Caribbean-U.S. Relations: Issues in the 110th Congress
Issues in the 110 Congress
August 31, 2007
Mark P. Sullivan
Specialist in Latin American Affairs
Foreign Affairs, Defense, and Trade Division
Caribbean-U.S. Relations: Issues in the 110 Congress
With some 42 million people encompassing 16 independent countries and 13
overseas territories, the Caribbean is a diverse region that includes some of the
hemisphere’s richest and poorest nations. The region consists of 13 island countries,
from the Bahamas in the north to Trinidad and Tobago in the south; Belize, which
is geographically located in Central America; and the two countries of Guyana and
Suriname, located on the north central coast of South America. With the exception
of Cuba and Haiti, regular elections in the region are the norm, and for the most part
have been free and fair. Nevertheless, while many Caribbean nations have long
democratic traditions, they are not immune to threats to their political stability,
including terrorism. Many nations in the region experienced economic decline in
2001-2002 due to downturns in the tourism and agriculture sectors, but most
Caribbean economies have rebounded since 2003.
U.S. interests in the Caribbean are diverse, and include economic, political, and
security concerns. The Bush Administration describes the Caribbean as America’s
“third border,” with events in the region having a direct impact on the homeland
security of the United States.
The U.S.-Caribbean relationship is characterized by extensive economic
linkages, cooperation on counternarcotics and security, and a sizeable U.S. foreign
assistance program. U.S. aid supports a variety of projects to strengthen democracy,
promote economic growth and development, alleviate poverty, and combat the
HIV/AIDS epidemic in the region. The United States has offered preferential
treatment for Caribbean imports since 1984 under the Caribbean Basin Initiative yet
the performance of the region’s exports to the United States has been mixed. During
a June 2007 meeting in Washington, DC, Caribbean leaders and President Bush
pledged to strengthen existing trade arrangements. President Bush vowed to work
with Congress to extend and update the Caribbean Basin Trade Partnership Act,
which provides NAFTA-like tariff treatment for Caribbean imports, before it expires
at the end of September 2008. Despite close U.S. relations with most Caribbean
nations, there has been tension at times in relations. Many Caribbean nations resent
U.S. expressions of concern about their relations with Cuba and Venezuela. Another
delicate issue has been the large number of deportations from the United States to the
region over the past several years.
This report, which will be updated periodically, deals with broad issues in U.S.
relations with the Caribbean, including foreign assistance; counternarcotics and
security cooperation; support to combat the HIV/AIDS epidemic; trade policy; the
deportation issue; and energy issues. It does not include an extensive discussion of
Cuba, the Dominican Republic, or Haiti, which are covered in other CRS reports.
Additional CRS reports on the Caribbean region include CRS Report RL33951, U.S.
Trade Policy and the Caribbean: From Trade Preferences to Free Trade
Agreements, and CRS Report RL32001, HIV/AIDS in the Caribbean and Central
Introduction to the Caribbean Region..................................1
Economic and Social Development............................2
Most Recent Developments..........................................9
Regional and U.S. Policy Developments............................9
Issues in Caribbean-U.S. Relations...................................11
U.S. Foreign Assistance........................................12
HIV/AIDS in the Caribbean.................................14
Millennium Challenge Account..............................15
Article 98 Agreements and Sanctions on U.S. Aid...............16
Hurricane Recovery and Reconstruction Assistance in 2004.......16
Drug Trafficking and Money Laundering Issues.....................17
Tax Haven Issue..............................................20
Internet Gambling Issue........................................21
U.S. Trade Policy.............................................22
Movement Toward Free Trade..............................23
Third Border Initiative and Security Issues.........................27
U.S. Passport Requirements.................................29
Caribbean Energy Security......................................35
Legislative Initiatives in the 110th Congress............................37
Caribbean-American Heritage Month.........................37
Health and HIV/AIDS.....................................37
For Additional Reading............................................38
List of Figures
Figure 1. Map of the Caribbean Region.................................5
Table 1. Caribbean Region: Independent Countries and Territories...........6
Table 2. Caribbean Countries: Basic Facts.............................7
Table 3. Caribbean Leaders and Elections..............................8
Table 4. Total U.S. Foreign Assistance to the Caribbean, FY2003-FY2008...13
Table 5. U.S. HIV/AIDS Assistance to the Caribbean: FY2003-FY2008.....15
Table 6. U.S. Imports from Caribbean Countries........................25
Table 7. U.S. Exports to Caribbean Countries..........................26
Table 8. U.S. Deportations to the Caribbean, FY2005-FY2007.............34
Issues in the 110 Congress
Introduction to the Caribbean Region
The Caribbean, encompassing 16 independent nations and 13 overseas
territories, is a region of almost 42 million people that includes some of the
hemisphere’s richest and poorest nations. Although many of these nations have
similar characteristics, the region as a whole is more commonly distinguished for its
diversity. The region consists of 13 island nations from the Bahamas in the north to
Trinidad and Tobago in the south; Belize, which is geographically located in Central
America; and the two nations of Guyana and Suriname, located on the north central
coast of South America. The largest nations in terms of land area are Guyana and
Suriname, while those with the largest populations are Cuba, the Dominican
Republic, and Haiti. The island nations of the Eastern Caribbean are among the
smallest countries in the world. (See Tables 1 and 2 and Figure 1.)
