![[ToC]](../images/cpbanner.gif)
The last decades have brought revolutions in communications, technology and transportation. In addition there is now a spreading consensus on the need for democracy and open economic systems. These have combined to bring Latin America and the Caribbean (LAC) closer than ever before to the United States. Distances and barriers are falling away; tremors in the LAC region reverberate across our own nation. Never before have U.S. interests there been so directly tied to the well-being of U.S. citizens here. Never before has the United States had such an opportunity to influence--for the benefit of our entire hemisphere--the path of history in the LAC region.
Whether it is trade, the Central American Peace Process, the drug traffic from the Andes, our shared environment, events in the region directly and immediately affect vital U.S. interests. USAID's activities in the LAC region directly support these U.S. national interests
USAID's programs target the key problems of the region and advance the promises of the Summit of the Americas--a growing, free and more just hemisphere of democracies and the establishment of the Free Trade Area of the Americas by the year 2005.
Few regions in the world approach LAC's past record of political instability. Latin American countries have had 253 constitutions since independence, an average of 12 per country. Twenty years ago, with the exception of the English-
speaking Caribbean, only four countries had elected civilian governments. Military dictatorships and state-directed economic systems were the norm, and respect for fundamental human rights under those regimes was nonexistent. Today, all save Cuba have governments chosen by multi-party elections. Economic systems have been transformed by a market revolution. Respect for accepted human rights norms and due process are increasingly protected by law and, by and large, respected. Nongovernmental human rights organizations are vigilant. Nonetheless, democratic institutions are fragile. Ethnic, party, and class pressures, and the corrosive assault of narcotics traffickers, endanger them. The initial stage of macroeconomic reforms have now taking hold. The deeper institutional changes which are now necessary to sustain the market transformation and deepen democracy in the region will be much more difficult. The challenge confronting governments and peoples is formidable: to ensure growth with equity; to meet essential health, education, and family planning needs; and to preserve the region's rich natural resource base.
Development Challenges. Despite this great progress, millions of citizens still do not participate fully in the formal economies and democratic systems. More than 40% of the region's people endure lives in poverty. Helping the region's poor to achieve a higher standard of living will not only permit them to live fuller, more satisfying lives, it also means that a potential market of 200 million people will become customers for U.S. products.
To meet this challenge, USAID has adopted a sustainable development strategy. This approach tackles the problem of permanently reducing poverty: broad-based growth, building democracy, reducing population growth, improving health and education, and protecting the environment. To achieve this significant and sustained reduction in poverty, USAID balances activities that promote long-term, broad-based economic growth with those that directly and immediately address the health, education, population and production problems of the poor. In 1997, USAID will focus on the 16 of the region's 32 democracies in which there is both the greatest need and the promise for improvement.
External Debt. The international debt crisis that erupted in 1982 threatened the international financial system and turned the 1980s into a lost decade for Latin America. The crisis primarily resulted from debts to commercial banks, but official deb also contributed. The crisis forced governments to undertake significant economic reforms. By the early 1990s, inflation had declined, growth was recovering, and the major debtors made arrangements to reduce bank debt in exchange for improved security for remaining balances. Countries on the verge of default in the early 1980s are now returning to the international financial markets. However, success in reducing inflation, growth, and trade arejust now bringing peoples' incomes back to levels of a decade and a half ago. Inefficient public institutions, lack of investment in people, and skewed income distribution endanger both prosperity and political stability. The challenge for LAC countries is to harmonize macroeconomic stability with quicker reductions in poverty and inequality.
The poorest countries still face debts which they cannot sustain. The problems of these countries will be addressed through debt forgiveness carried out together with other countries in the "Paris Club". For other heavily indebted but higher income countries, other arrangements to make debts manageable may be worked out through the debt markets.
Donor Coordination. Donor coordination is a critical tool to build on USAID's substantial investment in the region, leveraging additional resources in order to promote U.S. objectives. Multilateral development banks (MDBs) have assumed an increasingly important role in the poorer countries of the region where USAID has its major activities. The Inter-American Development Bank (IDB) loans on concessional terms to five of USAID's 12 core countries reached $1.1 billion in 1995. World Bank concessional loan commitments added another $345 million in F 1995. Though USAID resources have been significantly reduced, we remain the region's most important bilateral donor with Development Assistance and Economic Support Funds of $420 million for F 1995.
