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Special Issue - Redefining Alliances: The impact of China´s Rise on Latin American International Relations • Rev. Bras. Polít. Int. 68 (2) • Sept 2025 • https://doi.org/10.1590/0034-7329202500220 linkcopy

Open-access Impact of China–Latin America Transportation Infrastructure Cooperation on Latin American Economies: A Project Data Study (2009–2023)

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Abstract

Since the beginning of the 21st century, China and Latin American countries have actively collaborated across various fields, including politics, economy, culture, and technology. Transportation infrastructure cooperation has emerged as a key aspect of this relationship. This article analyzes the characteristics of China–Latin America transportation infrastructure cooperation using project data from 2009 to 2023 and evaluates its effectiveness and future prospects. The findings indicate that this cooperation has yielded significant achievements; however, challenges remain in areas such as communication with indigenous communities and environmental protection. Moving forward, it is essential for China and Latin America to deepen their collaboration, prioritize quality projects through strategic planning, and promote the green development and digitalization of transportation infrastructure.

Keywords:
China; Latin America and the Caribbean; transportation; infrastructure; integration

Introduction

Relevant Concepts

The term “infrastructure” refers to the physical engineering facilities that provide public services for social production and residents’ daily lives, forming a public service system that ensures the normal operation of socio-economic activities within a country or region. It has a broad scope, encompassing both hard and soft infrastructure. Hard infrastructure refers to the physical systems required for operating modern industrialized countries, including roads, highways, and bridges, as well as the assets necessary for their operation, such as public transit buses, vehicles, and refineries. Network equipment and cabling systems also fall under hard infrastructure. Soft infrastructure, on the other hand, refers to the human capital and institutions necessary for maintaining economic development. This includes healthcare, financial systems, government agencies, law enforcement, and education (Investopedia Team 2025). Transportation infrastructure specifically pertains to the physical elements and networks that facilitate the movement of people, goods, and services within society, including roads, railways, airports, ports, and other related facilities (Taylor 2021). Transportation infrastructure is a vital cornerstone of socio-economic development, playing a significant role in driving economic progress at national, regional, and global levels. Efficient transportation infrastructure can reduce transportation and logistics costs while increasing the flow of resource factors—human, material, and financial—thereby enhancing productivity and innovation.

China views infrastructure construction as a crucial engine for economic development. A popular slogan in China during the 20th century was: “To get rich, build roads first,” reflecting the government’s emphasis on infrastructure. In the early 1950s, China initiated large-scale infrastructure construction, with landmark projects including the Wanshou Mountain Reservoir, South China University Town, and Dalian Port. The launch of the first Five-Year Plan in 1953 marked the beginning of extensive planned economic construction. During the 1997 Asian financial crisis, China intensified its focus on infrastructure development as a means to stimulate the economy. In response to the global repercussions of the 2008 subprime mortgage crisis, China implemented a four trillion-yuan investment plan specifically targeting infrastructure projects (National Development and Reform Commission of China 2009).

China’s experience has validated the benefits of infrastructure investment. From 1990 to 2005, it invested $600 billion in upgrading its road system, centered on the national expressway network, which spans over 41,000 kilometers and ultimately connects all cities with populations over 200,000. Without this expressway network, China’s real national income would have declined by 6% in 2007 (Sahoo et al. 2010). As a result, China has accumulated extensive experience in infrastructure development. In the past two decades, as economic globalization has progressed, China’s economic activities in Southeast Asia, Africa, and Latin America have expanded, leading to increased infrastructure investment and construction cooperation across several countries. The cooperation model has evolved from traditional engineering contracts to include financing and operational components. Notably, the “Belt and Road Initiative” proposed by China has emerged as a significant vehicle for its infrastructure cooperation abroad.

The Latin America and Caribbean Region is characterized by relatively low levels of infrastructure. According to the World Bank’s Logistics Performance Index, the region scored 2.69 in 2022, below the global average of 3, and only higher than Sub-Saharan Africa and small island nations in the Pacific (World Bank 2023). Moreover, Latin America has long grappled with issues related to insufficient infrastructure investment. Studies indicate that to achieve the infrastructure development goals outlined in the 2030 Sustainable Development Agenda, the region needs to invest at least $2.22 trillion (Brichetti et al. 2021). Since the early 21st century, China has been actively advancing infrastructure cooperation with Latin American countries. In 2017, Chinese President Xi Jinping stated that “the Latin American region is a natural extension of the 21st Century Maritime Silk Road,” signaling a new acceleration in China–Latin America infrastructure cooperation (“China, Argentina pledge to strengthen bilateral ties.” 2017). This raises an important question: What economic and social impact has China–Latin America infrastructure cooperation had on the economic development of Latin American countries? The author tries to answer this question by analyzing the data of China-Latin America transportation infrastructure projects and making some case studies towards specific projects.

This article consists of five main parts in addition to the introduction. The first part provides a brief review of the relevant literature on China-Latin America transportation infrastructure cooperation and introduces the research methodology employed in this study. The second part analyzes the characteristics of China-Latin America transportation infrastructure collaboration over the past fourteen years (2009-2023). The third part examines the socio-economic impacts of these cooperative projects on Latin America. The fourth part analyzes the risks and challenges faced by China-Latin America cooperation in transportation infrastructure. The final section presents the conclusion.

