U.S. Foreign Assistance to Latin America and the Caribbean: FY2018 Appropriations

Summary

The United States provides foreign assistance to the nations of Latin America and the Caribbean to support development and other U.S. objectives. U.S. policymakers have emphasized different strategic interests in the region at different times, from combating Soviet influence during the Cold War to promoting democracy and open markets since the 1990s. Over the past year, the Trump Administration has sought to reduce foreign aid significantly and refocus U.S. assistance efforts in the region to address U.S. domestic concerns, such as irregular migration and transnational crime.

FY2018 Request

For FY2018, the Trump Administration requested $1.1 billion to be provided to Latin America and the Caribbean through foreign assistance accounts managed by the State Department and the U.S. Agency for International Development (USAID). This would be $614 million, or 36%, less than the $1.7 billion of U.S. assistance the region received in FY2017. The proposal would cut funding for nearly every type of assistance and would reduce aid for every Latin American and Caribbean nation. The Trump Administration also proposed the elimination of the Inter-American Foundation, a small, independent U.S. foreign assistance agency that promotes grassroots development in the region.

The Administration’s efforts to scale back U.S. assistance could have significant implications for U.S. policy in Latin America and the Caribbean. The proposed cuts could accelerate U.S. efforts to transition countries in the region away from traditional development assistance and toward other forms of bilateral engagement. Reductions in State Department-managed security assistance could lead to the Department of Defense taking on a larger role in U.S. security cooperation. Moreover, the Administration’s proposed cuts, combined with other policy shifts, could contribute to a relative decline in U.S. influence in the region.

Legislative Developments

On January 22, 2018, President Trump signed into law a fourth short-term continuing resolution (P.L. 115-120, preceded by P.L. 115-96, P.L. 115-90 and P.L. 115-56), which funds foreign aid programs at the FY2017 level, reduced by 0.6791%, through February 8, 2018. As Congress considers appropriations for the remainder of FY2018, it may draw from the Department of State, Foreign Operations, and Related Programs appropriations measures for FY2018 that were passed by the House (H.R. 3362, H.Rept. 115-253, which was included as Division G of House-passed H.R. 3354) and reported in the Senate (S. 1780, S.Rept. 115-152). The bills and their accompanying reports do not specify appropriations levels for every Latin American and Caribbean nation. Nevertheless, the amounts the measures designate for several significant initiatives indicate that total funding for the region would exceed the Administration’s request:

The House bill would provide $615 million to continue implementation of the U.S. Strategy for Engagement in Central America; the Senate bill would provide $600 million. The Administration requested $460 million.

The House bill would provide nearly $336 million to support the peace process and security and development efforts in Colombia; the Senate bill would provide $391 million. The Administration requested $251 million.

The House bill would provide nearly $137 million to support security and rule-of-law efforts in Mexico; the Senate bill would provide at least $144 million. The Administration requested $88 million.