USAID works closely with these multilateral development banks and encourages them to expand lending in the social sectors, democracy and governance, and the environment. The banks consider USAID's in-country expertise to be a valuable resources they enter these new lending areas. The Summit of the Americas also serves as an important framework for more extensive donor coordination.
The results of greater donor collaboration are evident. In Honduras, Bolivia and El Salvador, for example, USAID, the IDB and the World Bank have worked together to develop major judicial reform programs which expand USAID initiated activities. In El Salvador, USAID health and education programs are the basis for major health reform and primary education programs of the multilateral banks. USAID has established a joint working group on democratization in Latin America with European Community. All these support U.S. objectives under the Summit of the Americas.
In Haiti USAID played a strong leadership role coordinating donor support for reconstruction. USAID participated in programming missions with the IDB, the World Bank and other donors, to develop major projects in primary education, potable water, and other social programs. IDB loan approvals to Haiti in 1995 reached $318 million. Our collaboration with other bilateral donors, including the European Community, resulted in important judicial reforms in Haiti.
These efforts supporting U.S. objectives are the fruit of a strong USAID field presence. USAID influence has been further increased by placing advisors on site at the Inter-American Development Bank and the World Bank to assist the U.S. Executive Directors.
Program Concentration. Population programs in 12 of our 16 countries continue to reduce fertility. With nearly 65% of couples using contraception in Brazil, this will be the last year of funding there by USAID. The Government of Mexico is expanding its budget to include family planning, and the USAID program there will end in F 1999. Other population programs in the region are also reaching their objectives. In Peru, family planning services are provided together with assistance to help rural women to increase their incomes. In Jamaica, teenagers who leave school are helped to complete their education and avoid unwanted pregnancies through an innovative new program. In Central America, population programs continue to expand in the former conflictive zones in El Salvador, Guatemala and Nicaragua.
Environment programs in Brazil and Mexico to help reduce global climate change, preserve biodiversity on the east side of the Andean mountains, and environmentally safe practices for agriculture and forestry throughout the region. Activities initiated in F 96 under the Environmental Initiative for the Americas Program will be followed in F 1997 by increased support for urban and industrial pollution abatement, renewable energy, and preservation of coral reefs in the Caribbean.
Democracy programs support the peace accords in Central America by helping complete the transition from war to peace in El Salvador, consolidating the economic and democratic transition in Nicaragua, and assisting andsupporting Guatemala's transition to peace. Haiti will continue its effort to resume economic growth and consolidate democracy with our assistance. We will continue to help Panama take over full operation of the Panama Canal and to make optimal use of reverted properties. Good governance and anticorruption programs in the Dominican Republic, Ecuador, Guyana, Honduras, and Paraguay will continue. Improving human rights and administration of justice, promoting open, transparent and accountable government, supporting free and fair elections, and advancing the development of civil society are the main objectives.
Within the economic growth area, USAID is helping to reduce the spread of the AIDS epidemic, particularly in Central America. Child survival and health programs aim to insure sustainable and quality primary health coverage. Basic education programs emphasize girls education and basic literacy skill to help new market entrants. We will continue to support economic policy reform, free-trade negotiations, alternative export strategies, microenterprise, and programs aimed at incorporating Central American excombatants, and other excluded groups, into the formal economy.
U.S. NATIONAL INTERESTS
Latin America is unique in the developing world as events there, both positive and negative, have direct and immediate impact on the United States. The United States stands to benefit greatly from helping LAC countries realize their shared vision. Indeed, the most vital U.S. national interest -- the health of the U.S. domestic economy -- depends in no small measure on the economic health of the other countries in the hemisphere. The LAC region is the fastest growing market for U.S. exports of goods and services, and one of the largest.
U.S. exports of goods and services to the LAC countries reached an estimated $104 billion in 1995, more than twice their level only five years ago. These exports now support nearly 2 million jobs in the United States. The U.S. trade balance with the LAC region has gone from a deficit of $8 billion in 1990 to an estimated surplus of $5 billion in 1994. The U.S. market share of LAC countries' imports from developed market countries rose from 48% in 1986 to 57% in 1993. Almost half of all U.S. exports to developing countries go to the LAC region.