Literature Review

Currently, academic research on China-Latin America economic and trade relations has grown substantially, with a particular focus on Belt and Road cooperation and infrastructure collaboration. Scholars from various backgrounds have explored opportunities, challenges, cooperation models, and impacts, forming a rich body of literature.

Chinese scholars primarily focus on analyzing the practical paths, risks, and policy recommendations for China-Latin America infrastructure cooperation, with specific attention to institutional mechanisms and project implementation. Research has been conducted on infrastructure integration under the Belt and Road Initiative, which argues that railways are critical to both the Initiative and South American infrastructure integration. A proposed “four horizontal and two vertical” railway network includes four east-west ocean-connecting railways and two north-south lines to boost regional links (Xie 2016). It was recommended to use the China-Latin America Forum to prioritize connectivity, establish multi-level cooperation, and focus on ten inter-ocean corridors as key intercontinental projects (Xie 2018).

Some Chinese scholars analyze China’s infrastructure engagement in Latin America from an economic diplomacy perspective, noting that cooperation models have diversified. Chinese enterprises’ participation in Latin American public infrastructure has evolved from traditional service outsourcing, management outsourcing and leasing, to emerging Public-Private Partnership (PPP) models (Cui and Zhang 2017). They also point out that Chinese enterprises have low participation in Latin American PPPs compared to their involvement in engineering contracts, indicating significant room for growth (Chen et al. 2017). Some Chinese scholars have analyzed the challenges China faces in infrastructure cooperation in this region. Through case studies of major projects, they concluded that the regional context is the most critical factor determining the success of Chinese investment in mega-infrastructure (Haibin 2018; Wang 2020). It is advised that Chinese enterprises engage in joint bidding, learn from localized operational experiences of overseas developers, cultivate local talent, understand local bidding procedures, and monitor host countries’ debt sustainability and adherence to agreements (Bai and Kai 2024).

Scholars from Latin America, the United States and Europe focus more on the regional impacts, socio-economic consequences, and geopolitical dimensions of China-Latin America infrastructure cooperation. Enrique Dussel Peters, James A. Cook, and Joseph S. Alter edited “Connecting China, Latin America, and the Caribbean: Infrastructure and Everyday Life”, which comprehensively documents China’s involvement in Latin American infrastructure. Through case studies in Brazil, Ecuador, Peru, and Jamaica, the book illustrates how such projects link economic sectors and foster economic and cultural ties embedded in local daily life. Some scholars evaluate China’s influence in Latin American infrastructure, finding significant variation across countries. They highlight Chinese companies’ adaptability to local institutions (Bersch and Koivumaeki 2019).

Some experts argue that while China has become one of the most important infrastructure finance investors in LAC, it did not change the region’s position in the global value chains, nor did it enable possibilities of transformation on the development models dependent on the export of commodities (Neves and Honório 2024). In examining China’s influence on Brazil’s infrastructure development, Hiratuka (2018) argues that the key to whether China-Latin America infrastructure cooperation can bring positive effects to Latin American countries lies in whether these countries can effectively integrate Chinese investment into their own development strategies. Ruben Gonzalez-Vicente (2021) acknowledges that Chinese infrastructure projects in the Caribbean have boosted local economies, demonstrating China’s capacity to operate in heavily indebted nations. However, he argues that the Belt and Road Initiative represents a continuation of neoliberal, business-centric development in the region, failing to deliver qualitative socio-economic change. Some scholars investigate whether China’s infrastructure project cooperation in Latin America carries political motives. Some of them suggest that there are no evident signs that an inability of servicing Chinese loans (which underwrite the bulk of China’s infrastructure projects in the region) is used for the sake of gaining political leverage (Oosterveld et al. 2018, 44).

Some scholars have also evaluated the factors that affect the effectiveness of infrastructure cooperation projects. Margaret Myers (2018) underscores that the extent to which Latin American countries can benefit from the Belt and Road Initiative largely depends on their governments’ political coordination abilities and strategic planning. Leolino Dourado (2022) investigates the failed Brazil-Peru Transcontinental Railway project, attributing its collapse to inadequate planning and feasibility studies. He suggests Chinese stakeholders should improve study quality and emphasizes the importance of host countries’ institutional and technical capacity. After analyzing the differing cultural and traditional perspectives on state-society relations in Brazil and China, Hearn (2015) put forward that enhancing transparency represents the optimal approach to alleviate international worries regarding investments by Chinese state-owned enterprises (SOEs).

Overall, existing literature on China-Latin America infrastructure cooperation is dominated by macro-level analyses, which discuss transportation infrastructure, power infrastructure, telecommunications infrastructure, and other types together. There is also a small number of articles that have studied infrastructure projects between China and specific Latin American countries, such as Brazil and Peru. However, overall research on China-Latin America transportation infrastructure projects is quite rare. Few scholars have sorted out and analyzed the overall situation of China-Latin America transportation infrastructure in recent years. There are also few scholars who have conducted in-depth analyses of the impact of such projects on the local economy. Future studies can address this gap by focusing on micro-level project evaluations and quantitative analyses of economic impacts.