Ethnically, a majority of the regional’s population is of African heritage,
descendants of slaves brought to the West Indies in the 17th to 19th centuries to work
on sugar plantations. Three nations — Guyana, Trinidad and Tobago, and Suriname
— have large populations of East Indian heritage, descendants of indentured servants
who were brought to the West Indies in the 19th and early 20th centuries. Small
minorities of ethnic Chinese are also found in several Caribbean nations and a
Javanese population is found in Suriname. Both Cuba and the Dominican Republic
have large populations of Spanish descent, but in both countries, people of mixed
African-Spanish heritage make up the majority of the population. Descendants of
indigenous Caribbean peoples, the Arawak and Carib Indians, constitute small
minorities in several Caribbean island nations, while Guyana and Suriname have
minorities of several Amerindian tribes. Belize, in addition to having a small
Garifuna (mixed African and Amerindian heritage) population, also has a significant
indigenous Mayan population.
Many countries in the region share a common British colonial heritage, while
Cuba and the Dominican Republic were Spanish colonies, Haiti was French, and
Suriname was Dutch. Stemming from its diverse colonial history, the region includes
12 predominantly English-speaking nations. In several nations, however, more than
one language is spoken, and in several countries, a common patois or dialect is
spoken. Haiti has two official languages: Creole, the common language spoken by
most of the population; and French, which is spoken only by about 10% of the
population. In several of the English-speaking Caribbean nations, a French patois is
also spoken, evidence of a historical era when British and France vied for colonial
control in the region.
Political Development. Politically, all Caribbean nations, with the exception
of communist Cuba, have elected democratic governments. Although Haiti and theth
Dominican Republic achieved independence in the 19 century and Cuba became
independent in 1902, the remaining Caribbean nations did not gain full politicalth
independence until the second half of the 20 century. Four of these gained
independence in the 1960s, six in the 1970s, and three in the 1980s, with St. Kitts and
Nevis the most recent in 1983. Most of the former British colonies have
parliamentary forms of government. Guyana, the Dominican Republic, Haiti, and
Suriname are republics headed by presidents. As noted above, the region also
includes 13 overseas territories, consisting of six British, three French, two Dutch,
and two U.S. territories (see Table 1).
Regular free and fair elections have been the norm in most Caribbean nations
for many years, with the exception of Cuba and Haiti. In 2006, Haiti ultimately held
successful elections in February that had been postponed several times in 2005;
Guyana held successful elections in August without the political violence that some
observers had expected; and St. Lucia held successful elections in December that led
to a change in government. To date in 2007, the Bahamas held parliamentary
elections in early May that led to a change of government; Jamaica has elections
scheduled for September 3 (postponed from August 27 because of Hurricane Dean);
and elections in Trinidad and Tobago are due by October. (See Table 3 for a listing
of leaders and elections for head of government.)
Although many Caribbean nations have maintained long democratic traditions,
they are not immune from terrorist and other threats to their political stability. In
1981, the government of Eugenia Charles in Dominica was threatened by a bizarre
coup plot involving foreign mercenaries. Grenada, under the socialist-oriented
government of Maurice Bishop, experienced a break from the democratic norm after
it assumed power in a nearly bloodless coup in 1979 and installed a people’s
revolutionary government. After the violent overthrow and murder of Bishop in
1983, the United States intervened to restore order and end the Cuban presence on
the island. In 1990, the government of Trinidad and Tobago was endangered by a
coup attempt by a radical Muslim sect, the Afro-Trinidadian based Jamaat al
Muslimeen, led by Yasin Abu Bakr. In 1993, stability on St. Kitts was threatened
following violent protests after disputed elections; order was restored with the
assistance of security forces from neighboring states. More recently, in early June
2007, one Trinidadian and three Guyanese nationals were arrested in Trinidad and
Tobago in a foiled plot to blow up a fuel pipeline and tanks at New York’s John F.
Kennedy International Airport. A fourth suspect, a U.S. citizen of Guyanese origin,
was arrested in the United States. The plot focused U.S. and international attention
on the potential security threat of Muslim extremists from the Caribbean region.