In 1994, U.S. exports to the seven Central American countries which have USAID programs ($6.7 billion) exceeded the combined U.S. exports to the 13 Eastern Europe countries ($2 billion) and the 16 New Independent States (NIS) of the former Soviet Union ($3.6 billion).
U.S. economic growth and employment depend far more on the growth of LAC economies than on any other part of the developing world. In 1994 the LAC region accounted for more than 70% of all U.S. exports to USAID-assisted countries, while the share of the Africa, Asia, Near East, Europe and New Independent States regions combined was 30%. With 200 million people in the region still living in poverty and with 40% of all LAC imports coming from the United States, regional development has the potential to vastly increase U.S. exports and jobs.
Billions of investment dollars and millions of tourists flow both ways across common borders. U.S. direct investment in LAC ($115 billion, 1994) is almost twice the combined total of Asia and the Pacific ($47 billion), Near East ($8.5 billion), sub-Saharan Africa ($3.7 billion) and Eastern Europe and the NIS ($4.2 billion). U.S. direct investment in USAID-assisted countries in the LAC region totaled $81 billion in 1994, 76% of all U.S. direct investment in USAID assisted countries. U.S. direct investment in Ecuador and Peru alone exceeds that in the entire Middle East outside Saudi Arabia.
The health of the U.S. economy will become even more dependent on the economic health of the LAC region in the future. Not only is the region a natural market for the United States, but the Summit declaration committed the countries of the hemisphere to conclude negotiations for a Free Trade Area of the Americas (FTAA) by 2005. The FTAA will produce a vastly expanded market for U.S. products. It will encompass 34 countries with a current total population of about 750 million and a combined gross domestic product (GDP) of more than $8 trillion.
Strong democracies in LAC countries are essential to maintaining the United States' own high quality of life. Democratic governments with shared values are key to making significant progress on many issues of interest to the United States, such as economic integration, pollution reduction, global warming, biological diversity, narcotics trafficking, public health, and AIDS prevention. Strong democracies also will lead to reduced emergency assistance and lower U.S. defense expenditures in the region over the long run.
According to the latest data from Immigration and Naturalization Service, the world's top three sources of undocumented immigrants into the U.S. are from Latin America. Eleven of the top 15 sources of illegal immigrants are in LAC. El Salvador alone has sent more illegal immigrants to the United States than all of Europe, all of Asia, and all of Africa. More illegal immigrants came to the United States from Haiti and the Dominican Republic in 1992 than from the continent of Africa. Some 72.5% of the entire total of illegal immigrants have come from LAC.
The proximity of the LAC region poses special population and health concerns for the United States. Rapid population growth strains the hemisphere's resources, resulting in shortages, environmental degradation, and pollution. Population pressures contribute to increased illegal migration to the United States. Communicable diseases such as cholera, HIV/AIDS, and measles cause problems in our own country if they are not addressed in the region. LAC initiatives to eradicate polio and to eliminate measles are critical to the success of U.S. public health efforts. The accelerating transmission of HIV within the region is also disturbing. Nearly two million HIV infections have been recorded in the region, and the epidemic is growing by about 1,000 cases per day. By contrast, the U.S. has about one million infections. In view of current migration and travel patterns, the epidemic in LAC threatens not only to thwart the region's development but also to aggravate U.S. control efforts.
The recent efforts of the LAC countries to reform themselves have created an opportunity for well-targeted U.S. assistance to have a high payoff in helping LAC countries achieve goals which promote U.S. interests. As host and principal organizer of the Summit, the United States has a special role in supporting the accomplishment of Summit objectives. USAID's priorities in the LAC region -- encouraging broad-based economic growth, building democracy, reducing population growth and improving health, and protecting the environment -- directly address these objectives.
ACHIEVING RESULTS
Population and Health. Over the past three decades, the United States has invested substantial resources to improve population, health and nutrition conditions in the Americas. These investments are paying off. During that period the region's birth rate declined 33%, from 33.8 per 1,000 population in 1950-1955 to an estimated 21.9 per 1,000 population in 1990-1995. USAID population programs helped reduce fertility rates in Mexico from 6.7 children per woman in 1970 to 3.2 in 1990. Fertility rates for the LAC region are estimated to have dropped by 10% in the past decade from 3.64 in 1980-1985 to 3.26 in 1990-1995. The largest declines have been in women over 30 years of age. Infant mortality rates have fallen from 125 per 1,000 live births in 1959 to 47 per 1,000 live births in 1994. Despite this progress, 600,000 children in the region still die before their first birthday, most from causes which could be prevented through simple, low-cost treatments.