Methodology

This paper adopts a combination of quantitative and qualitative methods to analyze China-Latin America transportation infrastructure cooperation projects from 2009 to 2023, and conducts case studies on key projects between China and some Latin American countries, aiming to examine the impact of China-Latin America transportation infrastructure cooperation on the economy of Latin America.

When analyzing the impact of China-Latin America transportation infrastructure projects on the Latin American economy, the author applies the fundamental concepts of New Economic Geography to examine selected project cases. In 1991, Krugman published the paper “Increasing Returns and Economic Geography in the Journal of Political Economy”, putting forth the New Economic Geography Theory for the first time. Economic geography is “the location of production in space,” the most striking feature of which is its agglomeration or concentration--“clear evidence of some kind of increasing returns” (Krugman 1991). He further elaborated on this theory in a series of subsequent works and argued that traditional regional economic theories, based on the strict assumptions of neoclassical economics, neglected such key factors as “economies of scale” and “imperfect competition”, which resulted in the long-term neglect of spatial issues. With the development of relevant analytical tools, spatial issues have been incorporated into the research scope of mainstream economics.

Krugman puts forward some propositions in his books: (1) Transportation Costs play a key role in international trade and inter-regional trade; (2) Transportation cost is a core variable affecting the spatial distribution of industries. When transportation costs are high, enterprises tend to be scattered in layout to be close to local markets; when transportation costs decrease (such as the improvement of highway and railway networks), enterprises will gather in regions with “great market potential” (such as large cities and transportation hubs); (3) If information about new technologies flows and becomes more accessible within a particular region compared to others, then firms clustered in that region are more likely to benefit from positive externalities than those located farther away (Krugman 1991; 1995). The author applied the above perspectives when analyzing the impact of China-Latin America infrastructure cooperation on the Latin American economy. Additionally, the author argues that the construction of certain green transportation infrastructure projects has contributed to energy conservation and emissions reduction in Latin American countries.

The research hypothesis of this paper is that China’s transportation infrastructure construction projects in Latin America have a facilitating effect on regional economic development. The independent variable is China’s infrastructure project construction in Latin American countries, while the dependent variable is the economic development of the Latin American region. The author argues that the socio-economic impact of transportation infrastructure projects on Latin America can be analyzed from the following perspectives: First, from the standpoint of their role in enhancing intra-national connectivity, regional integration within Latin America, and interregional linkages. Second, the improved connectivity helps Latin American countries reduce logistics costs, promote regional balance, and facilitate technology transfer.

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Table 1
– Research hypothesis (compiled by the author)

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Figure 1
– Theoretical framework

This study is based on the China-Latin America infrastructure projects database from the China-Mexico Research Center at the National Autonomous University of Mexico, supplemented by additional data collected from the official websites of Chinese and Latin American governments and enterprises, forming the foundation of this research.

Characteristics of China’s Infrastructure Construction in Latin America (2009–2023)

This paper primarily references statistical data from Professor Enrique Dussel Peters’ team at the National Autonomous University of Mexico, supplemented and updated with information obtained from official sources such as the Chinese Ministry of Foreign Affairs, the Ministry of Commerce, and various Chinese enterprise websites.

According to the statistics, among 85 projects, road projects account for 34; port, dock, and river projects account for 19; railway projects account for 14; and subway projects account for 6. Additionally, bridge and airport projects each account for 5, along with two large-scale integrated projects.

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Figure 2
– Distribution of China’s transportation infrastructure projects in Latin America (2009–2023)

In terms of country distribution, the 85 projects are spread across 21 Latin American countries that have established diplomatic relations with mainland China, covering Mexico, Central America, the Caribbean, and South America. Among these, Bolivia, Argentina, and Brazil are the countries with the highest number of projects, each exceeding 8 projects.

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Graphic 1
– Number of transportation infrastructure projects in Latin American countries in cooperation with China (2009–2023)

Based on the number of projects obtained from various years, it is clear that there has been a significant increase in transportation infrastructure projects since 2018. If we review the major events in China-Latin America relations in recent years, we will find that in January 2018, the Second Ministerial Meeting of the China-CELAC Forum held in Chile issued a special statement on the Belt and Road Initiative, marking the comprehensive extension of the initiative to this region (Bo 2018). Since then, Chinese companies have actively participated in the transportation infrastructure construction of Latin American countries. Notably, countries such as Bolivia, Brazil, and Argentina have seen substantial growth in their project numbers. Additionally, countries that established new diplomatic relations with mainland China, such as Panama, the Dominican Republic, and Nicaragua, have also contributed to this increase.

