	Conditions in the Region

The Latin America 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 head of state. Despite this democratic progress, 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. Presidents were re-elected in four races—Brazil, Colombia, Guyana, and Venezuela—and in five countries, former heads of government returned to power—Costa Rica, Haiti, Nicaragua, Peru, and St. Lucia. Only Guyana experienced an economic setback of 3% in 2005. U.S. Policy Overview

Legislative and oversight attention to Latin America and the Caribbean in the 109 th Congress focused on continued counternarcotics efforts in the region; trade issues, including the approval of implementing legislation for the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA); challenges to democracy in the region, especially in Venezuela; efforts to bring political stability and ameliorate poverty in Haiti; efforts to foster political change in Cuba; and cooperation on migration, border security, and anti-terrorism measures, especially with Mexico. From FY2000-FY2006, the United States has provided around $5 billion for the Andean Counterdrug Initiative (ACI), the primary U.S. program supporting the Colombian government's efforts to combat drug trafficking and terrorist activity perpetrated by guerrilla and paramilitary groups. The 109 th Congress approved the Administration's request to continue ACI funding in FY2006 at approximately the same levels as in previous years. Action was not completed on FY2007 foreign aid appropriations, so the 110 th Congress will need to take action early in 2007. In the trade arena, Congress approved legislation in July 2005 ( P.L. 109-53 , signed into law August 2, 2005) implementing the DR-CAFTA that had been completed in 2004. In 2006, free trade agreements (FTAs) with Peru and Colombia were signed in April and November, respectively, and on December 19, U.S.-Panamanian FTA negotiations were completed. Implementing legislation for all three countries could be introduced early in the 110 th Congress. In late 2006, Congress also extended trade preferences for Andean imports and approved a special trade preferences measure for imports from Haiti as part of a trade and tax-extension bill ( P.L. 109-432 , Division D, Titles V and VII). With regard to democracy and political stability, Congress focused on continued support to Haiti, the hemisphere's poorest nation, under the new government of Rene Preval. Venezuela—a major supplier of oil to the United States—remained a congressional concern because of fears that President Hugo Chávez was using his political power to push toward authoritarian rule and to support leftist groups in other Latin American countries. With regard to U.S. policy toward Communist Cuba, Congress has continued to focus on the poor human rights situation and to debate whether loosening or tightening the U.S. embargo will encourage political change. 4437 and S. 2611 ), but did not complete action on the measures.
Over the past two decades, the Latin America and Caribbean region has made enormous strides in terms of political and economic development. In 2006, elections for head of government were held in 12 countries in the region, including the close election in Mexico in July, the re-election of presidents in Brazil, Colombia, Guyana, and Venezuela, and the election of former heads of government in Costa Rica, Haiti, Nicaragua, Peru, and St. Lucia. Although the region overall experienced an economic setback in 2002-2003, it has rebounded since 2004. Nevertheless, several nations faced considerable challenges that threatened political stability, including persistent poverty, violent guerrilla conflicts, autocratic leaders, drug trafficking, increasing crime, and the rise of a new form of populism in several countries.
Legislative and oversight attention to Latin America and the Caribbean in the 109th Congress focused on continued counternarcotics efforts; trade issues; challenges to democracy, especially in Venezuela; efforts to bring political stability and ameliorate poverty in Haiti; efforts to foster political change in Cuba; and cooperation on migration and border security, 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; the second session considered, but did not complete action, on the FY2007ACI request of $721.5 million, so the 110th Congress will need to take action early in 2007.
In the trade arena, Congress approved legislation in 2005 (P.L. 109-53) implementing the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA) that had been completed in 2004. In 2006, free trade agreements (FTAs) with Peru and Colombia were signed in April and November, respectively, and on December 19, U.S.-Panamanian FTA negotiations were completed. Implementing legislation for all three countries could be introduced early in the 110th Congress. In late 2006, Congress also extended preferences for Andean imports and approved a special trade preferences measure for imports from Haiti as part of a trade and tax-extension bill (P.L. 109-432, Division D, Titles V and VII).
With regard to democracy, Congress provided continued support to Haiti, the hemisphere's poorest nation, under the new government of Rene Preval. Venezuela remained a congressional concern because of fears that President Hugo Chávez has been using his political power to push toward authoritarian rule. With regard to U.S. policy toward Cuba, Congress continued to debate whether loosening or tightening the U.S. embargo would encourage political change.
This report provides an overview of U.S. relations with Latin America and the Caribbean, focusing on the role of Congress and congressional concerns in the 109th Congress. It reflects final actions of the 109th Congress and will not be updated. For further information, see the CRS products listed after each topic.