There is substantial work still to be done in reproductive health, especially in reducing maternal mortality and decreasing HIV transmission. In Bolivia, for example, 1 out of every 50 women is at risk of death during the course of her reproductive life as a result of complications of pregnancy and childbirth. Heterosexual transmission of HIV is now the predominant cause of infection in most LAC countries, and it is estimated that 1,000 new cases occur every day in the region--mostly undiagnosed, silent infections in individuals who unknowingly may continue to pass it on. The number of HIV infections in LAC is projected to climb to more than three million by the end of the decade.
Reproductive health activities are being expanded to link or integrate family planning with other high-priority activities, including prenatal and postnatal care, safe delivery, diagnosis and treatment of sexually transmitted diseases (STDS). LAC's approach to HIV/AIDS programming is being revised and updated to respond to transnational patterns of transmission, multi-country issues and changing transmission patterns within the region through policy dialogue, nongovernmental organization (NGO) strengthening, and condom social marketing for STD and HIV prevention. The LAC region has been the world leader in immunization programs with the recent certification that polio transmission has been ended only the latest example. Building on the success of polio elimination, measles now has been targeted for elimination by the year 2000.
Environment and Energy. In past years, USAID's environmental programs in LAC countries focused on "green" environmental issues--promoting sustainable agriculture, sustainable management and conservation of natural forests, and conserving biodiversity. Given the increasing impact of pollution due to rapid industrialization and urbanization, USAID is addressing "brown" issues, including conservation and sustainable energy management; urban and industrial pollution. Our assistance of governments in developing and implementing sound environmental regulations will not only improve the quality of life in LAC countries. It will enable them to meet the environmental standards which will be part of any Free Trade Area of the Americas. USAID's new $25 million Central America regional initiative will address biodiversity; sustainable energy production; and pollution prevention within Central America. USAID's $22.6 million Environmental Initiative for the Americas (EIA) also addresses these issues. The EIA supports pilot activities which improve pollution prevention, sustainable energy production, coastal zone management, and environmental regulation.
While increasing attention is given to urban and industrial pollution, the issues of forest and biodiversity conservation remain priorities for the LAC region.
Democracy and Human Rights (DHR). Impressive results have been achieved in the region in implementing U.S. objectives in the democracy and human rights area. Eleven LAC countries are strengthening local governance and municipal development with AID assistance. In Guatemala (1994) and Nicaragua (1995), new legislation haspermitted municipalities to tax land. Costa Rica and El Salvador are considering similar measures. USAID funding and technical assistance have been key to Bolivia's successful launch last year of its landmark Popular Participation Program, which many policy makers and specialists consider the most important political and socioeconomic event since the 1952 revolution. The program promotes municipal government effectiveness and increased allocation of resources from the central government to municipalities.
Eight LAC countries have adopted and implemented revised criminal procedures codes and are moving toward public trials and clear limits on pre-trial detentions. Six countries are improving election processes with our help, and half have training programs supporting civic education. USAID has helped Mexico, El Salvador, Bolivia, Panama and Haiti hold free and fair elections in the past two years.
Legislative modernization projects in Chile, Bolivia, Costa Rica, Honduras, El Salvador, Nicaragua and Haiti have increased legislators' and committees' access to non-partisan technical information; established budgetary oversight offices; improved bill drafting capacities; and encouraged reforms to promote legislative responsiveness to constituencies.
Broad Based Economic Growth. Growth rates in LAC are still not high enough to achieve major reductions in poverty or underemployment levels. Forty-five percent of the population lives below the poverty line, and growth during this decade has yet to overcome the income losses which increased poverty during the past decade.