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Graphic 2
– Number of transportation infrastructure projects by China in Latin America (2009–2023)

In terms of project nature, new builds, expansions, and renovations are all included. Subway and bridge projects are primarily new builds, while projects related to roads, railways, airports, and ports include both new constructions and expansions/renovations. The forms of Chinese enterprise participation in these projects are also diverse, including both contracted projects and those with significant investments plus construction. For example, the project Rehabilitación de la carretera Santa Cruz-Trinidad-Cuatro Cañadas-Núcleo II, contracted by China Harbour Engineering Company in 2018, has a total funding of $26.07 million, with 22.89% coming from the World Bank International Development Association (IDA) and 77.11% from the International Bank for Reconstruction and Development (“Rehabilitación de la carretera Santa Cruz-Trinidad-Cuatro Cañadas-Núcleo II.”, 2025). Since the proposal of the Belt and Road Initiative, China has intensified efforts to promote global infrastructure connectivity and emphasized providing financial support for infrastructure cooperation projects through some national banks. As a result, Chinese enterprises have also increased their investments in transportation infrastructure cooperation in Latin America in recent years. For example, the port project in Peru, Chancay Port, is controlled and developed by China COSCO Shipping Ports Limited, with the company holding 60% of the equity in Chancay Port. In March of 2025, Chinese company Cofco International, one of the world’s leading commodity trading companies, has inaugurated the first phase of its export terminal at the Port of Santos, with total investment of $285 million (Pressinott 2025).

Based on their role in enhancing connectivity, China-Latin America transportation infrastructure cooperation projects cover domestic, intra-regional, and inter-regional connectivity.

Domestic connectivity involves the construction of roads, railways, airports, bridges, and subways, all of which have played a significant role. Among them, the transportation infrastructure projects undertaken by Chinese enterprises in Bolivia primarily focus on road construction, promoting traffic connections between various regions and provinces. The Doble vía Montero-Yapacaní project, undertaken by China Power Construction, is part of the expansion of Bolivia’s National Route 4, located in Santa Cruz Province, starting from the western suburbs of Montero and ending at the Yapacaní Bridge, with a total length of 69.7 kilometers. Chile’s Route 5 Road project, from Tarcahuano to Chillán, constructed by China Railway Construction Corporation, promotes connectivity between northern and southern Chile. The Bolivian Padia-El Salto Road project, also constructed by China Power Construction, spans 50.24 kilometers, passing through 11 villages, and serves as a major trunk road connecting the country’s capital, Sucre, and its largest economic city, Santa Cruz. The road project from Huánuco to Wayanco in Peru connects the Andes Mountains with the Pan-American Highway, covering 236.6 kilometers. Once opened, it will provide convenient transportation conditions for 243 local towns, directly benefiting 272,000 people. The Bogotá Metro Line 1 in Colombia, which stretches 23.9 kilometers and has 16 stations, will facilitate travel for over 3 million residents. The Salvador-Itaparica Bridge, invested in and constructed by Chinese entities in Brazil, is one of the country’s largest infrastructure projects and will benefit 250 cities, significantly reducing travel time for residents.

The Belgrano Railway in Argentina is the most important railway in the country’s network, connecting the northern provinces with Buenos Aires and the port of Rosario. It plays a significant role in facilitating trade with neighboring countries such as Brazil, Chile, and Uruguay, and in promoting the development of the Southern Common Market. The Amazon dredging project in Peru is a regional priority project that the Peruvian government has promoted for many years. It is crucial for improving and enhancing the shipping capacity in the Amazon, reducing logistics costs and increasing economic competitiveness.

Many infrastructure projects simultaneously promote connectivity within and between regions. Examples include the Panama Canal ports, Chancay Port in Peru, and international airports. The Road Expansion Project No. 32 in Costa Rica, currently under construction by Chinese firms, is the largest comprehensive initiative between China and Costa Rica. This road connects the capital San José to the vital eastern port of Limón, passing through key cities such as Guápiles and Siquirres. As the most crucial logistics corridor in Costa Rica, this road handles approximately 80% of the country’s import and export freight, and locals refer to it as the “artery” of national transportation. The ongoing construction of Colombia’s Mar 2 highway project aims to connect inland cities with ports to facilitate the export of products from the country.

The Role of China’s Transportation Infrastructure Construction in the Economic Development of Latin America

Reducing Transaction Costs and Promoting Regional Connectivity

The economic benefits of transportation infrastructure can be significant. To grasp the transformative potential of transportation infrastructure, one must first recognize its critical role in curbing logistic costs – a key determinant of economic efficiency and global competitiveness. Paul Krugman’s work (1991) emphasizes the role of transportation costs in shaping patterns of economic activity, particularly in the context of increasing returns to scale and agglomeration.

Official data reveals a significant gap in logistics costs between developed and developing nations. According to the World Bank, logistics costs in the United States account for about 8% of GDP, while this figure is approximately 15% to 20% for middle-income countries and around 30% for low-income countries (Arvis et al. 2024). The Development Bank of Latin America reports that in 2019, transportation costs in South America were the highest globally, 15% higher than those within the European Union, and only second to the Middle East and North Africa (Sanguinetti 2021). A report from Brazil’s National Center for Transatlantic Navigation in 2023 indicates that Brazil lags approximately 15 years behind countries with large port complexes in port infrastructure development (Malheiros 2023).

