Updated July 1, 2020
Latin America and the Caribbean: U.S. Policy Overview
U.S. interests in Latin America and the Caribbean are
regional economic growth rate of 1.6% in 2020, but its
diverse and include economic, political, security, and
revised forecast in June 2020 projects a 9.4% economic
humanitarian concerns. Geographic proximity has ensured
contraction. The U.N. Economic Commission for Latin
strong economic linkages between the United States and the
America and the Caribbean projects that almost 29 million
region, with the United States a major trading partner and
people in the region will move into poverty in 2020. Many
source of foreign investment for many countries. Free-trade
countries may struggle with protracted recoveries.
agreements (FTAs) have augmented U.S. economic
relations with 11 countries in the region. The Western
Trump Administration Policy
Hemisphere is a large source of U.S. immigration, both
Under the Trump Administration, U.S. relations with Latin
legal and illegal; with proximity and economic and security
America and the Caribbean generally have moved toward a
conditions the major factors driving migration trends.
more confrontational approach from one of engagement and
partnership during past Administrations. In 2018, the State
Curbing the flow of illicit drugs from Latin America and
Department set forth a framework for U.S. policy toward
the Caribbean has been a key component of U.S. relations
the region focused on three pillars for engagement—
with the region for decades. The flow of illicit drugs,
economic growth and prosperity, security, and democratic
including heroin, methamphetamine, and fentanyl from
governance. The framework reflects continuity with long-
Mexico and cocaine from Colombia, poses risks to U.S.
standing regional U.S. policy priorities, but it appears at
public health and safety. Since 2000, Colombia has
odds with the Administration’s sometimes antagonistic
received support through Plan Colombia and its successor
actions and statements on immigration, trade, and foreign
programs. For over a decade, the United States also has
aid. According to Gallup and Pew Research Center polls,
sought to forge partnerships with other countries to combat
negative views of U.S. leadership in the region have
drug trafficking and related violence and to advance citizen
increased markedly during the Trump Administration.
security, including through the Mérida Initiative, begun in
2007 to support Mexico; the Central America Regional
Foreign Aid. The Administration’s proposed foreign aid
Security Initiative (CARSI), begun in 2008; and the
budgets for the region would have cut assistance levels by
Caribbean Basin Security Initiative (CBSI), begun in 2009.
more than a third in FY2018 and FY2019 and by 30% in
FY2020. Congress essentially rejected those requests by
Another long-standing component of U.S. policy is support
providing significantly more assistance in appropriations
for democratic governance and the rule of law. U.S. policy
measures. In 2019, the Trump Administration withheld
efforts have supported democracy promotion, including
some assistance to the “Northern Triangle” countries of
support for strengthening civil society and promoting
Central America (El Salvador, Guatemala, and Honduras)
human rights and the rule of law.
to compel governments to curb the flow of migrants to the
United States. The FY2021 request of $1.4 billion would
Increasing Chal enges in the Region
cut aid to the region by 18%, but a large proposed increase
Over the past several years, the quality of democracy has
to support a potential democratic transition in Venezuela
eroded in numerous countries, along with public
masks significantly larger cuts for many countries and
satisfaction with how democracy is working. Venezuela has
programs. In response to the COVID-19 pandemic, as of
descended into a dictatorship under President Nicolás
mid-June 2020, the Administration had announced almost
Maduro, and Cuba and Nicaragua are ruled by authoritarian
$113 million in new and previously announced assistance to
governments repressing the political opposition. In 2019,
help the region respond to the pandemic.
many countries in the region experienced social unrest
fueled by political factors such as fraudulent elections,
Trade. In 2017, President Trump ordered U.S. withdrawal
weak democratic institutions, politicized judicial systems,
from the proposed Trans-Pacific Partnership (TPP) FTA
public corruption scandals, high levels of crime and
negotiated in 2015 by 12 Asia-Pacific countries; the TPP
violence, and organized crime’s effect on state institutions.
would have increased U.S. economic linkages with Chile,
Economic factors such as declining or stagnant growth
Mexico, and Peru, which were parties to the agreement. The
rates, high levels of income inequality, and increased
President strongly criticized the North American Free Trade
poverty also increased social pressure.
Agreement (NAFTA) with Mexico and Canada and
repeatedly threatened U.S. withdrawal. The Administration
In 2020, the Coronavirus Disease 2019 (COVID-19)
initiated renegotiations in 2017, and the three countries
pandemic is having widespread economic, social, and
agreed in 2018 to a new United States-Mexico-Canada
political effects in the region. Infections and deaths are
Agreement (USMCA) that retained many of NAFTA’s
currently surging in some countries, especially Brazil,
provisions and included modernizing features and new
Mexico, Peru, and Chile. As of July 1, 2020, the region had
provisions on the auto and dairy industries.
almost 2.6 million cases and over 116,000 deaths. Before
the pandemic, the International Monetary Fund projected a
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Latin America and the Caribbean: U.S. Policy Overview
Mexico, Central America, and Immigration. Relations
The 116th Congress completed action on FY2019 foreign
with Mexico have been tested because of inflammatory
aid appropriations when it enacted the Consolidated
anti-immigrant rhetoric and immigration actions that have
Appropriations Act, 2019 (P.L. 116-6), in February 2019.
shifted the burden of interdicting migrants and offering
Amounts appropriated for key U.S. initiatives and countries
asylum to Mexico. In 2017, the Administration announced
exceeded the Administration’s request by almost $600
it would end the Deferred Action for Childhood Arrivals
million. Congress completed action on the FY2020 foreign
(DACA), a program begun in 2012 that provides relief from
aid budget in December 2019, when it enacted the Further
deportation for certain immigrants who arrived as children;
Consolidated Appropriations Act, 2020 (P.L. 116-94);
a federal court challenge ultimately led to a June 2020
amounts for key countries and regional programs once
Supreme Court decision rejecting the procedures that the
again significantly exceeded the Administration’s request.