To assist in the creation of a hemispheric free trade area, USAID helps these countries to deepen economic reforms, expand access and economic opportunity, and invest. Through a grant to the International Finance Corporation, the Government of Haiti is planning to privatize nine major public sector enterprises including the phone and electric companies and port facilities. In Bolivia, 18,400 permanent jobs were created under USAID's microenterprise and export promotion activities. In Peru, USAID supported, through the P.L. 480 Title III program, efforts to privatize agricultural marketing, research and extension. In El Salvador, USAID efforts helped non-traditional agricultural exports to grow by 19% annually. In Honduras, economic growth resulting from USAID-encouraged economic policy reforms led to an increase in U.S. exports to almost $900 million in 1993. Support for clearance of arrears led to the disbursement of credit to Haiti by major lending institutions. In a major breakthrough, Ecuador and the U.S. Government signed a bilateral intellectual property rights agreement. From 1987 to 1994, the exports generated by 421 Central American businesses receiving technical assistance increased from $250,000 to over $36 million. More than 4.5 million new textbooks have been delivered to the Ministry of Education in Nicaragua, 40 technicians were trained in curriculum development, and 500 master teachers have been trained. They, in turn, will train 13,000 teachers for grades 1-4 over the next few years.
At the Central American regional level, USAID has assisted the strengthening of the region's intellectual property rights regime and is completing a regional study on labor which will contribute to improved labor and management relations and adherence to international standards on workers rights. At the hemispheric-wide level, a grant has been made to ACCION International to assist its affiliate financial institutions to access commercial sources of capital. Finally, the LAC regional program has initiated a series of seminars being held in major cities throughout the United States that are bringing together business and government to address issues and opportunities related to the emerging electronic commerce and trade infrastructure to reduce transactions cost and to facilitate increases in trade.
MANAGEMENT CHALLENGES
The Development Challenge. At the summit of the Americas the region's democracies established a Partnership for Development and Prosperity that offers a vision for the future reflecting fundamental U.S. national interests. The challenges are to: preserve and strengthen the community of democracies in the Americas; promote prosperity through economic integration and free trade; eradicate poverty and discrimination in the hemisphere; guarantee sustainable development; and conserve the natural environment for future generations. In this context, an essential task is to increase opportunities for the poor to participate in economic growth. If these challenges are successfully met, jobs for U.S. workers will be created and illegal immigration to the United States will be reduced.
The challenge for USAID is to achieve these objectives with limited resources. The USAID strategy of advancing broad-based economic growth, building democracy, stabilizing population growth, and protecting the environmentand natural resource base is most effective through progress in each of these mutually inter-dependent and reinforcing areas. Therefore, the assistance strategy for the LAC region places major emphasis on the need for full sustainable development programs that address the connections linking each of strategic areas.
Resource Allocation. Resource allocations in the LAC region reflect U.S. national interests, program performance and overall country development performance. Resources are allocated to core sustainable development countries (Haiti, El Salvador, Nicaragua, Bolivia, Peru, Guatemala, Honduras, Jamaica, Ecuador, Paraguay, Guyana and the Dominican Republic) to achieve strategic objectives in economic growth, environment, democracy, and population and health. Three of the four other sustainable development programs focus on specific global concerns, such as environment, AIDS, and population growth. The fourth program, Panama, addresses a major U.S. interest, the successful implementation of the Panama Canal Treaty. A very modest level of funding will support a program of information dissemination in Cuba to support the re-emergence of civil society in country. Through more precisely defined, programmatic focus and management efficiencies, LAC programs will be implemented with declining staff levels in the field and in Washington.
LAC programs are primarily financed through Development Assistance. However, P.L. 480 resources are utilized to support the sustainable development programs in Bolivia, Haiti, Nicaragua, Honduras, Guatemala and Peru. The Haiti program and part of the El Salvador, Guatemala, Nicaragua and LAC regional programs are financed with Economic Support Funds. Alternative Development programs in Peru and Bolivia are partially financed with International Narcotics funds.
Mission Phaseout. Development progress has been sufficiently great in eleven LAC countries that our programs were closed in FY 1995, or will be closed before the end of FY 1996. These graduate countries include Costa Rica, Chile, Argentina, Belize, Uruguay and the six nations of the eastern Caribbean (Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Lucia and St. Vincent and the Grenadines)..