Through measures such as renovation, expansion, and construction of shorter connecting routes, the China-Latin America transportation infrastructure cooperation projects have enhanced the transportation capacity of Latin American countries and reduced logistics costs. Data already indicates that transportation infrastructure projects carried out by China in Latin America have reduced the transit time of local people and commodities. For example, the North-South Highway Project in Jamaica completes the link between the capital city of Kingston in the south with the tourist city of Ocho Rios in the north, halving the two-hour travel time between the two cities (“Newly opened Jamaica highway cuts Kingston to Ocho Rios driving time in half.” 2016). The road expansion project from Huánuco to Wayanco in Peru, undertaken by China Railway 12th Bureau, spans 237 kilometers and serves as a major passage from the Andes Mountains to the outside world. Once completed, it will connect with the Pan-American Highway, benefiting 270,000 people in 243 towns along the route by facilitating travel and reducing logistics costs (Ministerio de Transportes y Comunicaciones 2023).

Since 2020, Chinese enterprises have participated in the renovation projects of Argentina’s Belgrano Freight Railway and San Martín Freight Railway, among others. According to a report published by the Rosario Board of Trade, between 2020 and 2021 the amount of freight transported increased by 49.2% on the San Martín railway and by 41.4% on the Urquiza line, while the Belgrano line recorded a 14.6% growth (Sesé 2022). After the Chancay Port became operational, the time for South American goods to reach China, Korea, and Japan was reduced from 35-40 days to approximately 23 days, bypassing traditional routes through North American ports (Mendoza 2024). Among Peru’s products exported to China by sea, fish products as well as fruits like blueberries and grapes occupy a significant position. These products are not easy to preserve and have high requirements for logistics timeliness. The opening of the Chancay Port can greatly ensure the freshness of Peru’s export products and enhance their competitiveness in the Asian market. It is reported that since its opening, the import and export value and variety of goods at the Chancay Port have been on the rise. Among them, the export value has exceeded 139 million US dollars, mainly including blueberries, avocados, palm oil, grapes, etc., which are exported to China, Mexico, the United States and other places (Yang 2025).

Through cooperation with China in infrastructure construction, Latin American countries not only enhanced domestic connectivity, but also promoted regional integration. By strengthening connectivity with countries outside the region, some Latin American countries have attracted neighbors to enhance their connections, further advancing integration in Latin America. For example, the Chancay Port in Peru was linked to the Pan-American Highway through a tunnel, greatly increasing interest from surrounding countries. Brazil and Bolivia, among others, have re-prioritized the Twin Ocean Railway project, hoping to establish a connection to Chancay Port and thus boost their foreign trade (“Bolivia y Brasil tratan la construcción del tren bioceánico y el emplazamiento de planta de urea.” 2024).

Optimizing Spatial Economic Structure

New Economic Geography Theory recognizes the impact of transportation infrastructure on the spatial distribution of economic activities. Transportation costs constitute a core variable shaping the spatial distribution of industries. As transportation costs decline, firms are inclined to agglomerate in regions boasting substantial market potential, such as major urban centers and transportation hubs (Krugman 1991). The urban or industrial densities that are experienced by firms are determined by the ease of access to other firms, to consumers and to labor markets. This accessibility or proximity is in turn partly dependent on the nature of transport provision. In effect, transport investment can change urban or industrial densities by rendering a larger scale of activity more accessible (Graham et al 2009).

As we know, Latin America is one of the regions with the highest income disparity and the most severe inequality globally. There has long been a developmental imbalance between economic core areas (such as coastal megacities) and peripheral areas (such as rural inland regions). The United Nations Economic Commission for Latin America and the Caribbean reported that the poverty rate in the region was 27.3% in 2023, with the poverty rate in rural areas (39.1%) being higher than that in urban areas (24.6%). At the same time, income inequality in Latin America is extremely severe. Statistics from 2021 show that the top 10% of high-income individuals hold 66% of social wealth, while the richest 1% possess 33% of social wealth (Comisión Económica para América Latina 2024).

Many infrastructure projects in which China is involved in Latin America extend transportation networks to peripheral areas, activating inland resource endowments. First, the construction of transportation infrastructure itself is a massive economic activity, involving multiple related industries such as construction, steel, cement, and engineering machinery. For example, Chancay Port will form a multifunctional port and industrial node, including logistics, industrial zones, service and technology complexes, and even residential areas, providing numerous job opportunities for local residents and promoting the sustainable development of the local economy and society (Mendoza 2024). During construction, a total of 1,300 direct jobs and about 8,000 indirect jobs have been created, bringing tangible benefits to the local people (Yunyi and Jingjing 2024). The Maya Train in Mexico improves the infrastructure of the Yucatán Peninsula, stimulating local economic vitality and promoting tourism development. It is estimated that by 2030, this project will bring in 2.1 billion Mexican pesos annually for the Yucatán Peninsula and create 715,000 new jobs in 16 towns, with 46 out of every 100 jobs coming from local villages. The poverty rate is also expected to decrease effectively, with 1.1 million people projected to escape poverty by 2030 (United Nations Human Settlements Programme 2020).