Economic and Social Development. As noted above, the Caribbean region
is home to some of the richest and poorest nations in the hemisphere, with varying
levels of social development. Based on per capita income levels, the World Bank
categorizes two Caribbean countries — Antigua Barbuda and the Bahamas — as high
income, eight as upper middle income, five as lower middle income, and one — Haiti
— as low income. Most of the English-speaking countries have high literacy rates
and relatively low infant mortality rates. Haiti has the lowest adult literacy rate in the
Caribbean, estimated at 52%, and the highest infant morality rate, measured at 74 per
100,000 live births, while Cuba by far has the lowest infant mortality rate in the
region. The United Nations Development Program issues an annual report on human
development, with a composite human development index (HDI) that ranks countries
based on life expectancy, adult literacy, educational enrollment, and per capita
income. In 2006, based on their HDI rank, six Caribbean nations — Barbados, Cuba,
St. Kitts and Nevis, the Bahamas, Trinidad and Tobago, and Antigua and Barbuda
— were categorized as having “high development,” while nine others, ranging from
Dominica to Jamaica, were categorized as having “medium development.” The only
Caribbean nation ranked as having “low development” was Haiti.1
Many Caribbean nations experienced an economic slump in 2001-2002 due to
downturns in the tourism and agriculture sectors, although most economies in the
region have rebounded since 2003. In 2006, all Caribbean nations experienced
economic growth, with English-speaking nations and Suriname averaging 6.8%
growth for the year. Among the strongest Caribbean economic performers in 2006
were Trinidad and Tobago, with 12% growth, Antigua and Barbuda, with 11%
growth, and the Dominican Republic, with 10% growth. Grenada’s economy, which
experienced an economic decline of over 7% in 2004 because of the damage from
Hurricane Ivan, rebounded in 2005 and 2006, with growth rates of 13.2% and 7%
respectively. The weakest economic performers in recent years have been Guyana,
which experienced a 3% decline in 2005 because of high oil prices and floods, and
just a 1.3% increase in 2006; and Haiti, hard hit by floods in 2004 caused by Tropical
Storm Jeanne, which experienced a 3.5% economic decline in 2005, and only
experienced modest growth of 1.8% in 2005 and 2.5% in 2006.2
Regional Integration. In terms of regional integration, 14 of the region’s
independent nations belong to the Caribbean Community (CARICOM), with the
exception of the Dominican Republic (which has observer status) and Cuba.
CARICOM was formed in 1973 to spur regional integration.
CARICOM, which often has been criticized for acting too slowly, is trying to
prepare itself for hemispheric integration by moving ahead with its own regional
integration. In April 2005, CARICOM members established the Caribbean Court of
Justice (CCJ), headquartered in Port-of-Spain in Trinidad and Tobago, that will serve
as the region’s final court of appeal and replace the Privy Council based in London.
To date, however, only Barbados and Guyana have accepted the CCJ as their final
court of appeal.
In 2006, 12 out of 14 CARICOM nations signed an accord for a CARICOM
Single Market (CSM) to further the process of regional economic integration.
Eastern Caribbean nations were enticed to join in part by a decision to establish a
regional Development Fund and Development Agency for poorer or disadvantaged
countries. Under the accord, governments have agreed to provide for the free
movement of goods, services, capital, and labor. The goal is to have a CARICOM
1 For HDI rankings, see CRS Report RS22657, Latin America and the Caribbean: Fact
Sheet on Economic and Social Indicators, by Julissa Gomez-Granger.
2 U.N. Economic Commission for Latin America and the Caribbean (ECLAC), Preliminary
Overview of the Economies of Latin America and the Caribbean, December, 2006.
Single Market and Economy (CSME) by the end of 2008, which is to include a single
currency and the harmonization of economic policy. Some observers maintain that
while there has been some progress under the CSM, a number of governments are
lagging behind in facilitating the free movement of labor and capital.3 Trinidad and
Tobago’s Central Bank governor has pointed the difficulty of moving ahead with a
common monetary or macroeconomic policy given the differences in the region’s
The Cricket World Cup games held in nine Caribbean nations in March and
April 2007 — including Grenada, St. Vincent, and Trinidad and Tobago — spurred
some movement toward regional integration. In preparation for the event, CARICOM
established a travel and security initiative dubbed the Single Domestic Space,
allowing visitors to obtain one visa to travel to 10 English-speaking Caribbean
countries, with the need to pass through security checks only at their first point of
ent ry. 5
In addition to CARICOM, six Eastern Caribbean nations are members of the
Organization of Eastern Caribbean States (OECS), the subregional organization
designed to stimulate economic integration and foreign policy harmonization. The
six OECS nations also share a common currency, the Eastern Caribbean dollar, with
monetary policy managed by the Eastern Caribbean Central Bank. The Caribbean
Development Bank (CDB), headquartered in Barbados, promotes economic
development and regional integration.
3 “Jury Still Out on Caribbean Single Market,” BBC Monitoring Americas, February 3,
4 Economist Intelligence Unit (EIU), “Organisation of Eastern Caribbean States, Country
Report,” March 2007, p. 31.
