After traveling half the world, a post-85s woman decides to start a business in Peru | Undercurrents of the World
Author | Ren Qian
Editor | Liu Jing
Peru, the "neighbor" 17,000 kilometers away from Beijing, China and on the other side of the Pacific Ocean, has drawn a great deal of attention.
Firstly, the Chinese President paid a visit, and then during the Asia-Pacific Economic Cooperation (APEC) meeting, the two countries issued a joint statement to deepen the comprehensive strategic partnership.
What is closely related to venture capital is that the two sides will include emerging field projects such as circular economy, sustainable agriculture, industrial chain and supply chain, and digital economy investment in bilateral cooperation. At the same time, they will promote exponential technology cooperation in artificial intelligence, robotics, the Internet of Things, blockchain, data analysis, nanotechnology, and telemedicine.
The President of Peru stated at the opening ceremony that Peru "opens its doors to capital and investment funds from all over the world" and emphasized Peru's legal and economic stability as well as "clear rules of the game".
Today, Peru has become the second largest investment destination for China in Latin America (second only to Brazil).
Especially in the fields of infrastructure, energy and mining. For example, the company Peru Boruz Energy, which is responsible for providing power guarantee for the APEC Summit, including the Presidential Palace, the Lima Municipal Government, and the airport, is actually affiliated with China Southern Power Grid. Just a few months ago, China Southern Power Grid just completed the acquisition of the former. Another example is Peru's largest power company, Luz del Sur, which is operated by Yangtze Power, a subsidiary of China Three Gorges Group, after its acquisition in 2020.
The most notable is the Chancay Port in the north of Lima, which was jointly built by China and Peru with an investment of 3.6 billion US dollars. The locals affectionately call it the "Shanghai" of Peru. The first phase of the Chancay Port project can shorten the shipping time from Peru to China to 23 days, save more than 20% of logistics costs, bring 4.5 billion US dollars of income to Peru every year, and create more than 8,000 direct jobs.
Although the physical distance is far, the two countries have had exchanges for more than four centuries. As early as the beginning of the 17th century, Chinese people arrived in Lima via the Manila Galleon Trade through Mexico, becoming the first batch of Chinese immigrants. In 1849, Peru passed the immigration law to introduce Chinese workers. On October 15 of the same year, the first batch of 75 "contract Chinese workers" set sail from Macau, took a Danish merchant ship, and arrived at the Callao Port in Peru after a 120-day voyage. Up to now, Peru has become the Latin American country with the largest Chinese community and the highest participation rate of Chinese and ethnic Chinese.
Now, for Chinese entrepreneurs attempting to go global, what opportunities does Peru offer?
"Dark Waves" interviewed Duan Qi, a serial entrepreneur who went to Latin America. She is a rare woman with a background of studying and working in China, Europe, and several Latin American countries such as Ecuador, Mexico, and Peru. She stepped out of the traditional Chinese industry, went through several twists and turns in the global going-out wave, and finally chose to set up a factory in Peru. She has a good understanding of international engineering, manufacturing, cultural industry and fintech in Latin America.
We may not be able to find the answer from a single story. But the changes of the times, the direction of the tide, and personal choices are hidden in every step of her career change, which may bring some inspiration.
"Dark Waves Looking at the World" is a new column of Dark Waves. Over the past three years, we have successively launched a series of globalized content, and now we are launching a series of reports more systematically. Latin America is still the focus of our research at this stage.
The following is Duan Qi's self-report, edited by "Dark Waves":
Multicities in the Spanish-Speaking World
I majored in Spanish. When I was a junior, I was an exchange student in Spain for one year. Right after graduation, as an employee of China Railway Group, I was dispatched to an engineering project in Ecuador. At that time, China Railway Group went global following the country's going-out strategy, mainly undertaking large-scale infrastructure projects such as building railways, roads, and bridges in Latin American countries.
In three years, I went from an internal job-rotation translator to the founder and manager of the human resources department. I solved the most troublesome project union problem for Chinese-funded enterprises, studied the laws of Ecuador, wrote articles analyzing the union problems in Latin America, and handled project disputes at all levels. This experience allowed me to learn "how to work with and achieve results with Latin Americans" from various dimensions.
After experiencing the complete chain of operating the project and accumulating business expansion experience, I returned to Beijing. Then I moved to Mexico and worked for a privately-owned enterprise engaged in commercial real estate development in Mexico City, where I established the foreign affairs department of the company from scratch.
At that time in Mexico (2015 - 2018), not many Chinese enterprises flocked in. Most of them were in traditional industries such as China Railway Group, PowerChina, CHEC, and CNOOC; communication technology companies included Huawei and ZTE, as well as some banking and financial institutions.
