effect and serves as a catalyst for bilateral trade growth. In June of this year, the two countries announced the completion of negotiations on upgrading the FTA.

Thanks to the FTA, Peru's products have begun to reach Chinese households. Peru has become the largest supplier of blueberries and avocados to China, with products such as quinoa, grapes, maca, and alpaca wool, among others, gaining popularity in the Chinese market.

It is reported that China and Peru are actively negotiating on issues such as the export of high-quality Peruvian frozen fruits to China, and positive progress has been made.

The Chinese and Peruvian economies are highly complementary. With joint efforts from both sides, China has become Peru's largest trading partner for 10 consecutive years, and Peru is the second largest investment destination of China in Latin America.

In 2023, the bilateral trade volume reached $37.69 billion. According to Peruvian statistics, over the past 14 years, Peru's exports to China have grown by 325.9 percent, with an average annual growth of 13.2 percent, making Peru China's fourth-largest Latin American trading partner.

The signing of the FTA has greatly enhanced the level of trade between Peru and China. Since the agreement came into effect, Peru's non-traditional exports to China have increased by 227 percent, making Peru the second largest fruit supplier to China in Latin America.

Since China and Peru signed the memorandum of understanding (MOU) on Belt and Road Initiative cooperation in 2019, bilateral cooperation has achieved fruitful results, with increasingly close collaboration in the economy, trade, finance, culture and other fields. A notable milestones include the Chancay Port, a flagship project under the Belt and Road Initiative.

Chancay Port was officially inaugurated on Thursday, which will turn into a business hub of the Americas and trigger a true economic revolution in the region, directly boosting its development and reconfiguring the map of maritime routes in the Asia-Pacific region.

The Sino-Peruvian partnership is being continuously reinforced. Reputable Chinese companies in consortium with local companies are in charge of important projects in different regions of Peru, creating direct and indirect employment and contributing to Peru's development.

Among the emblematic projects are the construction of the San Gabán III Hydroelectric Power Plant, worth $500 million, in the forest region of Puno in southeast Peru, which includes the construction of an about 15-kilometer-long tunnel that will divert the waters of the river of the same name to generate 206 MW of electricity and feed the national interconnected system.

In the neighboring region of Cusco, another important Chinese company is building a road, including a 2-km-long tunnel, from Santa Maria to Machu Picchu, a UNESCO World Heritage Site, to provide easier and better access to the Inca sanctuary.

Peru is witnessing economic development on such a scale for the first time in its history thanks to its partnership with China, which is based on goodwill, mutual trust and mutual respect. Peru's development is an example of brotherhood and common destiny of two ancient civilizations, which will become an example for Latin America.

Executive Editor: Sonia YU

Editor: LI Yanxia

Host: Stephanie LI

Writer: Stephanie LI

Sound Editor: Stephanie LI

Graphic Designer: ZHENG Wenjing, LIAO Yuanni

Produced by 21st Century Business Herald Dept. of Overseas News.

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