(Yicai) Nov. 18 -- Peru’s Chancay Port, which was built by the Chinese, opened for business on Nov. 14, trimming the shipping travel times between China and Peru by a third, and drawing trade links between China and Latin America closer.

A new direct shipping route between Shanghai and Chancay, which is just north of Lima, has been launched. This route cuts the sea freight journey between China and Peru to 23 days from over 35 days and slashes logistics costs by over 20 percent.

The port is funded and operated by Chinese companies, reflecting their vision of Peru becoming a transport hub connecting the Asia-Pacific region with South America, Niu Haibin, director of the Institute for Foreign Policy Studies at the Shanghai Institute for International Studies, told Yicai.

Chancay Port is a deep-water port with a depth of up to 17.8 meters. The first phase, which has four berths, is designed to handle an annual throughput of one million twenty-foot equivalent units. It will eventually expand to reach a yearly throughput of 1.5 million TEUs. The port, which started to be built in 2021, is expected to generate USD4.5 billion in yearly revenue for Peru and create over 8,000 jobs.

Chinese goods heading for South America and vice versa will no longer need to go through ports in Mexico and the US. The new shipping routes will also benefit other countries on the west side of the Pacific Ocean, such as Japan and South Korea, as well as cities on the West coast of the US.

People in Brazil, Venezuela, Bolivia, Paraguay and Argentina will see Peru as the port to use when they want to send goods or travel to Asia, said Raúl Pérez-Reyes, Peru's minister of transport. Peru aims to become Latin America’s Singapore, he added.

Cargo trade between China and Latin America has risen substantially in recent years, hitting USD489 billion last year, according to a report from the United Nations' Economic Commission for Latin America and the Caribbean.

This year, the value of trade is set to top USD500 million. In the first three quarters, trade between China and Latin America jumped 7.7 percent year to year to USD427.4 billion.

And the two nations continue to draw closer. China and Peru agreed to upgrade the bilateral free trade agreement in Lima on Nov. 14, China's Ministry of Commerce said. The 31st Asia Pacific Economic Cooperation Economic Leaders' Meeting took place in Lima on Nov. 16.

Peru is China's fourth-largest trade partner in Latin America and a key investment destination while China has been Peru's biggest trading partner and export market for the last 10 years. Last year, the value of bilateral trade amounted to USD37.7 billion.

Editors: Shi Yi, Kim Taylor