Administration used in rescinding DACA. In 2018,
In February 2020, Congress began consideration of the
Mexico’s president agreed to allow the United States to
Administration’s FY2021 foreign aid request.
return certain non-Mexican migrants to Mexico while
In January 2020, Congress completed action on
awaiting U.S. immigration court decisions.
implementing legislation for the USMCA (P.L. 116-113),
Other Administration actions on immigration have caused
which enters into force on July 1. Before legislative
concern in the region. In 2017, the Administration it would
approval, the agreement was amended to address
terminate Temporary Protected Status (TPS) designations
congressional concerns regarding provisions on labor
for Nicaragua, Haiti, El Salvador, and Honduras, but federal
(including enforcement), the environment, dispute
court challenges have put the terminations on hold.
settlement, and intellectual property rights.
Unauthorized migration from Central America has
On Venezuela, in December 2019, Congress enacted the
increased in recent years, fueled by difficult socioeconomic
VERDAD Act of 2019 in Division J of P.L. 116-94, which,
and security conditions and poor governance. The
among its provisions, codifies several sanctions and
Administration has used various policy tools to deter such
authorizes humanitarian assistance and support for
migration. In addition to aid cuts and threats of increased
international election observation and democratic civil
U.S. tariffs and taxes on remittances, these tools have
society. The measure incorporates provisions from S. 1025
included controversial asylum cooperation agreements—
and three March 2019 House-passed bills: H.R. 854; H.R.
also referred to as safe third country agreements—with
920, and H.R. 1477. In July 2019, the House also approved
Guatemala, El Salvador, and Honduras to permit the United
H.R. 549, which would provide TPS to Venezuelans.
States to transfer asylum applicants from third countries to
the Northern Triangle countries.
The FY2020 National Defense Authorization Act (P.L.
116-92), approved in December 2019, includes provisions
Venezuela, Cuba, and Nicaragua. As the situation in
on Venezuela and Guatemala and reporting requirements on
Venezuela has deteriorated, the Trump Administration has
Brazil, Honduras, Central America, and Mexico.
imposed targeted and broader financial sanctions, including
sanctions against the state oil company, the country’s main
In other action, the House approved H.R. 133 in January
source of income. In January 2019, the Administration
2019, which would promote U.S.-Mexican economic
recognized the head of Venezuela’s National Assembly,
partnership and exchanges; the Senate approved an
Juan Guaidó, as interim president. The Administration also
amended version in January 2020. The House approved
is providing humanitarian and development assistance for
H.R. 2615 in July 2019, which would authorize assistance
Venezuelans who have fled to other countries, especially
to Central America’s Northern Triangle countries. The
Colombia, and for Venezuelans inside Venezuela.
Senate approved S.Res. 35 in April 2019, expressing
support for democratic principles in Bolivia, S.Res. 447 in
On Cuba, the Trump Administration has abandoned the
January 2020, supporting new Bolivian elections, and
policy of engagement advanced during the Obama
S.Res. 454 in June 2020 calling for the unconditional
Administration and imposed economic sanctions on Cuba
release of Cuban human rights activist José Daniel Ferrer
for its poor human rights record and support for the Maduro
and all members of the Patriotic Union of Cuba. Both
government in Venezuela. Sanctions have included
houses also approved resolutions commemorating the 25th
restrictions on travel and remittances and efforts to disrupt
anniversary of the 1994 bombing of the Argentine-Israeli
oil flows from Venezuela. In 2017, the State Department
Mutual Association in Buenos Aires (H.Res. 441 in July
cut the staff of U.S. Embassy Havana by about two-thirds in
2019 and S.Res. 277 in October 2019); and expressing
response to unexplained injuries of U.S. diplomatic staff.
support for U.S. efforts to promote democracy and human
rights in Nicaragua (H.Res. 754 in March 2020 and S.Res.
Since political unrest in Nicaragua against the government
525 in June 2020).
of President Daniel Ortega began to grow in 2018, the
Trump Administration has employed targeted sanctions
For more, see CRS In Focus IF11581, Latin America and
against several individuals due to their alleged ties to
the Caribbean: Impact of COVID-19; and CRS Report
human rights abuses or significant corruption.
R46258, Latin America and the Caribbean: U.S. Policy and
Issues in the 116th Congress.
Congressional Action in the 116th Congress
Congress traditionally has played an active role in policy
Mark P. Sullivan, Specialist in Latin American Affairs
toward Latin America and the Caribbean in terms of both
legislation and oversight.
IF10460
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Latin America and the Caribbean: U.S. Policy Overview


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https://crsreports.congress.gov | IF10460 · VERSION 14 · UPDATED

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