LAC Regional
The Development Challenge: The Latin America and Caribbean (LAC) region has evolved from
decades marred by internal wars and authoritarian regimes to relative peace and stability. Colombia
continues in conflict, while Venezuela and Bolivia have become less stable. Still, on balance, the region
has normalized over the last several decades as countries have shifted from authoritarian rule to
participatory, constitutional democracy. Even where governments fall due to popular pressure (as in
Ecuador, Argentina, and Bolivia), they have managed to remain within constitutional constraints.
 |
|
Please note: All documents are in pdf format |
The region’s gross domestic product shrank by 0.8% in 2002, the worst economic performance since
1983. Last year's inflation edged up to 12% after eight years of steady decline, but is on track to return to
trend at 8%-9% this year. Several countries with worrisome problems in the past are now in good
standing with the International Monetary Fund. LAC’s economy overall is expected to grow slightly in
2003, perhaps by 2.8%, and by 3% or more in 2004. Countries that have adopted sound fiscal policies
and oriented their economies toward foreign investment and rules-based trade under the World Trade
Organization have tended to resist the recent downturn better than those which have not taken such
steps. These countries stand to benefit more from the nascent world-wide and U.S. economic recovery
and the related world-wide bull market in commodities. Further, the North American Free Trade
Agreement (NAFTA) has contributed substantially to economic growth for its three partners. Since 1993,
trade among the NAFTA countries has increased dramatically and U.S. merchandise exports have nearly
doubled.
Despite these promising indicators of economic recovery, mediocre economic performance has caused
per capita income in LAC countries to decline significantly since 1998, and overall poverty has increased.
These woes have brought political discontent and turbulence, and raised questions about the health of
democracy in the region; investment priorities; social sector policies; and the benefits of a decade of
liberal reforms, even if sometimes halfhearted. The effects in the poorest countries, such as Haiti, and
even regions within countries with generally solid economic performance, such as northeast Brazil, have
been even more disheartening.
In education, the quality and equity of primary and secondary education are major problems. In most of
Latin America, nearly one half of the children who enter primary school fail to make it to the fifth grade
and only about 30% graduate from secondary school. Moreover, poor, rural, and indigenous students are
least likely to be enrolled in school at any level and tend to score lower on achievement tests. Great
inequities remain in the access to, and delivery of, quality health care in the LAC region. Maternal and
neonatal mortality rates remain unacceptably high and antimicrobial resistance patterns are on the
increase. The Caribbean region has the second highest HIV/AIDS rate in the world. The entire LAC
region has over two million people living with HIV, including the estimated 200,000 that contracted HIV in
the past year. Other infectious diseases, such as dengue, are also posing an emerging threat.
Despite continued success in introducing new technologies for clean production in industry and improved
practices in park and protected areas management, the environment in LAC region suffers from
accelerating rates of severe degradation. This degradation is evident in the loss of many coastal reefs,
eroded watersheds, and polluted water. It results in increased vulnerability to disasters and health
problems, conflicts over natural resources, and reduced economic opportunities.
The Summit of the Americas continues to influence the foreign policy agenda in the region and has forged
greater commitment among the 34 nations of the hemisphere to mutually agreed-upon priorities for
addressing areas of critical concern. A special, interim summit in January 2004 will solidify a robust set of
targets for economic growth, social sector reform, and good governance, to which regional program
resources will be dedicated.
The USAID Program: The Data Sheets below cover the eight objectives for which USAID is requesting
FY 2004 and FY 2005 funds. These objectives focus on supporting the FTAA through regional trade
capacity building and improving market access; strengthening democratic institutions and processes;
improving the quality of education; protecting the region’s biodiversity; supporting new environmental
technologies and partnerships; improving the health status of the region’s population, with a particular
emphasis on women and disadvantaged groups; program development and assessment; and advancing
development cooperation opportunities in the hemisphere. In FY 2004, USAID will fund a follow-on
strategic objective in health while continuing to support efforts in democracy, economic growth, education
and the environment. In FY 2005, USAID plans to continue the activities in economic growth,
environment, democracy and health. USAID will transfer $5,000,000 to the Department of State in FY
2005 to fund activities in anti-corruption and support the Summit of the Americas.
Other Program Elements: The LAC Regional program has been instrumental in developing several
alliances and partnerships to benefit multiple countries in LAC. These include public-private partnerships
to address the coffee crisis in Central America, protect the Meso-American coral reef, develop the
certified timber industry in selected countries, improve basic reading skills of primary school children, and
use remittances to promote increased access of the poor to financial services.
Other Donors: The United States is the largest provider of Official Development Assistance among all
bilateral donors in the LAC region. Other major donors include the European Union, Japan, the
Netherlands and Germany. Coordination with the World Bank, Inter-American Development Bank (IDB),
Organization of American States (OAS), Pan American Health Organization (PAHO), and other regional
and international organizations is excellent and helps USAID to promote U.S. foreign policy interests in
the region, influence development policy, and shape the direction of other donor’s programs. USAID also
collaborates extensively with other U.S. agencies including the Departments of State, Justice, Agriculture,
Education, and Health and Human Services, the U.S. Trade Representative, Environmental Protection
Agency, and others. In the economic growth area, USAID, IDB, OAS and the Economic Commission for
Latin America and the Caribbean collaborate to help Central American countries identify their trade
capacity needs in preparation for the CAFTA. In the environment sector, USAID has partnered with the
United Nations (UN) Foundation and various environmental NGOs and private industry to protect the
Meso-American coral reef. In education, USAID is developing a public-private partnership to support the
Presidential Summit Initiative, the Centers of Excellence for Teacher Training. USAID continues to
collaborate with the World Bank, IDB, OAS, PAHO, and the UN to support the Inter-American Coalition for
the Prevention of Violence in the Americas to promote national strategies to combat crime and violence.
USAID works closely with PAHO, IDB, and the World Bank to implement its health initiatives.
Back to Top ^
|