5 “Cricket World Cup Boost Regional Integration,” Latin American Regional Report,
Caribbean & Central America, February 2007.
Figure 1. Map of the Caribbean Region
Table 1. Caribbean Region: Independent Countries and
Antigua and Barbuda a cDominican RepublicSt. Kitts and Nevis a c
Bahamas aGrenada a cSt. Lucia a c
Barbados aGuyana aSt. Vincent and the a c
Belize aHaiti aSuriname a
CubaJamaica aTrinidad and Tobago a
Dominica a c
Anguilla b dFrench Guiana
British Virgin Islands b dMartinique
Cayman Islands b
Turks and Caicos Islands b
Montserrat a c
ArubaU.S. Virgin Islands
Netherlands AntillesPuerto Rico
a. CARICOM full members
b. CARICOM associate members
c. OECS full member
d. OECS associate members
Table 2. Caribbean Countries: Basic Facts
Gr oss Adul t Inf a nt
National Li teracy Mortality
Area Population(GNI)Income(%ages 15(per 1,000
(sq.(2005,$ billions(U.S. $,and above,live births
Bahamas5,382323 — a9510
Barbados166270 — b10010
Belize 8,867 292 1,021 3,500 75.1 32
Cuba44,20011,269 — c99.8.6
Domi nica 290 72 .273 3,790 88.0 13
Domi nican 18,704 9,000 21.1 2,370 87.7 27
Grenada 133 107 .418 3,920 96.0 18
Guya na 82,980 751 .759 1,010 96.5 48
Haiti 10,714 9,000 3.9 450 52 74
J a ma ica 4,244 3,000 9.0 3,400 79.9 17
St. Kitts and10148.3948,21097.818
Suriname 63,037 449 1,140 2,540 89.6 30
Sources: Area statistics are drawn from the U.S. Department of State Background Notes for each
country; population and per capita income statistics are from the World Bank’s World Development
Report 2007; infant mortality rates and adult literacy rates are from the United Nations’ Human
Development Report 2006. Adult literacy rates for the Bahamas, Barbados, Haiti and Trinidad and
Tobago are from the UNESCO Institute for Statistics 2003.
a. Estimated by the World Bank to be $10,726 or more.
b. Estimated by the World Bank to be between $3,446 and $10,725.
c. Estimated by the World Bank to be between $876 and $3,465.
Table 3. Caribbean Leaders and Elections
CountryLeadershipLast ElectionNext Election
Antigua andPrime Minister Mar. 23, 2004 by Mar. 2009
BahamasPrime Minister Hubert Ingraham May 2, 2007by May 2012
BarbadosPrime Minister Owen Arthur May 21, 2003by May 2008
BelizePrime Minister Said Musa Mar. 5, 2003by Mar. 2008
CubaPresident Fidel Castro aa
DominicaPrime Minister Roosevelt Skerritt May 5, 2005by May 2010
DominicanPresident May 16, 2004May 2008
GrenadaPrime Minister Keith Mitchell Nov. 27, 2003by Nov. 2008
GuyanaPresident Jagdeo Bharrat Aug. 28, 2006by Dec. 2011
HaitiPresident Rene Préval Feb. 7, 2006 2011
JamaicaPrime Minister Portia Simpson MillerbOct. 2002Sept. 3, 2007
St. Kitts andPrime Minister Oct. 25, 2004by Oct. 2009
St. LuciaPrime Minister John Compton Dec. 2006by Dec. 2011
St. Vincent andPrime Minister Dec. 7, 2005by Mar. 2010
the GrenadinesRalph Gonsalves
SurinamePresident Ronald Venetiaan May 25, 2005May 2010
Trinidad andPrime Minister PatrickOct. 7, 2002by Oct. 2007
a. Castro has served as head of government since the 1959 Cuban Revolution. Since that time, there have been
no elections for head of government. Because of Fidel Castro’s poor health, his brother Raúl has been acting as
interim leader since late July 2006.
b. Portia Simpson Miller was sworn in as Prime Minister in March 30, 2006, after replacing out-going Prime
Minster P.J. Patterson as leader of the ruling People’s National Party.
Most Recent Developments
Regional and U.S. Policy Developments
!On September 3, 2007, Jamaica is scheduled to hold parliamentary
elections that were postponed from August 27 because of recovery
efforts after Hurricane Dean. The ruling People’s National Party
(PNP), headed by Prime Minister Portia Simpson Miller, is
competing against the opposition Jamaican Labour Party (JLP), led
by Bruce Golding, in a race that is expected to be close.
