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U.S. Strategy for Engagement in Central America: Summary

Introduction

Central America, particularly the "Northern Triangle" countries of El Salvador, Guatemala, and Honduras, faces significant challenges, including widespread insecurity, weak political and judicial systems, and high levels of poverty and unemployment. These issues have had far-reaching implications for U.S. policy, as transnational criminal organizations use the region as a corridor for drug trafficking, especially cocaine, which accounts for about 90% of the cocaine entering the U.S. Additionally, Central America has become a major source of mixed migration flows, with many asylum seekers and economic migrants heading to the U.S. In FY2017, nearly 163,000 unauthorized migrants from the Northern Triangle were apprehended at the U.S. Southwest border, with over 63% being unaccompanied children or families.

The Obama Administration recognized the strategic importance of the region and launched a comprehensive U.S. Strategy for Engagement in Central America, increasing foreign aid to over $753.7 million in FY2016. However, the Trump Administration has sought to reduce U.S. assistance, proposing significant cuts to the strategy. Congress has largely rejected these cuts, maintaining funding levels at around $699.7 million for FY2017 and $626.5 million for FY2018.

Funding Overview

Since FY2016, Congress has appropriated an estimated $2.1 billion for the U.S. Strategy for Engagement in Central America. The funding is split roughly evenly between traditional development programs and security and rule-of-law initiatives. Specifically:

• 41% of the aid went to the Northern Triangle countries (El Salvador, Guatemala, Honduras).
• 3% was allocated to Belize, Costa Rica, Nicaragua, and Panama.
• The remaining 56% was directed to regional programs, such as the Central America Regional Security Initiative (CARSI).

The Trump Administration's FY2019 budget request sought to reduce assistance by 30% compared to FY2018, with the following allocations:

• $435.5 million for the Central America strategy.
• $45.7 million for El Salvador (-21%).
• $69.4 million for Guatemala (-42%).
• $65.8 million for Honduras (-18%).
• $1.8 million for other countries (-91%).
• $252.8 million for CARSI (-21%).

Despite these cuts, the remaining aid would shift focus toward security and rule-of-law efforts, reducing support for governance and economic growth programs.

Conditions on Assistance

Congress has imposed strict conditions on U.S. aid to the Northern Triangle to ensure effective use of funds and promote political will in the region. These conditions include:

• 25% of assistance must be withheld until the Secretary of State certifies that the governments are:

  • Informing citizens of the dangers of irregular migration.
  • Combating human smuggling and trafficking.
  • Improving border security.
  • Cooperating with the U.S. on the reintegration of repatriated citizens who do not qualify for asylum.

• 50% of assistance must be withheld until the Secretary of State certifies that the governments are addressing 12 other concerns, including:

  • Combating corruption.
  • Countering gangs and organized crime.
  • Increasing government revenues.
  • Reducing poverty and promoting equitable growth.
  • Protecting the rights of journalists, political opposition, and human rights defenders.

The State Department certified that all three countries met the first set of conditions in FY2016 and FY2017, but has only issued certification for the first set for FY2018, not the second.

Regional Developments

The Northern Triangle countries have implemented the Plan of the Alliance for Prosperity, which aims to address the root causes of emigration through economic development, improved public safety, and stronger institutions. With U.S. support, these countries have made tentative progress in recent years, including:

• Economic reforms and improved international economic conditions.
• Security improvements, with homicide rates declining in all three countries from 2014 to 2017, though they remain among the highest in the world.
• Governance efforts, including investigations into high-level corruption by the attorneys general of El Salvador, Guatemala, and Honduras, supported by international bodies like CICIG and MACCIH.

However, democratic backsliding and setbacks in governance have occurred, with reports from Freedom House indicating erosion of political rights and civil liberties in all three countries.

Policy Considerations

As Congress evaluates U.S. policy in Central America, key considerations include:

• Assessment of regional conditions: How have the challenges in Central America evolved since the U.S. Strategy was launched? What level of aid and over what timeframe would be necessary to bring about meaningful change?
• Impact of aid cuts: What are the potential consequences of reducing U.S. assistance on regional stability, security, and development? Which programs should be prioritized if aid is reduced?
• Effect of Trump's immigration policies: How have these policies influenced irregular migration from the region? What are the implications for U.S. objectives in Central America?

For further analysis, refer to CRS Report R44812.

Conclusion

The U.S. Strategy for Engagement in Central America reflects a long-term commitment to addressing the root causes of instability in the region. While there have been some improvements in security and governance, significant challenges remain. The strategy has faced political and budgetary fluctuations, with the Trump Administration proposing substantial cuts that have been partially rejected by Congress. The future of U.S. engagement in Central America will depend on continued congressional support and the effectiveness of regional initiatives in improving living conditions and security.