Democracy and Governance: Latin America and Caribbean Regional
The Development Challenge: The Latin America and Caribbean (LAC) region has emerged from decades of conflict to relative peace and stability. Centralized economies have given way to privatized competitive markets, and the region is readying, with U.S. support, for the opportunities and challenges of a Free Trade Area of the Americas as well as sub-regional and bilateral free trade agreements. Authoritarian rule has also given way to democratically elected governments, with Cuba the notable exception. Free and fair elections conducted under the control of professional, national electoral commissions are now the rule.
There has been significant progress in consolidating democracy but much still remains to be done. The 2004 national "Latinobarometro" surveys show widespread concern with political corruption and rising crime rates. Democratic institutions are perceived to be weak; and, many citizens are losing confidence in the way democracy works and are questioning whether democracy is the best form of government. There is also growing support for national populist leaders in the region. This is especially true in Venezuela and to a lesser degree Bolivia, Peru and Ecuador where politicians have been gaining popularity with the general electorate, without support from the intellectual, civil society or business sectors.
On the economic front, almost every country in the region is experiencing a modest recovery from the recent global economic downturn. In its Economic Survey of Latin America and the Caribbean, 2003-2004, the Economic Commission for Latin America and the Caribbean noted that gross domestic product (GDP) went from a negative 0.8% in 2002 to 1.5% in 2003, and GDP is projected to grow to 4.5% in 2004. Per capita income will rise 3% in 2004, but following the stagnation of the late 1990s and early 2000s, this will only bring it back to the 1998 level. The relative competitiveness of LAC countries is also weak, and the disparaty between LAC and South Asia countries continues to widen with respect to indicators of productivity and export growth. Despite the last two years of positive real economic growth, the unemployment rate remains high (10.3% in the first half of 2004), nearly half of the region's people live in poverty and crime rates have increased.
The Summit of the Americas continues to influence the United States' foreign policy interests and USAID's LAC Regional program. In preparation for the Special Summit held in Monterrey, Mexico in January 2004, USAID was selected as the lead agency for three of the seven Special Summit action areas (education, property and business registration) and as co-lead for remittances. USAID worked closely with the State Department and the National Security Council to shape the Summit agenda in these areas and developed regional programs to support U.S. Government commitments. Through participation in the Summit process, extraordinarily high level attention has been directed toward USAID development goals in the LAC region and tangible progress has been achieved in each action area.
(Excerpted from the 2006 Congressional Budget Justification for Latin America and Caribbean Regional)
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