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Summary

The Latin America and Caribbean region has made enormous strides over the past two decades in terms of political and economic development. While the region overall experienced an economic setback in 2002-2003, it rebounded in 2004, with a growth rate of 5.9%, and preliminary estimates for 2005 show a growth rate of 4.3%. Nevertheless, several nations face considerable challenges that could threaten political stability, including persistent poverty, violent guerrilla conflicts, autocratic leaders, drug trafficking, increasing crime, and the rise of radical populism in several Latin American countries. Legislative and oversight attention to Latin America and the Caribbean in the second session of the 109th Congress will likely focus on continued counter-narcotics efforts in the Andean region; trade issues, including the possible consideration of implementing legislation for one or more free trade agreements; potential challenges to democracy in Venezuela and Bolivia; ongoing efforts to bring political stability and ameliorate poverty in Haiti; efforts to foster change in Cuba; and cooperation on border security, migration, and anti-terrorism measures, especially with Mexico. Since 2000, the Andean Counterdrug Initiative (ACI) has been the primary U.S. program supporting the Colombian government's efforts to combat drug trafficking and terrorist activity perpetrated by guerrilla and paramilitary groups. In the first session, the 109th Congress approved the Administration's request to continue ACI funding in FY2006 at approximately the same levels as in previous years, and the second session will be considering the FY2007 request for ACI funding. In the trade arena, Congress approved legislation in 2005 (P.L. 109-53) implementing the U.S.-Dominican Republic-Central America Free Trade Agreement (DR-CAFTA) that had been completed in 2004. The second session of the 109th Congress may also consider additional free trade agreements, including one completed recently with Peru, and others currently being negotiated with Colombia, Ecuador, and Panama. With regard to democracy, Congress will likely focus on continued support to Haiti, the hemisphere's poorest nation that has hopes of electing a new government in early 2006. Venezuela will likely remain a congressional concern because of fears that President Hugo Chávez may be using his political power to push toward authoritarian rule. In Bolivia, the future government of newly elected president Evo Morales, a former leader of the coca growers union, could complicate U.S. relations in part because of his criticism of U.S. counternarcotics policy. With regard to U.S. policy toward Communist Cuba, Congress will likely continue to debate whether loosening or tightening the U.S. embargo will encourage political change. This report, which will be updated bimonthly, provides an overview of issues in U.S. relations with Latin America and the Caribbean, focusing especially on the role of Congress and congressional concerns. For further information, see the CRS products listed after each topic.

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