!From August 17-19, 2007, Hurricane Dean caused damage in
several Caribbean nations, with about a dozen deaths attributed to
the storm. In the eastern Caribbean, Dominica St. Lucia, and the
French islands of Guadeloupe and Martinique reported extensive
damage to the agricultural sectors. Jamaica was hard hit by the
storm, which caused flooding in several parishes, made many roads
impassable, caused power outages, and significantly damaged the
agricultural sector. U.S. Ambassador to Jamaica Brenda LaGrange
declared a disaster due to the hurricane, and the U.S. Agency for
International Development’s Office of Foreign Disaster Assistance
(USAID/OFDA) provided $125,000 for emergency relief supplies.
A USAID assessment team is determining whether Jamaica needs
!On June 19-21, 2007, the Caribbean Community (CARICOM) held
a conference in Washington D.C. in which Caribbean leaders held
meetings with President Bush and several Members of Congress,
and a series of meetings at the Inter-American Development Bank,
the Organization of American States, and the World Bank, with
forums for the diaspora, the private sector, and development experts.
A joint statement issued by President Bush and Caribbean leaders
pledged cooperation in several areas, including a strengthening of
existing trade arrangements. President Bush announced that he
would work with Congress to extend and update the Caribbean
Basin Trade Promotion Act (CBTPA). See the joint statement at
!On June 2, 2007, the Department of Justice announced that four
individuals — one U.S. citizen of Guyanese origin, two Guyanese
nationals, and one Trinidadian national — were being charged in a
plot to attack John F. Kennedy International airport by planting
explosives in the airport’s major jet-fuel supply tanks and pipeline.
The plot allegedly tapped into “an international network of Muslim
extremists from the United States, Guyana, and Trinidad and
Tobago.” The three foreign nationals were arrested in Trinidad and
!On June 9, 2007, the Departments of Homeland Security and State
announced that there would be some flexibility in the passport
requirement for U.S. citizens traveling by air to the Caribbean, as
well as Canada and Mexico, that went into effect on January 23,
2007. A backlog of passport applications resulted in a policy change
through the end of September 2007 whereby individuals who have
applied but have not yet received their passports are able to travel
with a government-issued photo and official proof of their passport
!On May 2, 2007, the Bahamas held parliamentary elections in which
the opposition conservative Free National Movement (FNM), led by
former Prime Minister Hubert Ingraham, defeated the ruling center-
left Progressive Liberal Party (PLP), led by Prime Minister Perry
Christie. The FNM captured 23 seats while the PLP won the
remaining 18 seats in the House of Assembly.
!On July 31, 2007, the House passed, by a vote of 371to 55, H.R.
176 (Lee), the Shirley A. Chisholm United States-Caribbean
Educational Exchange Act of 2007, which would authorize
assistance to the countries of the Caribbean to fund educational
development and exchange programs.
!On July 24, 2007, the House Western Hemisphere Subcommittee of
the Committee on Foreign Affairs held a hearing on U.S. deportees
in Latin America and the Caribbean.
!On June 18, 2007, the House passed H.Con.Res. 148 (Lee) by voice
vote, which recognizes the significance of National Caribbean-
American Heritage Month.
!On June 15, 2007, the House passed, by a vote of 379 to 25,
H.Amdt 291 to the FY2008 Department of Homeland Security
Appropriations Act, H.R. 2638, that would prohibit any funds in the
bill from implementing a passport requirement plan under section
7209 of the Intelligence Reform and Terrorism Prevention Act of
2007, with a provision that would delay the implementation of a
passport requirement plan to no earlier than June 1, 2009.
!On June 11, 2007, the House passed H.Res. 418 (Engel), by a vote
of 386-0, which recognizes and welcomes the delegation of
Presidents, Prime Ministers, and Foreign Ministers from the
Caribbean to Washington DC, and commends CARICOM for
holding the conference on the Caribbean.
Issues in Caribbean-U.S. Relations
U.S. interests in the Caribbean are diverse, and include economic, political, and
security concerns. During the Cold War, security concerns tended to eclipse other
policy interests, and focused on the potential threat in the region from the Soviet
Union and Cuba. In the aftermath of the Cold War, other U.S. policy interests
emerged from the shadow of the East-West conflict in the Caribbean and U.S. policy
priorities shifted from one emphasizing security concerns to a new focus on
strengthened economic relations through trade and investment. With the September
2001 terrorist attacks in the United States, security concerns have re-emerged as a
major U.S. interest in the Caribbean. The Administration describes the Caribbean
as America’s “third border,” with events in the region having a direct impact on the
homeland security of the United States. It describes Caribbean nations as “vital
partners on security, trade, health, the environment, education, regional democracy,
and other hemispheric issues.”6
The United States has close relations with most Caribbean nations, with the
exception of Cuba under Fidel Castro. The U.S.-Caribbean relationship is
characterized by extensive economic linkages, cooperation on counternarcotics
efforts and security, and a sizeable U.S. foreign assistance program supporting a
variety of projects to strengthen democracy, promote economic growth and
development, alleviate poverty, and combat the AIDS epidemic in the region. The
region has had preferential treatment of its exports to the U.S. market since the early
1980s, and U.S. efforts are now focused on helping the region prepare for
hemispheric free trade.