Second, the improvement of transportation infrastructure is a significant driving force for urbanization. Convenient transportation expands the radiation range of cities, attracting more population and industries to cluster in urban areas, thus promoting the expansion of urban scale and the enhancement of urban functions. According to Julio Demartini, Peru’s Minister of Development and Social Inclusion, as of June 2024, the population of Chancay was 10,000 higher than in 2023 (Saenz 2024). Given the distribution of Peru’s ports, the country’s government has also stepped up the construction of industrial parks near relevant hubs. Since 2023, Peru has been building the Ancon Industrial Park between the Port of Callao and the then-under-construction Port of Chancay. It will promote the consolidation of the productive and logistics corridor Lima, Port of Callao, the Industrial Park and the Port of Chancay, and will generate an integrated ecosystem in which large and medium-sized companies and SMEs can develop synergies and new industrial relations (“The Ancon Industrial Park is to be developed on 715 hectares with an investment of US $760 million.” 2023).

Third, the state of transportation infrastructure is one of the important factors investors consider when choosing investment locations. A well-developed transportation network can provide favorable conditions for business operations, reduce operational costs, and improve economic efficiency, making it easier to attract both domestic and foreign investment, thereby injecting new vitality into regional economic development. In October 2024, Carlos Tejada, Deputy General Manager of COSCO Shipping Peru, announced that four global companies have expressed interest in investing in the country. These are companies engaged in high-value-added technologies, logistics, telecommunications, and raw material processing. They are not necessarily located in Chancay Park, but rather between Callao and Chancay, where there is the Ancon Industrial Park and the future Special Economic Zone of the new Jorge Chávez Airport (Rene 2024).

Such projects contribute to reconstructing the economic geography of Latin America, transforming peripheral areas from “resource suppliers” to “economic growth points”.

Technology Spillover and Transfer

According to the New Economic Geography Theory, informational spillovers can give clustered firms a better production function than isolated producers (Krugman 1991). In the era of transportation informatization, infrastructure not only involves the construction of transport routes and tools, but also incorporates advanced information technology, further facilitating the flow of knowledge. Although some projects have not reached the scale of industrial agglomeration, Chinese companies and universities, as external actors, have still generated technology spillover effects for local firms and institutions involved in engineering planning and construction in Latin America.

In recent years, China has continuously introduced advanced technology to Latin America through infrastructure cooperation. During the construction process, Chinese companies provide technical training for local engineering technicians and workers in Latin America, helping them master advanced construction techniques, equipment operation, and maintenance skills. Since 2024, the Bogotá Metro Line 1 has launched a nationwide youth talent training program in Colombia, aimed at providing professional training for recent graduates or technicians with less than two years of work experience. The plan includes sending 40 young people to China to research metro infrastructure development and take courses on metro operation management, maintenance support, and other related aspects at Xi’an Railway Vocational and Technical College. The general manager of Bogotá Metro, Narváez, stated that this program helps Colombian engineers improve their professional skills (Metro de Botogá 2024).

China also collaborates with universities and research institutions in Latin American countries to establish joint research institutions or laboratories, jointly conducting technology research and development in the transportation field. For example, the China–CELAC Railway Transportation Joint Laboratory was officially established in 2018, with Southwest Jiaotong University collaborating with the Federal University of Rio de Janeiro to promote the development and engineering research of high-temperature superconducting maglev train technology (“中国—拉共体轨道交通联合实验室揭牌 [The unveiling of the ‘China Latin America and Caribbean Community Rail Transit Joint Laboratory’].” 2018). Based on the Joint Laboratory, the two universities have jointly conducted research and development, advancing the technological progress and engineering research of high-temperature superconducting maglev trains, effectively promoting the development of their engineering prototype.

According to Director Wang Jiayu of the General Administration Department of the National Railway Administration of China, they will continue to consolidate and expand the achievements of China-Latin America railway cooperation under the Belt and Road Initiative, advancing such collaboration to greater depth and substance. Efforts will focus on key projects, including those in priority countries like Colombia, and initiatives such as the Bi-Oceanic Corridor. They are also promoting the establishment of communication mechanism for stakeholders in the railway sector (Zhou 2024).

Therefore, China not only directly transfers technology to Latin American countries through training programs, but also promotes further localization of transportation infrastructure technology in the region by conducting joint research.

Green Economic Development

In addition to the aforementioned impacts, with the continuous advancement of transportation infrastructure technology, we can observe its increasingly significant role in energy conservation, emission reduction, and helping enterprises mitigate environmental damage. According to the United Nations, the largest source of greenhouse gas emissions in Latin America and the Caribbean is the transportation sector, accounting for 39% of the region’s emissions (UNDP 2023).

Most Latin American countries are actively promoting the 2030 Sustainable Development Agenda by improving urban infrastructure, enhancing transportation conditions, and building low-carbon, environmentally friendly, and safe smart cities. Among these efforts, encouraging public transportation and promoting electrification of transport have become key policies. Increasing investment in transportation infrastructure helps Latin American countries improve public transit, reduce excessive carbon emissions, and mitigate air pollution caused by traffic congestion.

