Peru is embarking on a major, multi-billion dollar modernization of its naval capabilities through a strategic 22-year partnership with South Korea’s Hyundai Heavy Industries. the enterprising initiative, backed by approximately $831.9 million USD in investment through 2026, aims to bolster Peru’s regional security presence and foster a domestic shipbuilding industry capable of advanced submarine and warship construction. This extensive overhaul extends beyond military applications, with projects also supporting commercial port development and the nation’s vital fishing sector.
Peru is embarking on a major overhaul of its naval capabilities, fueled by a strategic alliance with South Korea and significant government investment. The initiative aims to position Peru as a regional leader in the construction of advanced submarines and warships.
A key component of this modernization effort is a partnership with Hyundai Heavy Industries, which will include technology transfer to Peruvian shipyards. The collaboration is expected to significantly enhance Peru’s military capacity by 2030.
Retired Rear Admiral César Benavides, former general manager of Servicios Industriales de la Marina (SIMA), emphasized the importance of international cooperation in the project.
“The selection of the co-producing shipyard for the projects commissioned by the Navy to SIMA went through a selection process. It wasn’t a selection where other important shipyards weren’t evaluated. On the contrary, it was designed that way,” Benavides explained.
According to Benavides, the decision to partner with Hyundai Heavy Industries wasn’t solely based on cost and timelines. “There was a need to determine the level of knowledge transfer and what contribution would be made to the development of a national industry that, throughout the construction processes, would allow us to have a local industry capable of providing a base for these processes,” he said.
Long-Term Cooperation
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A framework agreement with the South Korean company establishes a 22-year cooperation period, during which key units for the Peruvian Navy are projected to be built and modernized.
Official figures indicate that the Peruvian naval sector has received approximately 2.8 billion soles (US$831.9 million) in investment, allocated to four major projects continuing through 2026. Between 30% and 35% of this funding will remain within the country through contracts with local metalworking companies, equipment suppliers, and technicians, bolstering the national production chain.
Currently, the most advanced project involves two logistical support ships, which are already 50% complete and slated for delivery by the end of next year. The launching of these vessels, following hull completion, is scheduled for May or June 2026, according to SIMA General Manager Luis Silva López. “The challenge is to deliver these two logistical support ships by the end of next year,” Silva affirmed.
The renewal plan extends beyond support vessels. It includes the modernization of the Navy’s second submarine, as well as the construction of a river tourist vessel in Iquitos for the private sector, also expected in the second half of 2026.
The development of a multirole frigate represents the most significant technological challenge for the Peruvian naval industry in the last decade. “That will take time. We should be delivering it by the end of 2029. That’s the big technological challenge we have,” Silva stated.
Cutting-Edge Equipment
Benavides noted that the agreement with Hyundai Heavy Industries opens the door to the construction of modern submarines equipped with advanced electronics and state-of-the-art technology.
“The Navy is seeking to have the best in the world within the available budgets. First-rate equipment is being integrated globally,” the rear admiral emphasized.
The cooperation includes a technology transfer process that, according to the former head of SIMA, “has gone beyond what was even written,” allowing Peruvian technicians access to knowledge and methodologies previously unavailable to the local industry.
Strategic Asset
Peru’s tradition of submarine operations is a crucial element of this strategy. “The submarine is a strategic weapon. The Navy intends to maintain these capabilities over the years because it does give us an advantage,” Benavides said.
He pointed out that Peruvian submarines regularly participate in exercises with the U.S. naval fleet, reflecting the country’s position in the region. “We can have the best submarine in the world, but if the crew doesn’t know how to operate it, we’re talking about something else entirely,” he remarked.
The Navy’s strategic plan for modernizing its units includes integrating missile systems, radars, and next-generation sensors, along with operator training and the development of local maintenance capabilities.
The goal, according to Benavides, is to provide the country with an industrial base that can sustain the lifespan of ships and submarines for decades, without relying entirely on foreign assistance. “We want the national industry to participate in this process by having the capabilities to provide maintenance,” he added.
Port Development
The impact of this process extends beyond defense to include port and commercial development, as sources consulted by BioBioChile have indicated.
The strategic location of Callao and the growing demand for maritime traffic require infrastructure capable of handling the world’s largest ships. The only dry dock available in the port dates back to 1938 and cannot accommodate large vessels, so the construction of new facilities is planned to consolidate Callao as a regional logistics hub.
The fleet renewal isn’t solely driven by military needs. The national industry is currently building a Scientific Fisheries Research Vessel for Imarpe, to improve the assessment of hydrobiological resources and the sustainability of the fishing sector.
Additionally, the incorporation of an oceanic patrol vessel is planned, with construction expected to take between two and a half to three years.
SIMA’s vision links the naval industry to the renewal of the fishing fleet and the potential to export vessels and specialized maintenance services, given the growing demand in the region for maritime and river patrol boats.
Benavides emphasized the role of the naval industry as a cornerstone of national development. “SIMA is the best shipyard in this region,” he stated, adding that the objective is to develop a local industrial network capable of supporting not only the Navy but also all activities related to the sea and the Amazon, where communication is primarily via rivers.
The strategic plan includes the integration of private companies and the development of technological capabilities for the maintenance and repair of vessels, which would give Peru greater technological independence and a privileged position on the continent.
“SIMA has bet on this concept of developing its industry to provide support,” Benavides said. He added that the national maritime policy, established in 2019, includes security as one of its components and aims at the sustainable exploitation of maritime and fluvial resources.
Benavides concluded by highlighting the achievements of the Peruvian Navy in international forums and exercises, such as the participation of the replenishment ship BAP Tacna with the U.S. fleet. “We are in the most important league in the world participating. And if we are, it’s for a reason,” the former head of SIMA concluded.