Despite close U.S. relations with most Caribbean nations, at times there has
been tension in the relationship. For example, relations between CARICOM nations
and the United States became strained in the aftermath of the departure of Haitian
President Jean Bertrand Aristide from power in February 2004. CARICOM nations
called for an investigation into the circumstances surrounding Aristide’s departure,
and Haiti’s participation in CARICOM was suspended. After Haiti held elections in
February 2006 leading to the inauguration of Rene Préval as president, CARICOM
subsequently reinstated Haiti’s participation in CARICOM at their July 2006 summit.
In another example, Caribbean nations generally maintain good relations with Cuba
and Venezuela, and resent U.S. expressions of concern about these relations. Many
Caribbean nations are participating in a Venezuelan program known as PetroCaribe
that offers oil on discounted terms depending on the price of oil.
6 U.S. Department of State, Congressional Budget Justification, Foreign Operations,
FY2006, “Third Border Initiative,” p. 548.
U.S. Foreign Assistance
The United States has provided considerable amounts of foreign assistance to
the Caribbean over the past 25 years. U.S. assistance to the region in the 1980s
amounted to about $3.2 billion, with most concentrated in Jamaica, the Dominican
Republic, and Haiti. An aid program for the Eastern Caribbean also provided
considerable assistance, especially in the aftermath of the 1983 U.S.-led military
intervention in Grenada. In the 1990s, U.S. assistance to Caribbean nations declined
to about $2 billion, or an annual average of $205 million. Haiti was the largest
regional recipient of assistance during this period, receiving about $1.1 billion in
assistance or 54% of the total. Jamaica was the second largest U.S. aid recipient in
the 1990s, receiving about $507 million, almost 25% of the total, while the
Dominican Republic received about $352 million, about 17% of the total. Eastern
Caribbean nations received about $178 million in assistance, almost 9% of the total.
The bulk of U.S. assistance was economic assistance, including Development
Assistance (DA), Economic Support Funds (ESF), and P.L. 480 food aid. Military
assistance to the region amounted to less than $60 million during the 1990s.
From FY2000 through FY2007, U.S. aid to the Caribbean region amounted to
about $1.9 billion, with increases reflecting increased HIV/AIDS assistance to the
region (especially to Guyana and Haiti), disaster and reconstruction assistance in the
aftermath of several hurricanes and tropical storms in 2004, and increased support
for Haiti following the departure of President Jean-Bertrand Aristide from power.
As in the 1990s, the bulk of assistance to the region consisted of economic assistance.
With regard to hurricane disaster assistance, Congress appropriated $100 million in
October 2004 in emergency assistance for Caribbean nations (P.L. 108-324), with
$42 million for Grenada, $38 million for Haiti, $18 million for Jamaica, and $2
million for other countries affected by the storms. Overall assistance to the
Caribbean amounted to $393 million in FY2005, $336 million in FY2006, and an
estimated $346 million in FY2007 (see Table 4).
For FY2008, the Bush Administration requested almost $367 million in
assistance for the Caribbean, with about 61% for Haiti, almost 13% for Cuba
democracy programs, almost 10% for the Dominican Republic, and just over 7% for
Guyana. The Caribbean regional program would be funded at $9.3 million, while
Eastern Caribbean nations would also receive about $3.2 million for a Peace Corps
program, $0.6 million for International Military and Training (IMET) assistance, $0.5
in counternarcotics assistance, and $0.5 million in anti-terrorism assistance (ATA).
While in past years, Caribbean nations have received some Foreign Military
Financing (FMF) — for example, almost $4 million in FY2006 — the
Administration did not request any FMF for Caribbean nations in FY2008. Funding
for the Third Border Initiative would decline, and has been subsumed into a Western
Hemisphere Program, with at least $1.750 million identified for the TBI in the State
Department’s FY2008 Congressional Budget Justification for Foreign Operations.
(Also see discussion below on “Third Border Initiative and Security Issues.”)
In the 110th Congress, the House passed H.R. 176 (Lee), the Shirley A.
Chisholm United States-Caribbean Educational Exchange Act of 2007, on July 31,
2007, by a vote of 371-55. The measure would authorize assistance to the countries
of the Caribbean to fund educational development and exchange programs.
