Located in different hemispheres and separated by the vast Pacific, China and Peru have enjoyed a long-lasting friendship, with frequent high-level visits, close trade and active civil exchanges, said Gao Jinbao, commercial counselor at China’s embassy in Peru.
Following the China-Peru Free Trade Agreement signed in 2009 and an all-round strategic partnership established in 2013, the two countries made “abundant achievements in many fields”, he said.
Peru is the only Latin American country that has an allround strategic partnership and free trade agreement with China.
In 2011, China overtook the United States for the first time to become Peru’s largest trading partner and export market, and became its largest import source in 2014.
“Even with the downturn of the international market and the slump of bulk commodity prices, the performance of Peru’s exports to China was better than that to the US, Switzerland, Brazil and the other most important foreign markets, which to some extent eased the decline of its export business,” Gao said.
China is not only Peru’s largest consumer of mineral products and fish powder, but is becoming an increasingly important market for its nontraditional products.
“Peruvian squid, grapes, seaweed powder and pisco have enriched Chinese people’s dining tables, and related businesses have created many new jobs in Peru,” Gao said, adding that China is now a major provider of telecommunications equipment, vehicles and engineering machinery in Peru.
Many Chinese brands, including Huawei, ZTE, Foton, Lenovo and Sany, are popular with Peruvian consumers.
In 1992, Beijing-based steel company Shougang Group acquired Hierro Peru, and China National Petroleum Corp won the bid of oilfield Block 7 in northwestern Peru’s Talara, marking the beginning of the overseas expansion of Chinese mining and oil businesses.
Over the past two decades, China has grown into one of Peru’s most important investment sources, and Peru is now China’s second-largest investment destination in Latin America.
By the end of last year, some 150 Chinese companies had operations in Peru, with total investment of more than $14 billion. They are involved in a wide range of businesses including agriculture, processing, the building industry, banking and logistics.
The counselor said that Chinese companies are taking the lead in Peru’s wood, seaweed and tara processing and exportation, and many are also paying attention to sectors such as electric power, building materials, infrastructure, metallurgy and manufacturing, seeking potential projects.
The Industrial and Commercial Bank of China is the first bank from Asia to enter the Peruvian market.
“Both China and Peru now face challenges as the global economy recovers slowly,” Gao said. “But the economies of the two countries can complement each other, with a sound foundation and great potential for cooperation.
“The two governments, as well as the business circle, have full faith in and passion about their bilateral trading partnership. Both sides should work together to achieve mutual benefits by seeking new potential areas.”
He suggested diversified investment from China in Peru’s energy and resource sector, hydraulic power, infrastructure, manufacture, processing and industrial parks, to modernize local traditional industries.
In the framework of the free trade agreement, the two sides can explore more opportunities of trade in goods and may have more cooperation in service trade and e-commerce.
Gao also called for more exchanges in science, education and culture, along with training and technology transfer, to develop high-quality human resources that can serve as “a lasting and strong force” for future China-Peru cooperation.