FY 1997 PROGRAM
Building Democracy
The LAC region has witnessed dramatic movement in the past two decades toward civilian, representative rule, but the region still faces daunting challenges of democratic institutionalization. Deepening democracy through improved public responsiveness to a mandate rooted in the popular will is necessary to counteract limited participation, narco-
corruption, impunity, centralized bureaucracies and inefficiency--all of which undermine the rule of law and threaten basic human rights. Democracy is the centerpiece of USAID's strategic thrust in the region. In democratic stability lie the seeds of success for all areas of development, including economic and trade expansion, equitable social development, and peaceful resolution of both local and transnational problems. USAID has long supported greater adherence to internationally recognized human rights, more active involvement by citizens in the process of governance, and the reform of government institutions to be more transparent, accountable, effective, decentralized, and accessible to the people. USAID's democracy program focus has been evolving from an emphasis on rule of law, judicial reform and improved administrative efficiency to include more efforts to build civil society, decentralize political and financial decision-making, and open up government institutions to public scrutiny.
Free and fair elections and human rights are supported throughout the region. The past year brought free and fair presidential elections to Argentina, Peru, Guatemala and Haiti, as well as the elimination of all LAC countries but Cuba from Freedom House's "not free" index. Eight LAC countries have moved from revised criminal codes toward public trials, pre-trial detention reforms, and alternative dispute-resolution mechanisms. A dynamic network of leading Latin NGOs has linked with Partners of the Americas to promote greater civil society involvement in democracy. Criminal prosecution of public sector and military officials in Bolivia and Honduras of historic importance.
In FY 1997, significant new USAID initiatives in the Dominican Republic will promote popular participation in national dialogue along with structural reforms and decentralization. Judicial reform to promote the rule of law and increased public accountability also will be funded. Elsewhere in the region, USAID will continue funding the consolidation of democracy, especially the recent democratic transitions in Haiti, Paraguay, Peru, and Nicaragua. Programs in these and other USAID countries will support human rights, the rule of law, greater citizen participation, central government transparency and accountability, and decentralization of power to local and municipal entities.
Economic Growth
During the past decade, the countries of the region have made great progress in restructuring their economies, restoring macroeconomic stability, and removing policy impediments to broad-based participation. Wide income inequality remains the most serious problem in the region, a brake on economic growth, and a source of political instability. In a number of the larger countries, this situation has worsened over the past two decades. However, in a sample of seven countries in which USAID has worked on sustainable development problems over the entire period, six showed an improvement in both overall growth and in the income share of the bottom 20% of households. Policy dialogue to eliminate barriers to the poor, development of institutions to open up opportunity, and basic education for all have produced the desired result. Enhancing market access for small-scale entrepreneurs has a major potential for broadening economic growth and alleviating inequality in the region. Market access activities, including support for microenterprise, are supported by USAID in all sustainable development countries. Access to credit and other financial services through appropriate self-sustaining institutions is supported in each country. Programs to enhance access to land ownership, especially in Central America, in support of policy reforms which advance privatization and assure competition and to provide basic infrastructure and services in poor rural regions are supported in ten bilateral missions and regional programs.
In Honduras, the government issued 9,458 land titles, 25% to women. More than 140,000 households received financial services through USAID-supported microfinance activities in Bolivia.
USAID will finance the development of non-bank financial intermediaries to deliver financial services to small borrowers and savers in Haiti and to provide $11 million in credit for microenterprises and small farmers. USAID also will provide non-financial assistance to Haitian microenterprise to develop domestic and international markets and to improve the enabling environment in the sector. In the Dominican Republic, NGO-led economic policy analysis and public debate are producing an improved enabling environment to permit enhanced economic participation by the poor in the economic life of the country.
As economic integration in the hemisphere continues under the Summit of the Americas initiative, economic growth in each of the USAID-designated sustainable development countries will be increasingly tied to the trade-creating regional groupings to which they belong. Assistance to the countries of the region will be essential to enable them to harmonize policies and assure that regional trade agreements expand trade and do not produce trade distortions. Within countries, USAID supports increased non-traditional exports as well as trade policy reform.
Stabilizing Population Growth.
In the last 30 years in LAC, the infant mortality rate has fallen 59%, death among children under five has fallen 65%, and life expectancy at birth has increased by 11 years. While this progress is substantial, nearly 600,000 girls and boys in LAC younger than five years old die unnecessarily every year from diseases which are easily prevented. While better than the developing world average, this is still almost five times the rate in the developed world. The total fertility rate in LAC decreased from 4.1 to 3.1 during the period 1985-1995. While declines have been steep for other age groups, fertility among women under 20 has remained constant during this period (about 11% of all births), showing a need for continued improvements in family planning services. Policy and management decisions do not foster adequate attention to services with the greatest health and fertility impact. This leaves many people without access to the basic care they need. Delivery is inefficient in many of the LAC countries.
