US imposes travel bans, port actions in push to counter China's reach in Latin America

The Trump administration imposed travel restrictions on three Chilean officials over a proposed fiber optic submarine cable project with Chinese involvement and warned Peru against ceding control of a Chinese-built deepwater port, escalating a broad push to reduce Beijing’s economic and strategic footprint across Latin America. Panama, under pressure from President Trump, seized two canal-adjacent ports that had been operated by a Hong Kong company. The moves came days before Trump planned to host Latin American leaders at his golf complex near Miami for a summit the administration called the “Shield of the Americas.”

China has become the dominant trading partner for most of South America and the largest official financier of the region’s infrastructure over two decades, giving Beijing an entrenched economic position that analysts say the administration’s pressure campaign will struggle to displace in the near term.

Recent US actions

Washington did not publicly identify the three Chilean officials subject to the travel bans, which targeted their involvement in a proposed undersea fiber optic cable project with a Chinese company. The Peruvian port warning centered on Chancay, a facility on Peru’s Pacific coast that the Associated Press reported is one of the deepest in Latin America and was constructed by China. U.S. officials have expressed concern that Beijing could use the port for military purposes.

Panama’s seizure of two ports — one at each end of the Panama Canal — followed months of pressure from Trump, who had threatened to reclaim U.S. control of the waterway. The ports had been operated by a company based in Hong Kong.

The capture of then-Venezuelan President Nicolás Maduro by U.S. forces in January also reverberated across the region’s economic landscape, according to the AP. China had significant oil interests in Venezuela, and Maduro’s removal placed those investments in an uncertain position overnight.

The economics behind China’s footprint

China’s influence in Latin America grew steadily through lending, trade, and investment in sectors where U.S. capital was absent. In 2001, Cuba was the only country in the region that did more business with China than with the United States, said Francisco Urdinez, an associate professor at the Institute of Political Science at the Pontificia Universidad Católica de Chile, who tracked the movement of Chinese companies and capital in his book Economic Displacement: China and the End of US Primacy in Latin America. Twenty years later, every South American country except Paraguay and Colombia traded more with China than with the United States, Urdinez said.

Between 2014 and 2023, China provided approximately $153 billion in loans and grants to Latin America and the Caribbean — the largest source of official-sector financing for the region — compared with roughly $50.7 billion from the United States during the same period, according to AidData, a research lab at William & Mary.

Rebecca Ray, an academic researcher at the Global Development Policy Center at Boston University, said China had moved into sectors where the United States had not invested. “The United States did not invest in the industries the developing world looks to to reduce their infrastructure gaps,” Ray said. “The U.S. is not investing in green energy; the U.S. is not investing in green mobility. Meanwhile, over the last 20 years, China has made a technological leap into these new industries, and Chinese companies have had to develop technologies no one else has to make those industries viable.” (Quotes translated from Spanish.)

Security concerns and Taiwan

Washington’s concerns extend to security. China sells arms and law enforcement and military equipment to Latin American countries and assists in training police and military personnel, according to the AP. U.S. officials have also raised the Chancay port as a potential dual-use facility.

The Taiwan question runs through much of the U.S.-China competition in the region. Of the 12 countries worldwide that still recognize Taiwan’s statehood, seven are in Latin America. Since 2016, five countries in the region — Panama, the Dominican Republic, El Salvador, Nicaragua, and Honduras — broke ties with Taiwan and opened embassies in Beijing, seeking economic benefits from China.

Beijing considers Taiwan part of its territory and has pledged to annex the island by force if necessary. The United States is legally obligated to provide Taiwan sufficient equipment to deter a military attack.

Rep. John Moolenaar, a Michigan Republican who chairs the House Select Committee on the Chinese Communist Party, expressed support for the administration’s approach. “President Trump is right to focus on defending the Western Hemisphere from China,” Moolenaar said. “President Trump has made clear that we stand with our friends in the region against China’s efforts to undermine U.S. interests.”

The White House’s National Security Strategy, released in December, attributed the erosion of U.S. primacy in the Western Hemisphere to “years of neglect” and committed to denying non-hemispheric competitors the ability to “position forces or other threatening capabilities, or possess or control strategically vital assets, in our hemisphere.”

Analysts see a more fragmented region ahead

Several analysts expressed skepticism about whether the administration’s approach would succeed in detaching Latin American governments from China, warning it could deepen regional divisions instead.

“Trump’s approach makes the strategy of keeping options open increasingly difficult,” Urdinez said. “The most likely outcome is a more fragmented region. Right-wing governments will align more closely with Washington, while left-wing governments will maintain or deepen their ties with China. Countries caught in the middle will try to manage the tension case by case.” (Translated from Spanish.)

Enrique Millán Mejía, a researcher on economic development at the Adrienne Arsht Latin America Center at the Atlantic Council, said many Latin American governments view China’s investment record with some frustration and are interested in stronger U.S. engagement. “There is some discontent with China’s presence as an investor and with how the footprint and outcome of those investments have not been significantly positive for the economy,” Millán Mejía said, adding that governments are seeking a promise that Washington will invest in strategic sectors. (Translated from Spanish.)

But Millán Mejía said China’s existing presence in infrastructure, security, logistics, and technology gives it a durable advantage. He expected most governments to pursue a pragmatic course rather than choosing sides outright. “For Latin America it is very important to have a very good and close relationship with the United States,” he said. “But obviously, from an economic point of view, it is good to maintain at least trade relations with China.” (Translated from Spanish.)

China’s position

Sun Yun, director of the China program at the Stimson Center in Washington, said Beijing views its presence in Latin America as commercially driven rather than as a competition for regional dominance with the United States. “From China’s perspective, there is no competition for dominance with the United States,” Sun said. “They will prioritize protecting their assets and will not give up without a fight facilities like a port.”

Sun added that Beijing regards the Taiwan question as central to any broader accommodation with Washington: Chinese officials argue that if the United States expects China to respect U.S. definitions of its sphere of influence, Washington must in turn respect China’s position that Taiwan is a core national interest. (Paraphrased from translated source material.)