Recently, Chile's Beler company signed an agreement with Singapore's International Nusantara Investment to invest nearly $9.6 billion in the construction of a cross-border railway connecting Argentina and Chile. The core of the project is a railway tunnel of approximately 54 kilometers that runs through the Andes Mountains, connecting Uspajata, Argentina with Los Andes, Chile, allowing trains to travel steadily throughout the year and completely eliminating the constraints of harsh winter weather on the existing Cristobal International Corridor.

Rebuilding the Logistics Backbone of South America

In addition to the mountain crossing tunnel, the project also plans to construct approximately 420 kilometers of double track electrified railway, and build a multimodal logistics center and supporting facilities for the La Liga deepwater port in the Longotama area of Chile, forming an integrated transportation system of railway, logistics hub, and port.

This line is seen as a comprehensive upgrade to the cross Andean railway that was closed over 40 years ago. The old railway had a gauge of only 1000 millimeters and was discontinued in the 1980s due to high operating costs and aging facilities. On the basis of inheriting its cross mountain corridor heritage, the new project is shifting towards a modern logistics system centered on international freight and regional integration, with the goal of building Chile into a key export gateway for South American agricultural and mineral products to the Pacific.

80% of agricultural products flow to the Asia Pacific region

The underlying logic behind the project lies in the high dependence of South American agricultural products on the Asia Pacific market. It is estimated that Argentina and Brazil export over 380 million tons of agricultural products such as soybeans, corn, and wheat annually, with nearly 80% of them flowing to China and the Asia Pacific region. Keywords: Cross border railway, logistics

For a long time, the export of South American agricultural products has been constrained by bottlenecks such as a single logistics channel and high transportation costs. Once completed, the Trans Andean Railway will provide an efficient channel for agricultural products and raw materials from countries such as Brazil, Argentina, Paraguay, and Uruguay to reach the Pacific Ocean, significantly reducing transportation time and costs. Chile is expected to upgrade from a regional transit country to a logistics hub facing the Asia Pacific region in South America, while China, as the largest buyer, will be the biggest beneficiary of this new channel.Editor/Cheng Liting