Table 4. Total U.S. Foreign Assistance to the Caribbean,
(U.S. $ millions)
Country F Y 2003 F Y 2004 F Y 2005 F Y 2006 (estimate) ( request )
Bahama s 1.336 1.264 1.294 1.747 0.838 1.200
Belize 2.046 2.082 2.799 2.334 2.764 2.485
Cuba 6.000 21.369 8.928 10.894 13.300 45.700
Domi nican 28.099 33.968 28.652 28.229 35.038 34.646
Guya na 8.407 11.590 20.255 23.846 31.302 27.331
Haiti 71.887 132.324 182.717 225.738a 217.404 222.900
J a ma ica 22.337 24.186 22.459 17.580 15.532 13.654
Suriname 1.397 1.471 1.486 1.883 2.048 1.474
Trinidad and0.540 — 0.049.2341.3001.478
Caribbean 13.008 10.310 110.909 11.326 14.840 9.310
East er n b 4.255 6.900 4.958 5.136 4.958 4.804
Third Border 3.0004.9768.9282.9703.0001.750c
OAS Special — 4.971 — — — —
Mission in Haiti
Enduring — — — 3.9604.000 —
T otal 162.312 255.411 393.434 335.877 346.324 366.732
Source: U.S. Department of State, FY2004-FY2008 Congressional Budget Justifications for Foreign Operations.
FY2007 estimates were provided by the Department of State.
a. For FY2006, aid figures for Haiti include $20 million in FY2006 supplemental assistance.
b. The Eastern Caribbean category funds military assistance and Peace Corps programs for seven countries. Antigua and Barbuda,
Barbados, Dominica, Grenada, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines. Development assistance for these
nations is funded under USAID’s Caribbean Regional program.
c. For FY2008, the Third Border Initiative (TBI) is part of the Western Hemisphere Regional Program, with $1.750 million in ESF
designated to enhance diplomatic, economic, health, education, disaster preparedness, and law enforcement cooperation and
collaboration. In addition, an unspecified portion of $1.1 million for humanitarian assistance under the Western Hemisphere Regional
Program would support TBI activities that help Caribbean nations plan and prepare for natural disasters.
HIV/AIDS in the Caribbean.7 The AIDS epidemic in the Caribbean has
begun to have negative consequences for economic and social development in several
countries, and continued increases in HIV infection rates threaten future development
prospects. In contrast to other parts of Latin America, the mode of HIV transmission
in several Caribbean countries has been primarily through heterosexual contact,
making the disease difficult to contain because it affects the general population. The
countries with the highest prevalence or infection rates in the Caribbean are Belize,
the Bahamas, Guyana, Haiti, and Trinidad and Tobago, with rates between 2% and
4%; and Barbados, the Dominican Republic, Jamaica, and Suriname, with rates
between 1% and 2%.
The response to the AIDS epidemic in the Caribbean America has involved a
mix of support by governments in the region, bilateral donors (such as the United
States, Canada, and European nations), regional and multilateral organizations, and
nongovernmental organizations (NGOs). Many countries in the region have national
HIV/AIDS programs that are supported through these efforts.
U.S. government funding for HIV/AIDS in the Caribbean has increased
significantly in recent years. Aid to the Caribbean region rose from almost $6
million in FY2000 to $23.2 million in FY2003, largely through the Child Survival
and Health (CSH) foreign assistance funding account. Because of the inclusion of
Guyana and Haiti as focus countries in the President’s Emergency Plan for AIDS
Relief (PEPFAR), largely funded through the Global HIV/AIDS Initiative (GHAI)
funding account, U.S. assistance to the region for HIV/AIDS increased to $36 million
in FY2004, $70 million in FY2005, $79 million in FY2006, and $104 million in
FY2007. For FY2008, the Administration requested almost $116 million in HIV
assistance for the Caribbean, with $83 million for Haiti and $21 million for Guyana.
(See Table 5, which shows U.S. aid levels for HIV/AIDS assistance to the Caribbean
from FY2003-2008. The figures represent a subset of total assistance levels shown
in Table 4.)
In the 110th Congress, H.R. 848 (Fortuño), introduced February 6, 2007, would
add 14 Caribbean countries to the list of focus countries targeted for increased
HIV/AIDS assistance. The additional countries are Antigua and Barbuda, Barbados,
the Bahamas, Belize, Dominica, Grenada, Jamaica, Montserrat, St. Kitts and Nevis,
St. Vincent and the Grenadines, St. Lucia, Suriname, Trinidad and Tobago, and the
Dominican Republic. Another initiative, H.Con.Res. 166 (Lee), introduced June 7,
2007, would support the goals and ideals of National Caribbean American HIV/AIDS
7 For further information, see CRS Report RL32001, HIV/AIDS in the Caribbean and
Central America, by Mark P. Sullivan; and CRS Report RL33485, U.S. International
HIV/AIDS, Tuberculosis, and Malaria Spending: FY2004-FY2008, by Tiaji Salaam-Blyther.