The heads of state endorsed two critical concepts in the Summit of the Americas plan of action: equitable access to a basic package of health services; and reforms in management and financing to assure such access. USAID's strategy for population and health emphasizes high-impact, lower-cost basic services, such as child survival, maternal health, family planning, sexually transmitted diseases and HIV/AIDS. Access to and impact of such services will be improved where current availability is poor, as in Haiti, Guatemala, and Bolivia. In countries where access is better, such as Ecuador and Jamaica, sustainability and quality of such services will be improved.
To stabilize population and improve health services in the region, USAID programs:
1. Reduce Morbidity and Mortality. Under-five deaths through child survival activities, including vaccinations, oral rehydration therapy, nutrition, and acute respiratory infection treatment; Maternal mortality is reduced and women'shealth is improved by controlling sexually transmitted diseases and HIV by increasing access to and use of condoms and supporting communications to promote safer and more responsible sexual behavior.
2. Strengthen and Sustain Health Systems. Population and health programs support policy reforms and improved management and financing systems in the context of a public-private health care market. USAID encourages governments to allocate resources more cost-effectively, to decentralize population and health services, to recover and contain costs, and to encourage an appropriate service delivery mix by government, NGO and for-profit providers.
3. Reduce Unwanted Fertility. Access to a variety of modern contraceptive methods is increased through voluntary family planning services; sustainable clinical, community, and commercial delivery systems in public, non-profit, and for-profit sectors are built. Where contraceptive use is higher, sustainability of the programs is improved; where it is lower, access to services is increased.
In Haiti, infant mortality has been reduced by 25%, from 101 to 74 deaths per 1,000 births, primarily due to reductions in neonatal tetanus. Measles cases in the Americas have decreased from over 200,000 in 1990 to only 2,471 in 1994--a 99% drop--due to higher initial vaccinations, combined with campaigns to re-vaccinate all children 9 months to 14 years of age. In Peru, vaccination coverage has increased to 97%, a remarkable achievement even by U.S. standards. Contraceptive prevalence increased in Bolivia from 12% in 1989 to 18% in 1994 after only 5 years of program assistance from USAID. Another 24% of women want contraception but do not yet have services.
In FY 97, USAID will initiate an important new population and health activity in the Central American Region. We will promote the development and evaluation of service delivery models which integrate training, supervision, management, logistics systems, and monitoring and evaluation systems. The integrated model is expected to result in fewer missed opportunities to provide preventive services (e.g., family planning or vaccinations), facilitate financial cross-subsidies, and permit cost sharing for logistics and management systems.
Protecting the Environment.
Environmental conditions in the LAC region present significant challenges and opportunities for the United States. The region is endowed with a rich natural resource base that includes fertile soils, extensive marine and freshwater systems, and more than half of the globe's remaining tropical forests and biodiversity. The region also is going through rapid industrialization and has one of the fastest rates of urbanization in the developing world. Unfortunately, the region's cities lack adequate infrastructure for sewage treatment, provision of potable water, and solid waste disposal; industries lack technologies for pollution prevention; and the rates of deforestation and agricultural land degradation are among the highest in the world. While rapid economic growth offers many opportunities for the United States, environmental degradation contributes prominently to such global problems as loss of biological diversity and global climate change, and the urban squalor and deterioration of the natural resource base contribute to poverty and political instability. For the United States, the results include increased immigration pressures, higher imported food prices, and greater transmission of communicable diseases.
Given the region's increasing pollution problems, USAID has expanded from its traditional focus on forestry, agriculture, and biodiversity-related environmental issues to address urban and industrial issues. USAID's new $25 million program in support of CONCAUSA is an excellent example of this approach. CONCAUSA, the partnership signed at the Summit of the Americas, committed the United States to work with the countries of Central America on three broad environmental issues: conservation of biodiversity, sustainable energy production, and pollution prevention. The program's staff and financial resources come from all Central American USAID missions and governments, relevant U.S. federal agencies such as the Environmental Protection Agency and Department of Energy, and local and U.S. NGOs.