There were almost no Chinese enterprises participating in large-scale infrastructure projects in Mexico. The bids were often won by European countries such as Spain, France, and Germany, or American, Brazilian, and local Mexican enterprises. However, in just two short years from 2020 to 2021, "Infrastructure Maniac" China successively won several landmark projects in Mexico, such as the Maya Railway and the Mexico City Metro Line 1 project.
In those years, during the negotiation period of the "United States-Mexico-Canada Agreement", I gradually felt the changes and hopes this agreement brought to this country in Mexico. Mexican economic and political figures also did not hide their admiration for China's rapid economic growth during the same period. They are planning a national development path with "Mexican characteristics" and weaving the "Mexican Dream" for the people. I also gradually sensed that the future of global change will be in Latin America.
After leaving Mexico, I joined a foreign consulting company in Shanghai, mainly responsible for the business in Spanish-speaking countries around the world.
The business logic of the consulting company is different from the entity industry that I have experienced for eight years. It needs to deal with people from different industries and different countries. Although this experience was only for one year, it helped me unlock the cognition and understanding of the vast majority of Spanish-speaking countries in the world, as well as being able to observe the economic, political development and changes in Spain and Latin American countries horizontally.
So now, I am back in Latin America, witnessing the increasingly surging wave of Chinese manufacturing and Internet going global, and planning to realize my dream.
In the manufacturing field, the factory project I participated in in Peru has officially started the procedures for starting various operations; in the fintech field, with the improvement of local payment and consumption capabilities, I am collaborating with local governments in major Latin American countries to prepare and implement related projects.
The Real Peru
When going to Latin America, many people will ask me which country to choose?
I believe that any going-out strategy that is divorced from the industry itself and the development needs of the enterprise is single and one-sided. The going-out strategy not only depends on the political and economic factors of the target country, such as the ruling party, the national exchange rate, the inflation rate, the currency stability, and various taxes, but also needs to be comprehensively considered according to the industry field and core needs of the enterprise.
But it is certain that from the visit of the President of Peru to China in June this year to this APEC Summit, the strategic partnership between China and Peru is progressing layer by layer.
The "Protocol on Upgrading the Free Trade Agreement between the Government of the People's Republic of China and the Government of the Republic of Peru" signed between the Chinese and Peruvian governments will vigorously promote the trade between China and Peru, in addition to the traditional agricultural products and minerals, to increase the trade export of high-value fishery products in Peru, integrate global supply chains, e-commerce and other fields, and create a better business environment for enterprises of the two countries.
And the "Joint Statement on Deepening the Comprehensive Strategic Partnership" jointly issued by the two countries recently also clearly puts forward the specific direction of future cooperation.
In particular, the jointly built landmark project - the opening and operation of the Peru Chancay Port, this port will make Peru a gateway for South American trade to the Asian market, directly changing the global shipping history. In Peru, "De Chancay a Shanghái (From Chancay to Shanghai)" has become a popular phrase.
Visiting the Peru Chancay Port under construction in August this year © Duan Qi
In recent years, there has been a strong signal for the manufacturing industry in China to go global. I have been studying the feasibility of spillover to Latin American countries. Peru is one of the "blue ocean" countries I have discovered.
Although the overall technical level of Peru's industrial manufacturing is still in the 2.0 era at this stage, mainly concentrated in agricultural and sideline products, clothing and accessories, food, building materials processing, and mining product processing, in recent years, the Peruvian government has introduced a series of tax incentive measures to attract the development of its own industrial manufacturing, including refunding customs duties on exported goods, and special customs and tax systems in special economic zones.
At present, there are very few factories invested and operated by Chinese capital in Peru, and there is a huge space for capital to enter to accelerate industrial upgrading and transformation and enrich industry categories. It is expected that in the next two years, Peru will rank second in industrial production in Latin America, second only to Mexico.
When going to a strange country far away from home, the first thing to investigate is definitely the market space and stability. According to my own observation, Peru is one of the few Latin American countries where the economy does not fluctuate sharply due to changes in political power. It is completely determined by the market. The housing prices in the capital Lima have hardly changed in the past ten years. Peru's inflation rate has remained at around 2% for many years, and the US dollar exchange rate has basically remained at around 1:3.7.
The efficiency and seriousness of the Peruvian government have also exceeded my expectations. Take the project that I have already landed as an example. When communicating with the Peruvian government in the early stage, both the branch in Beijing and the headquarters in Lima were very proactive. In the three months before our official visit to Peru, we held nearly 10 video conferences and issued more than ten latest reports related to the project.
There is a 13-hour time difference between Peru and China. They often come to the office at 7 am Peruvian time to have a meeting with us. Later, for the field visit, the specific itinerary was arranged by the Peruvian government, and two officials were sent to accompany us throughout the process. Sometimes after we finished a meeting and felt it necessary to insert other related meetings temporarily, they would immediately send an official note to the relevant parties to coordinate the time, place and participants.
