Mike Pence, the US vice president, will sharpen criticism of Chinese foreign policy with a blunt warning on Thursday that Washington will not back away from what it sees as Beijing’s intimidatory tactics in the South China Sea.

In a speech that also takes aim at China’s controversial use of huge loans to exert influence in developing countries, Pence will cite a recent near-miss between a US destroyer and Chinese vessel in the South China Sea as a sign of “reckless harassment” in the region.

The USS Decatur was forced to “quickly maneuver to avoid collision” with the Chinese naval vessel when it was conducting a “freedom of navigation” operation within 12 nautical miles of Gaven and Johnson Reefs in the Spratly Islands on Sunday, Pence will say.

“Despite such reckless harassment, the United States navy will continue to fly, sail and operate wherever international law allows and our national interests demand. We will not be intimidated. We will not stand down,” Pence will say, according to excerpts of the speech seen by Reuters

Washington sees the Decataur’s mission as part of an effort to counter Beijing’s desire to limit freedom of navigation in the strategic waters, where Chinese, Japanese and some south-east Asian navies operate. China’s defence ministry said one of its ships had been sent to warn the US vessel to leave and that Beijing had irrefutable sovereignty over the waters.

Pence will also accuse the Chinese Communist party of convincing three Latin American nations to sever ties with Taiwan and recognise China in a speech that will likely strain tensions between the US and China beyond the trade disputes that have dominated Donald Trump’s time as president.

Pence will also say China uses “debt diplomacy” to expand its influence worldwide.

“Today, that country is offering hundreds of billions of dollars in infrastructure loans to governments from Asia to Africa to Europe to even Latin America. Yet the terms of those loans are opaque at best, and the benefits flow overwhelmingly to Beijing,” he will say.

Beijing has extended a lifeline to “the corrupt and incompetent Maduro regime in Venezuela,” pledging $5bn in loans that can be repaid with oil, the speech says.

Pence will say the US intelligence community has determined that China is targeting US state and local governments and officials to exploit any divisions between federal and local levels on policy.

“It’s using wedge issues, like trade tariffs, to advance Beijing’s political influence,” he will say, with the goal of shifting Americans’ perception of Chinese policies by mobilizing “covert actors, front groups, and propaganda outlets”.

“As a senior career member of our intelligence community recently told me, what the Russians are doing pales in comparison to what China is doing across this country,” Pence will say.

He will also argue that Chinese officials have tried to influence business leaders to condemn US trade actions, “leveraging their desire to maintain their operations in China”.