USAID's $22.6 million Environmental Initiative for the Americas (EIA) is another example of the expanded scope of environmental activities. Funds under EIA in F 1995 supported Mission-proposed pilot activities designed to catalyze increased mission involvement in pollution prevention, sustainable energy production, coastal zone management, and environmental issues related to increased trade.
Forest and biodiversity conservation remain priorities. Through the LAC regional Parks in Peril (PiP) program implemented by The Nature Conservancy, USAID has helped protect 28 parks covering 13 million acres in 12 LACcountries. The program has proven to be one of the most successful and innovative biodiversity conservation programs in the world. USAID also helps maintain the productivity of natural resources, particularly for agriculture. In Honduras, USAID is helping to transform destructive hillside agriculture practices and to provide farm families with land-use technologies that decrease erosion and increase crop yields. The number of poor hillside-farming households adopting sound cultivation practices in this program's area doubled to more than 21,000, and annual soil erosion has been reduced by 70,000 tons.
F 1997 activities are being designed to follow up on the strong USAID pollution prevention and natural resource management activities in the region. Continued emphasis will be placed on the policy reforms, institutional strengthening, and information transfer that will both address the region's environmental problems and create a demand for U.S. technologies.
Providing Humanitarian Assistance.
Food insecurity, a chronic problem in the LAC region, is of concern to the United States for strategic and humanitarian reasons. Food insecurity contributes to low and inequitable growth, exacerbates environmental degradation, creates disincentives for population planning, stimulates migration, and encourages political instability. The continued presence of food insecurity in the region, therefore, will make it more difficult to achieve key U.S. objectives in economic growth, population and health, democracy and the environment. Food insecurity and hemispheric integration also are linked. If food insecure countries use food shortages as a rationale for reimposing controls on their agricultural sectors, progress toward hemispheric integration will be impeded.
Seven of the LAC sustainable development countries are food insecure due to food gaps at the national level. At the household level, the problem of food insecurity is even more serious, as poverty and highly skewed income distributions leave poor households with less access to calorie supplies than even these national averages suggest. The high levels of chronic malnutrition among children in many LAC countries are another indication of the seriousness of the food security problem in the region. Lack of access to health services and water and sanitation facilities also contribute to the malnutrition problem.
The USAID program in the LAC region is designed to deal with the problem of food insecurity through its economic growth and health strategic objectives. The USAID economic program focuses on encouraging broad-based economic growth because this is the most potent remedy for poverty, the root cause of food insecurity in the LAC countries. Fighting poverty, however, takes time. In the short-run, there are many food insecure families. Hunger is a problem that needs immediate attention. Targeted food assistance and primary health service delivery programs are used to reduce the present impact of hunger on the most vulnerable populations.
Food aid has been an important resource in the LAC region. Both P.L.480 Title II and Title III resources have played a valuable role. Title II provides food directly to some of the most vulnerable households and Title III encourages governments to remove some of the policy constraints to improved food security in the agricultural and health sectors. Both Title II and III resources also have been used to support economic development projects. To enhance the impact of the Title II programs, many missions and their cooperating sponsors are targeting resources to the poorest and most food insecure areas and to activities designed to increase the productivity and incomes of poor rural households and the health and nutrition of food insecure households more generally.
Title II local currency resources and food for work are being used to improve the economic opportunities and access of the rural poor in Bolivia, Guatemala, Honduras and Peru. Activities being supported include agricultural extension and marketing services and the development of productive infrastructure in rural areas, including building market access roads, recovering eroded land through soil conservation and forestry activities, and building small irrigation systems and improving irrigation. These agricultural productivity enhancement activities have increased the incomes and improved the food security of hundreds of thousands of some of the poorest rural households in the region. Title II food has been used in school feeding programs in Haiti, Honduras and Bolivia to improve learning and to reduce drop-out rates in primary schools.
Title II food also is being used to support mission health objectives in Bolivia, Guatemala, Haiti, Honduras, Nicaragua and Peru. Food and monetized resources are used to complement other key child survival services such as oral rehydration therapy, immunizations, and health and nutrition education to reduce the prevalence of chronic malnutritionamong children under five years of age. Food for work also is used in some countries to expand the access of poor people to water and sanitation services and to reduce the incidence of water borne diseases.