The Trump administration's approach to China's growing Latin American footprint -- seen as a national security and economic threat -- has so far been more stick than carrot.

Trump has repeatedly threatened to "take back" the US-built Panama Canal if Panama doesn't reduce Chinese influence in the strategic waterway, which handles 40 percent of US container traffic.

China is also an indirect target of tariffs Trump has announced on steel and aluminum from allied countries such as Mexico.

The White House says Chinese producers are abusing the USMCA North America free-trade treaty to "funnel" aluminum into the United States through Mexico, tariff-free.

China has condemned a "Cold War mentality," accusing the United States of using "pressure and coercion to smear and undermine" its Latin American investments.

"There's no doubt that the Trump administration sees China's footprint in the Americas as a relevant threat to its national security and foreign policy interests," Arturo Sarukhan, who was Mexico's ambassador to Washington from 2006 to 2013, told AFP.

"That's what basically explains President Trump's diplomatic bullying of Panama, his America First Trade Policy... and his threats to upend USMCA," he said.

- Entering US via backdoor -

The United States for two centuries claimed Latin America as part of its sphere of influence. But China has been making inroads.

Two-thirds of Latin American countries have joined Chinese President Xi Jinping's trillion-dollar Belt and Road Initiative infrastructure program and China has surpassed the United States as the biggest trading partner of Brazil, Peru, Chile and several other countries.

In November, Beijing's ambitions were on full display when Xi inaugurated a $3.5 billion, Chinese-funded megaport in Peru that will allow China to skirt North America in trading with South America.

The Trump administration's immediate concerns appear to be with Chinese influence closer to home, particularly in Panama and top US trading partner Mexico.

Chinese investment in Mexico has soared since Trump's first presidency when companies in sectors targeted by US tariffs moved part of their supply chains to Mexico.

In a nod to Washington's complaints that it had a free trade deal "with Mexico, not China," President Claudia Sheinbaum announced plans to cut Chinese imports by boosting local production of cars, textiles and other goods.

China is also deeply embedded in Panama's economy, beyond the two ports operated by a Hong Kong company on the canal, which have raised hackles in Washington.

Jason Marczak, senior director of the Latin America Center at the Atlantic Council think tank in Washington, described parts of Panama as being "inundated with Chinese displacing Panamanian local entrepreneurs."

There too, Washington's pressure tactics appeared to pay off, with Panama pulling out of China's Belt and Road program days after a visit by US Secretary of State Marco Rubio.

- 'Into Beijing's arms' -

Experts predict the rivalry to be tough in South America, where China has invested heavily in critical minerals including copper and lithium.

Before coming to power in 2023, Argentina's libertarian President Javier Milei, who wants a free trade agreement with the United States, vowed he would not "make deals with communists" in China.

A year later, he was praising the world's second-biggest economy as an "interesting" trade partner that asks for nothing in return.

Brazil, for its part, maintains strong ties with Washington as well as Beijing -- a fellow member of the expanding BRICS alliance of non-Western powers.

Sarukhan, the former ambassador, says Trump's threats and trolling of South American countries "could push them further into the arms of Beijing."

Colombia's leftist President Gustavo Petro, for example, announced plans to strengthen ties with China after being threatened with sanctions and trade tariffs for initially turning away US migrant deportation flights.

But his attempts to rally a Latin American coalition opposed to Trump's plans fizzled.

"No country wants to be in the middle of an 'us versus them' global geostrategic battle. But when given the option, there's a great alignment of US and Western values," said Marczak. "And so the US investment is preferred."