	Introduction

		Conditions in the Region

Latin America made enormous strides over the past two decades in political development, with all countries but Cuba having regular free and fair elections for head of state. Despite this democratic progress, several nations faced considerable challenges that threatenedpolitical stability, including economic decline and rising poverty, violent guerrilla conflicts,autocratic leaders, drug trafficking, and increasing crime. U.S. Policy

Congressional attention to Latin America in the 108th Congress focused on counter-narcotics and counter-terrorism efforts in the Andean region, security cooperation with Latin America, andtrade issues, such as free trade agreements with Chile and Central American countries and theregional Free Trade Area of the Americas (FTAA). Congress maintained an active interest inneighboring Mexico, with a myriad of trade, migration, border and drug trafficking issuesdominating U.S.-Mexico bilateral relations. U.S. counter-narcotics efforts in the region continued to focus on the Administration's Andean Counterdrug Initiative (2) supporting Colombia andits neighbors with foreign assistance in theirstruggle against drug trafficking and drug-financed terrorist groups. U.S. officials maintained that the most effective and rapid means to stimulate economic development in Latin America is through trade, and they set the goal of strengthening trade linkageswith the region through the negotiation of numerous free trade agreements (FTAs):
On June 6, 2003, the United States and Chile signed a bilateral FTA that had been completed in December 2002. On August 5,2004, all seven countries signed the U.S.-Dominican Republic-Central America Free TradeAgreement (DR-CAFTA). The Peace Corps was active in manyLatin American and Caribbean nations. (For additional information,see CRS Report RL32160 , Caribbean Region: Issues in U.S. Relations .) Some observers, including many from Latin America, maintained that the Bush Administration did not pay enough attention to the region and to the problems of economic and political stability inseveral countries. U.S. policy was criticized for having returned to a policy of benign neglect as theAdministration focused its attention on such pressing problems as the global anti-terrorismcampaign, the war in Iraq, and homeland security. Others suggest that despite its attention to crises and issues worldwide, the United States maintained an active policy toward Latin America. They point to the momentum for free trade inthe region and to the assistance and support provided to Colombia and its neighbors as they combatdrug trafficking and terrorist groups in the Andean region. Panama Trade Agreement. Congress continued its high level of interest in Cuba in the 108th Congress with a variety of legislative initiatives regarding sanctions and human rights. FMF would continue to be prohibited. As noted above ( U.S.-Latin American Trade Relations ),Congress did not consider implementing legislation for the DR-CAFTA by the end of the 108thCongress. U.S. assistance to Panamahas increased in the past several years with the country receiving assistance under the BushAdministration's Andean Regional Initiative to help Colombia and its neighbors combat drugtrafficking.
The Latin American and Caribbean region has made enormous strides over the past two decades in political development, with all countries but Cuba having regular free and fair elections for headof state. But several nations have faced considerable challenges that have threatened politicalstability, including economic decline and rising poverty, violent guerrilla conflicts, drug trafficking,and increasing crime.
Bush Administration officials maintain that U.S. policy toward Latin America has three overarching goals: strengthening security; promoting democracy and good governance; andstimulating economic development. Some observers argue that the Administration has not beenpaying enough attention to the region and to instability in several countries. They maintain that theUnited States, faced with other pressing foreign policy problems like the war in Iraq and the globalanti-terrorist campaign, has fallen back to a policy of benign neglect of the region. In contrast, othersmaintain that the United States has an active policy toward Latin America and point to theconsiderable assistance and support provided to Colombia and its neighbors as they combat drugtrafficking and terrorist groups. They also point to the momentum toward free trade in the regionthrough negotiation of numerous free trade agreements, and to increased bilateral and regionalcooperation on security issues.
Congressional attention to Latin America in the 108th Congress continued to focus on counter-narcotics and counter-terrorism efforts in the Andean region, trade issues, and potentialthreats to democracy and stability. U.S. counter-narcotics efforts focused on continuation of theAndean Counterdrug Initiative supporting Colombia and its neighbors in their struggle against drugtrafficking and drug-financed terrorist groups. With regard to trade, Congress approvedimplementing legislation for a bilateral free trade agreement with Chile in July 2003; the UnitedStates signed a combined U.S.-Dominican Republic-Central America Free Trade Agreement(DR-CAFTA) on August 5, 2004, but Congress did not consider implementing legislation before theend of the 108th Congress. Congress also paid increased attention to economic, social, and politicaltensions in South America that threatened democratic order, particularly in the Andean region. Inthe Caribbean, Haiti's persistent poverty and political instability remained a congressional concern,as did assistance to Haiti and other Caribbean nations in the aftermath of devastating damageincurred by hurricanes and storms in 2004. Congress also continued to debate the appropriate U.S.policy approach to Cuba, the region's only holdout to democracy, as it did for the past several years. Finally, Congress maintained an active interest in neighboring Mexico, with a myriad of trade,migration, border and drug trafficking issues dominating bilateral relations.
This report examines issues in U.S. policy toward Latin America and the Caribbean in the 108th Congress. It reflects final actions of the 108th Congress and will not be updated. For more detailsand discussion, see the listed CRS products after each section.