South America explores building own 2,800-mile transcontinental railroad

Brazil and China have signed an agreement to launch a technical, environmental and economic feasibility study for a proposed 2,800-mile railway linking Brazil’s Atlantic coast with Peru’s Pacific port of Chancay.

The memorandum of understanding, made public on Monday, was agreed between Infra S.A., a Brazilian state-owned entity attached to the Ministry of Transport, and the China Railway Economic and Planning Research Institute.

Why It Matters

The proposed transcontinental corridor, if constructed, would represent a multibillion-dollar logistical overhaul for cross-continental trade, with estimates suggesting the cost could rise above $70 billion. Linking Brazil’s Atlantic coast with the Pacific Ocean in Peru could shorten shipping times to Asian markets by as much as 12 days compared with current routes passing through the Panama Canal.

This diversification of trade infrastructure could decrease dependence on maritime choke points and foster expanded economic ties between South America and Asia. Infrastructure improvements on such a scale could make South American exports more competitive in Asian markets and potentially realign global supply chains.

What To Know

The feasibility study follows months of growing engagement between Brazil and China. In April, a Chinese delegation visited Brazil’s Fico and Fiol railway lines, which are anticipated as important components for the larger corridor. The same group toured the Port of Santos, the busiest port in Latin America, which is also being expanded with Chinese investment.

The planned 2,800 miles of rail line would stretch from Ilhéus, Bahia, in northeastern Brazil, through the Amazon and the state of Acre, and ultimately cross the Andes Mountains into Peru.

The final destination would be Chancay, a major Pacific port. The project’s cost, estimated at over $70 billion, makes it one of the most expensive infrastructure projects in South American history. As of the agreement, both countries have limited their commitment to a feasibility study, which will examine technical, environmental and economic implications. The study is projected to take up to five years before any construction could begin.

The feasibility study will need to account for significant logistical, technical and environmental hurdles. The planned railway traverses ecologically sensitive regions including portions of the Amazon rainforest and the Andes Mountains, raising concerns about potential impacts.

Both parties remain in the study phase and have not made final commitments on route selection or environmental mitigation.

The memorandum was signed after months of negotiation and on-site assessments, including a review of Fico and Fiol.

In addition, Chinese firms have ongoing investments in the expansion of major Brazilian ports, notably the Port of Santos. The scope of future South American regional participation—particularly from Peru and other neighboring countries—remains part of the study process.

What People Are Saying

Vicente Abate, president of Brazilian rail equipment manufacturers’ association Abifer, told BNamericas: “This initiative is very positive because it helps reduce logistics times and costs, since the connection to Asia through the Pacific Ocean is faster than through the Atlantic Ocean.

“But carrying out a railway project of this magnitude has implementation challenges, ranging from financing issues to project execution and permitting.”

What Happens Next

The feasibility study process is scheduled to take up to five years, during which technical teams will assess the environmental, engineering and financial viability of the rail corridor.