Other inter-oceanic project on the books?

25 May 2019

When Presidents Evo Morales and Martín Vizcarra meet on 26 May, the project to build a rail link between Ilo and Santos (in Brazil) will be high on the agenda, as will the purchase by Peru of Bolivian natural gas.

The railway line which would run through Bolivia from east to west has been hotly promoted by Morales. Vizcarra, who has been transport minister in the past and comes from Moquegua (where Ilo is situated) is also a keen supporter. It would bring significant trade and investment benefits to his home region but without all the environmental complications of transit links through Amazonia.

The problem is partly the cost. Here, in an interview conducted with Reuters, Vizcarra declared that China is the obvious fit since it would be the main beneficiary of improved transport links. Last month, in the face of US protests about China, Peru signed up to China’s Belt and Road infrastructure initiative. 

If China is prepared to shoulder a large part of the cost, the project is likely to find more favour in Brazil where political changes and fiscal constraints make a large outlay problematic. German and Swiss firms have expressed interest in the project that would also link up with Paraguay and Argentina.

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