By Liz Lee, Joe Cash and Eduardo Baptista

BEIJING (Reuters) -China offered fresh credit lines and visa-free travel to Latin America on Tuesday in its latest move to encourage greater engagement with the region, although Brazil said its neighbours must not rely too heavily on foreign economic powers.

China will commit credit lines of just under $10 billion to Latin American countries to support development, but in yuan, President Xi Jinping said in a speech to kick off the China-CELAC Forum ministerial meeting that gathered Latin American and Caribbean officials in Beijing.

The credit line, denominated in yuan, appears to be a push to further internationalise the Chinese currency, as China doubles down on deepening strategic and economic ties with Latin America.

During the inaugural China-CELAC Forum in 2015, Beijing offered $20 billion in credit to be used to help Chinese enterprises invest in infrastructure projects across the continent.

"China is doing a lot more yuan-based deals like this, particularly credit swap agreements that make it easier for the borrowing country to transact in RMB rather than USD," said Eric Orlander, co-founder of the China-Global South Project.

But Brazilian President Luiz Inacio Lula da Silva said the region must remain independent of world economic powers amid the global economic turmoil triggered by Washington's tariff wars.

Latin America and the Caribbean should not become a "stage for hegemonic disputes", Lula said in a speech at the summit opening.

"It's important to understand, (the fate of Latin America) doesn't depend on anyone else, it does not depend on President Xi Jinping, does not depend on the United States, it does not depend on the European Union, it depends solely and simply on whether we want to be great or continue to be small," Lula said.

Of the $240 billion worth of goods China bought from Latin America last year, just under half came from Brazil, the region's largest economy.

U.S.-CHINA COMPETITION

The China-CELAC forum has been a vehicle to deepen dialogue between China and the bloc over trade, investment and infrastructure cooperation under China's Belt and Road Initiative, challenging American geopolitical and economic dominance in the region.

While the U.S. remains a notable trading partner in Latin America, some countries especially in South America have stronger economic ties with China.

Brazil for one, has been aligning more closely with China, announcing more than $4.5 billion of upcoming Chinese investments in Brazilian sectors ranging from automaking and renewable energy to pharmaceuticals and semiconductors.