The governors of three Brazilian states signed this week a memorandum of understanding for the construction of a China-backed transcontinental railway, online news portal Macauhub reported.

The Brazilian parties to the agreement are the states of Mato Grosso, Acre and Rondónia. The ceremony was also attended by Li Jinzhang, China’s Ambassador to Brazil, and 23 Chinese entrepreneurs that were visiting the South American nation for talks on the railway project.

The proposed transcontinental railway, connecting Brazil to the neighbouring nation of Peru, would pass through six Brazilian states, Macauhub reported.

During a visit to Brazil and Peru by China’s Premier, Li Keqiang, in May last year, the three nations agreed to start a feasibility study on the building of such a transport link.

Media in Brazil have reported that the proposed 5,300-kilometre railway might cost US$10 billion and take six years to complete.