In recent years, there has been a growing number of projects, such as subways and trams, undertaken by Chinese enterprises in Latin America that contribute to reducing carbon emissions. For example, the Regiotram project in western Bogotá, Colombia, constructed by China Civil Engineering Construction Corporation, connects the capital with neighboring cities. With a total length of 39.6 kilometers and fully electric, it is expected to reduce carbon dioxide emissions by 165,000 tons over 22 years (“Así avanza Regiotram de Occidente, el sistema que revolucionará la movilidad del país.” 2023). The ongoing Bogotá Metro Line 1 will operate entirely on electricity, with an anticipated annual reduction of 171,000 tons of carbon dioxide emissions once operational (“La Línea 1 del Metro de Bogotá, símbolo de sostenibilidad ambiental.” 2024).

At the same time, most Chinese companies are increasingly emphasizing corporate social responsibility by conducting environmental assessments before project construction and implementing multiple measures to protect local ecosystems during and after construction, thereby minimizing the project’s environmental impact. For example, China COSCO Shipping Corporation Limited adhered to the concept of green development when constructing the Chancay Port in Peru. The project team focused on marine and wetland ecological protection, striving to integrate green development principles throughout the project phases.

They developed smart mobile piling platforms to avoid seawater pollution and reduce the use of non-engineering structural steel materials, introduced new vibration consolidation techniques to effectively control noise and dust pollution, reducing the construction timeline by nearly half, and promoted wastewater recycling to lower water consumption by over 25%.

Additionally, COSCO commissioned third-party authoritative agencies to monitor water quality, noise levels, and bird populations to keep track of ecological conditions in real time (“共建绿色智慧港口 共享繁荣发展之路 [Build a green and smart port together: share the path of prosperity and development].”, 2024). COSCO has also collaborated with local governments and environmental experts to form a specialized environmental protection team and established an animal rescue office to ensure ongoing marine and wetland ecological protection (Municipalidad Distrital de Chancay 2024). Furthermore, COSCO has built an energy twin control system at Chancay Port and developed the PortMeta3D global digital twin engine, which encompasses all physical 3D visualizations related to port operations, including port machinery, shoreline vessels, a 1.8-kilometer tunnel, and the Pan-American Highway. Through effective monitoring of energy consumption and the twin system, they aim to establish a systematic energy efficiency early warning system, creating a port early warning rules engine to monitor operational energy efficiency dynamics in real time (Shanghai Maritime University 2024).

Challenges Facing China–Latin America Transportation Infrastructure Cooperation

The lack of policy coherence within Latin America significantly impacts the advancement of relevant projects. Since the beginning of the 21st century, the phenomenon of government alternation has intensified in Latin American countries. Governments with differing ideologies often implement conflicting policies regarding public investment. For instance, the Milei administration halted the electrification project of the Belgrano Railway South Line, citing an economic crisis and fiscal difficulties, and announced the initiation of the privatization process for the Belgrano Railway Company (“Trenes: el Gobierno suspendió la electrificación del Belgrano Sur.”, 2025; “Milei firmó el decreto para que el tren Belgrano Cargas sea privatizado.” 2025).

Maximizing the economic benefits of infrastructure projects is a significant challenge. Infrastructure projects typically require substantial financial investment, long construction periods, and slow economic returns. This presents both opportunities and risks for financially strained developing countries. According to the Economic Commission for Latin America and the Caribbean, the ratio of public debt to GDP in 16 Latin American countries1 decreased from 55% in December 2023 to 52.6% in September 2024. However, debt issues remain prominent in several countries. For instance, Argentina’s public debt ratio fell from 156.6% to 110.5%, while Brazil’s rose from 74.4% to 78.3%. Panama, Costa Rica, and Ecuador also have debt ratios close to 60%. Given the limited capacity of many developing countries to expand government spending, there is a pressing need to seek innovative financing mechanisms and correctly identify infrastructure projects that can address development bottlenecks (Lin 2012, 91).

It is important to note that transportation and logistics efficiency is influenced by various factors. In addition to being closely related to the level of transportation infrastructure, logistics efficiency also considers customs clearance processes and the level of logistics digitization. The World Bank’s annual Logistics Performance Index (LPI) report mentions that some countries can enhance logistics efficiency by improving customs processes and strengthening digital infrastructure (World Bank 2023).

Some Chinese enterprises need to further strengthen their focus on environmental protection and safeguarding workers’ rights. Infrastructure construction presents a double-edged sword for the environment. The negative impacts include the land use required for the construction of roads, railways, and airports, which may lead to the destruction and reduction of natural habitats, disrupt the migration and breeding of wildlife, and affect the balance of ecosystems.

On the positive side, improvements in transportation infrastructure, such as urban rail transit, can encourage people to choose greener modes of travel, reducing the reliance on private vehicles and thereby lowering energy consumption and emissions. This has a favorable impact on alleviating air pollution and greenhouse gas emissions. Moreover, many countries leverage infrastructure construction to facilitate ecological protection, such as building ecological corridors that provide safe migration routes for wildlife, benefiting biodiversity conservation.

