Latin America: Views on the Enterprise for the Americas Initiative

GAO discussed the Enterprise for the Americas Initiative, a U.S.-proposed approach to stimulate sustained economic development in Latin American and Caribbean countries. GAO noted that: (1) the Initiative called for expansion of two-way trade negotiations, implementation of free-trade negotiating agreements, reduction and restructure of bilateral debt, and the promotion of direct investment in Latin American and Caribbean countries; (2) Congress has enacted or was working on legislation for cooperative promotion of economic growth, complete with plans for the expansion of trade and investment, reduction of debt, and promotion of environmental conservation; (3) the extent of trade benefits was contingent upon the successful conclusion of multilateral trade negotiations; (4) the Initiative included such preconditions for participation as economic reform plans, major and open investment reforms, and satisfactory commercial debt financing programs; and (5) the U.S. government would provide some funding by setting aside the interest paid in trust funds on restructured bilateral concessional debts. GAO believes that: (1) future legislation may be needed to address the trade portion of the Initiative; and (2) the Agency for International Development will play a greater role than was anticipated in implementing debt and environmental issues and Initiative programs.