When communicating with local potential partners, we once received a service quote that was 10 times higher than the market price. At that time, a Peruvian government official said to me: "This company is 'cheating' you. Don't believe it. You need to contact more companies of the same type and make a cautious decision. Some Peruvian companies will take advantage of you when they see that you are foreigners. Before you come to invest, you must conduct a sufficient market survey, and we will fully cooperate. You need to understand the real Peru."
You can feel the pragmatism and sincerity from various details. This may be related to the status of Chinese and ethnic Chinese in Peru.
Peru is the Latin American country with the highest participation rate of Chinese and ethnic Chinese. In the political field, ethnic Chinese have served as senior positions such as the Speaker of the Congress, the Prime Minister, and government ministers, and there are many who serve as members of the Congress and local administrative chiefs; in the business field, Chinese and ethnic Chinese have been operating in retail, catering, construction and other industries for many years, and some chain retail enterprises have become industry leaders.
The ethnic Chinese born in Peru are called "tusan" (from the Cantonese "土生"), and they generally identify with their own identity. Many ethnic Chinese can clearly state which ancestor was a Chinese immigrant. The Chinese ancestry accounts for one-tenth of Peru's population, which is a considerable number, so Peruvians are naturally friendly to the Chinese.
The food capital Lima hides more than 4,000 Chinese restaurants "Chifa" - which is a homophonic of "吃饭", derived from the affectionate call "Let's eat" of those Chinese laborers back then. And the General Association of Chinese in Peru in the bustling area of downtown Lima has a history of nearly 140 years, witnessing the friendship between China and Peru.
China and Peru are indeed in a "honeymoon period". According to statistics from the China Chamber of Commerce in Peru, the total investment of China in Peru is at least 35 billion US dollars, involving industries such as mining, infrastructure, energy, communications and services.
The large-scale investment activities of Chinese enterprises in Peru can be traced back to 1992 - China Shougang Group bought 98.4% of the shares of the Peruvian state-owned iron ore company that was on the verge of bankruptcy for 118 million US dollars, including the permanent exploration, mining and management rights of the 670.7 square kilometer mining area.
If You Can't Beat Them, Join Them
When I first arrived in Latin America more than ten years ago, I thought it was similar to Africa. Later, I found that the objective conditions were much better than I imagined. After all, it was ruled by Spain for more than 300 years, and its economy, judicial system, traditional customs, and national cognition are deeply influenced by European culture.
But this history also makes Latin Americans have a love-hate relationship with Spain. Therefore, they commemorate the victory of the War of Independence in various forms. Simón Bolívar and San Martín, who symbolize the liberators of the Americas, have squares named after them in Latin American countries. They represent the national spirit of Latin America.
Ecuador is the first Latin American country I went to. It is located in the equatorial region. Although this country is not large in size, it has a complete topography and rich resources. The capital, Quito, is located on the Andes Mountains.
It can be said that half of my temperament was worn out by the Ecuadorians. For example, when we make an appointment with the locals, they will always reply "mañana (tomorrow)", but when you ask them again tomorrow, they will continue to reply "mañana". If it is still "mañana" on Wednesday, it is basically unlikely to happen this week, and they will disappear on the weekend.
Because they attach great importance to the family atmosphere, they will definitely spend the weekend with their families, and all work information is automatically blocked. They will not reply to text messages, phone calls, or emails. For Chinese people who emphasize efficiency and accuracy, it is particularly difficult to adapt to such a work rhythm, and it is also very helpless.
Later, we became smarter. If we want to have a meeting next week, we start making an appointment from this Monday, confirm it every other day until it is finally settled. And on the day of the meeting, we still need to remind the other party that even if it is on time, being late is also a basic operation.
Once I went to the national tax department to handle affairs. If we didn't pay a certain fee, we would be fined immediately. But when the government department had the "mañana" attitude, I was anxious at the scene. As a result, the staff looked at me puzzled and asked, "Why are you angry? Please calm down. I told you to come back tomorrow, so you can only wait until tomorrow." But we all know that this "tomorrow" does not know when it will be postponed. In the end, we could only obediently pay the fine.
But in contrast, the Latin Americans have a very serious and even rigid execution ability, especially Mexicans and Peruvians.
For example, the gardener we hired in Mexico is particularly responsible for pruning trees and pays great attention to details; when we are doing a project, although we can use more cost-effective materials and complete it more time-saving and labor-saving, the owner and the supervisor do not agree, just because the "standard" of this material is not from their own country, and they are willing to spend more money for the "standard".
When I was in Peru, I found that the diligence of Peruvians is even more than that of the Chinese. I would receive information and emails from lawyers and government officials in the early morning, completely subverting my impression of Latin Americans known for their relaxation. At the same time, Latin Americans are very