Minimizing environmental damage caused by infrastructure construction is a common challenge faced by governments and enterprises. In recent years, some infrastructure projects undertaken by China in Latin America (including hydropower stations, roads, and ports) have faced scrutiny from environmental organizations. For instance, the environmental organization Mundo Azul has raised concerns about the negative impact of Chancay Port on the surrounding wetland ecosystem. According to a study by this organization, the high noise caused by material extraction dumping and excavation activities drives away noise-sensitive species from the wetland. It also pointed out that the toxic dust emitted by the machinery will affect public health (Fernandez 2024). How to maximize ecological conservation while developing infrastructure is a critical challenge confronting both China and Latin American countries.

The United States remains highly vigilant regarding China’s influence in Latin America. After Trump took office in 2017, there was a significant shift in U.S. policy toward China, designating it as a strategic competitor and employing multiple measures to curb its influence. The U.S.–China strategic and economic dialogue mechanism was interrupted, halting discussions on China-Latin America relations. Following Trump’s return to the White House in 2024, he further intensified strategic competition with China and adopted a tougher stance on China–Latin America cooperation. U.S. Secretary of State Marco Rubio’s first visit was to Latin America, highlighting the current administration’s emphasis on the region. Under pressure from the U.S. government, Panama announced it would not renew its cooperation agreement with China under the Belt and Road Initiative (Moyano 2025). In the future, Latin American countries and China may face significant pressure from the U.S. in advancing infrastructure cooperation.

Conclusion

The analysis presented in the paper reveals that China–Latin America transportation infrastructure cooperation has yielded achievements. China’s infrastructure projects in Latin America create opportunities for economic development through multiple pathways of geopolitical economics. Through renovation, expansion, and new construction, the cooperation projects have improved the transportation efficiency of transportation infrastructure in Latin American countries and reduced logistics costs.

The extension of transportation infrastructure can drive industrial development in remote areas, increase local employment, and thereby improve the regional spatial economic structure. Chinese enterprises also attach importance to technology transfer to Latin American countries, including the construction of transportation rails, the operation management and maintenance of transportation infrastructure, etc., thereby promoting the local development in transportation technology. In addition, some transportation infrastructure projects are electrified, which helps reduce carbon dioxide emissions in Latin American countries. Chinese enterprises also integrate the concept of green development into the project construction process to reduce carbon emissions and damage to the ecological environment.

Looking ahead, deeper cooperation is necessary in areas such as green infrastructure and digital connectivity, aligning with Latin American countries’ development plans to elevate integration to a higher level. Specifically, cooperation should extend beyond traditional projects like railways, roads, ports, and airports to include urban rail transit, intelligent transportation systems, and logistics parks. This will enhance the overall quality and comprehensive service capacity of transportation infrastructure in Latin America.

Chinese enterprises should strengthen communication with Latin American governments and local communities, conduct environmental assessments in advance, and remain vigilant about the environmental impacts of projects throughout both construction and operational phases to minimize ecological effects. Attention should be paid to the potential impacts on local ecosystems, including the occupation of natural habitats, air pollution, noise pollution, disruption of ecological chains, damage to soil and vegetation, and interference with hydrological systems.

Additionally, digital technologies can be leveraged to improve the planning, design, construction, and operational efficiency of infrastructure projects. From the perspective of regional integration, China and relevant Latin American countries can accelerate strategic projects like the Twin Ocean Railway to enhance internal transportation links in Latin America, providing strong support for regional economic integration and trade development. There is also potential for more collaborative technological innovation in the transportation sector, focusing on smart transportation technologies and new energy transport equipment to elevate the technological content and intelligence of transportation infrastructure.

Latin American governments need to ensure policy stability and improve the investment environment. Particularly in the face of U.S.–China strategic competition, these countries should strengthen the autonomy of their diplomatic policies to minimize the impact of international fluctuations on national development plans. Identifying which infrastructure projects can significantly stimulate economic growth and overcome development bottlenecks is essential. This requires project coordination across various government levels, as some projects are financed and implemented locally. Additionally, priority should be given to infrastructure projects that can generate revenue through user fees, such as bridges and highways.

Many Latin American countries possess rich natural resources, yet their economic potential remains under-explored. Transportation infrastructure development plays a crucial role in promoting domestic and international connectivity and enhancing regional integration. Latin American countries should seize infrastructure opportunities to drive structural economic transformation, strengthen cooperation with China and other nations, and achieve inclusive and sustainable growth both nationally and regionally.

Acknowledgements

The research is part of the project funded by the Social Science Research Base of the Chinese Ministry of Education, entitled ‘Study on the Change of US Diplomacy and the Competition between the US and China at the Global Level’ (No.22JJD810004).

References

  • 1
    The 16 Latin American countries included in the statistics are Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, the Dominican Republic, and Uruguay.
  • Data Availability Statement:
    Data supporting this study are openly available from Harvard Dataverse at https://doi.org/10.7910/DVN/FL4F5J.

Data availability

Data supporting this study are openly available from Harvard Dataverse at https://doi.org/10.7910/DVN/FL4F5J.

Publication Dates

  • Publication in this collection
    24 Oct 2025
  • Date of issue
    Sept 2025

History

  • Received
    19 Mar 2025
  • Accepted
    19 Aug 2025
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