Remarks by Asst. Administrator Adolfo A. Franco, Bureau for Latin America and the Caribbean

from US Agency for International Development
Published on 29 May 2003
I was very pleased when I heard we were organizing this event. Central America has been and remains an area of great importance for the United States. We all know the history-after the destabilizing wars of the 1980s, the region has a new generation of democratic leaders who are well on their way, despite the region's many challenges, to helping these countries fulfill their promise.

President Bush affirmed his support for the countries of Central America when he met with five Central American presidents on April 10 of this year. The President stressed U.S. dedication to greater regionalization and economic integration, represented by strong U.S. commitment for the Central American Free Trade Agreement, or CAFTA.

USAID Administrator Andrew Natsios shares the President's vision for a Central America increasingly linked economically to the United States, and during my tenure as Assistant Administrator for Latin America and the Caribbean here at USAID, I have been impressed by the energy and honesty of leaders like President Flores of El Salvador, and President Bolaños of Nicaragua.

We at USAID have been for many years an integral part of the U.S. Government's overall engagement in Central America, from disaster relief--which I will discuss in a moment--to support for democracy and judicial reform projects, anti-corruption measures, and moves to strengthen regional cooperation.

All of us know that Hurricanes Mitch and Georges in 1998 combined to cause one of the most devastating natural disasters ever seen in the hemisphere. These killer storms left 19,000 people dead or missing, three million displaced, and caused $8.5 billion in damages. The destruction of crops, homes and infrastructure was unprecedented - and could easily have undone many decades of progress.

From the very first days, the United States, through USAID, the U.S. Department of Agriculture, and our military provided a massive emergency response. In just a few months, more than $300 million in assistance was delivered to victims in the largest airlift in history from the continental United States.

USAID led this entire process, coordinating with twelve other U.S. Government agencies. Through tremendous effort and dedication, this program put Central America back on the path to progress.

I know many of those present worked on the reconstruction program. As a commemoration of the U.S. response, and in an effort to document the success of this tremendous effort, USAID has prepared a brochure, "Mission Accomplished," which I would like formally to launch now and which I understand has been sent to many of you already. I hope each of you will take the opportunity to read about our collective accomplishments and to share this with others.

As important as our response to these natural disasters was, USAID's support for Central America did not stop with the successful completion of the Hurricane Mitch program.

Earthquakes in El Salvador and more hurricanes followed Hurricanes Mitch and Georges. Irregular rainfall then led to drought conditions which affected Honduras, Nicaragua, El Salvador, and Guatemala and reduced domestic food production. This, in turn has led to increased incidence of malnutrition, especially among children. An economic downturn due to record low international coffee prices has also put great strain on small farmers and the landless poor.

USAID responded to these new challenges with increased emergency food aid for Central America. We reoriented many of our health and economic growth programs to address the needs of those most vulnerable.

In all, USAID provided over $200 million to the Central American countries in 2001 through a combination of development assistance, emergency relief, and earthquake reconstruction programs. In 2002, total USAID assistance increased to $245 million.

In late 2002, USAID began a new initiative, the Opportunity Alliance for Central America. The Opportunity Alliance augments existing regional and bilateral programs to build trade capacity among the Central American countries and to help these countries prepare for the U.S. - Central America Free Trade Agreement (CAFTA) now being negotiated.

The Opportunity Alliance also supports public and private partnerships and seeks to make businesses more competitive. For example, in August 2002 USAID launched an $8 million program under the Opportunity Alliance to assist small and medium coffee producers in the region improve coffee quality, form new business linkages, secure longer-term contracts with the specialty coffee industry, and identify and implement diversification options for producers who cannot compete.

Finally, President Bush, Secretary Powell and Administrator Natsios have said free trade produces the sustained economic growth which is the engine of true economic development. That is why the Opportunity Alliance contains a large component for trade capacity building. USAID is working closely with the office of the U.S. Trade Representative, the Department of State, and the countries in Central America to help ensure the successful negotiation of a CAFTA agreement by the President's stated deadline of December, 2003, and we are working to make sure countries in the region have the capacity to implement an agreement once signed. We see the CAFTA process as integral to the President's larger goal of a Free Trade Area of the Americas by 2005. Let me close here. I look forward to hearing the remarks of the other panelists and to a good discussion of these issues.

Thank you.

USAID Information Center
Washington, DC