Table 5. U.S. HIV/AIDS Assistance to the Caribbean:
(U.S. $ millions)
CountryFY2003FY2004 aFY2005 aFY2006aFY2007(est.) aFY2008(req.) a
Guyana 4.2 6 .8 14.8 18.0 25.3 21.3
Haiti 7.7 18.3 44.1 47.3 67.3 83.0
J amaica 1 .3 1.3 1 .3 1.5 1 .3 1.2
Carib. Regional4.94.7 a22.214.171.124.0
To tal 23.4 36.4 70.4 78.8 104.1 115.5
Sources: U.S. Agency for International Development, website at [http://www.usaid.gov/our_work/
global_health/aids/Funding/FactSheets/lac.html]; U.S. Department of State, FY2007 and FY2008
Congressional Budget Justification for Foreign Operations. FY2007 estimates were provided by the
Department of State. The figures presented are subtotals of total U.S. assistance to the Caribbean
shown in Table 4.
a. For FY2004, Guyana, received $5.1 million in Global HIV/AIDS Initiative (GHAI) funding and
Haiti received $13 million in GHAI funding. For FY2005-FY2008, all assistance for Guyana and
Haiti was GHAI funding. The remainder of assistance for all countries and years is largely from the
Child Survival and Health (CSH) funding account, with the exception of $1 million in Economic
Support Funds for the Caribbean Regional Program in FY2004.
Millennium Challenge Account.8 Over the past several years, several
Caribbean nations have been potential recipients for Millennium Challenge Account
(MCA) assistance, but none have been selected for the program, which provides
assistance to countries with strong records of performance in the areas of governance,
economic policy, and investment in people. Although Haiti and Guyana have been
candidate countries potentially eligible for MCA funds since FY2004 (because of low
per capita income levels), neither country has been approved to participate in the
program because they have not met MCA performance criteria. Guyana has been
designated as an MCA “threshold” country since FY2005, and in June 2007 was
slated to receive $7.2 million in assistance (from FY2005 MCA funds) to help the
country improve its fiscal policy so that it may become eligible for regular MCA
funding. For FY2006 and FY2007, the per capita income level for MCA-eligibility
increased, and as a result, in addition to Guyana and Haiti, three other Caribbean
countries — the Dominican Republic, Jamaica, and Suriname — became potentially
eligible for MCA funding but ultimately were not approved for participation.
8 For additional information see CRS Report RL32427, Millennium Challenge Account, by
Article 98 Agreements and Sanctions on U.S. Aid.9 An obstacle in the
provision of some U.S. assistance to the Caribbean has been that several Caribbean
nations that are parties to the International Criminal Court (ICC) — Barbados, St.
Vincent, and Trinidad and Tobago — have not signed agreements to exempt
Americans from ICC prosecution, so-called “Article 98 agreements.” The American
Servicemembers’ Protection Act (ASPA, P.L. 107-206, title II), prohibited U.S.
military assistance to countries that are parties to the ICC and do not have Article 98
agreements. In 2006, Congress modified ASPA through a provision in the FY2007
John Warner National Defense Authorization Act (P.L. 109-364), which ended the
ban on IMET; restrictions on FMF, however, remain in effect. Since FY2005,
foreign operations appropriations legislation has also prohibited ESF assistance to
countries that are parties to the ICC and have not signed Article 98 agreements,
although the legislation has provided for presidential waiver.
In July 2003, the Administration announced the termination of military
assistance to six Caribbean nations because they had not signed bilateral immunity
agreements: Antigua and Barbuda, Barbados, Belize, Dominica, St. Vincent and the
Grenadines, and Trinidad and Tobago. Subsequently, Antigua and Barbuda signed
an Article 98 agreement in September 2003; Belize signed one in December 2003;
and Dominica signed one in May 2004. This left Barbados, St. Vincent, and Trinidad
and Tobago as the three Caribbean countries forgoing U.S. military assistance
because of the ASPA sanction. Trinidad and Tobago, which played a leading role in
the establishment of the ICC, has strongly resisted signing an agreement, as has
Barbados. In term of ESF assistance, both Barbados and Trinidad and Tobago
reportedly have been excluded from Third Border Initiative projects, because these
countries have not signed Article 98 agreements.10
Hurricane Recovery and Reconstruction Assistance in 2004. Several
Caribbean nations — especially Haiti, Grenada, Jamaica, and the Bahamas — were
hard hit during the 2004 Atlantic hurricane season. Hurricane Charley struck western
Cuba in August 2004, damaging over 70,000 homes and thousands of hectares of
crops. Hurricane Frances struck the Bahamas in September 2004, causing widespread
damage throughout the country’s islands. In the same month, Hurricane Ivan caused
severe damage across the Caribbean: it devastated Grenada, damaging some 80% of
the nation’s housing, and destroying or damaging much of country’s public
infrastructure; it passed over Jamaica, causing damage in the western part of the
island and in southern coastal towns; and it affected western Cuba, damaging houses
and crops. Tropical Storm Jeanne caused devastating mudslides and floods in
northern Haiti in September 2004 that killed some 3,000 people, with over 2,800 of
those in the city of Gonaives. Another 300,000 Haitians were affected by the loss of
homes, livelihoods, and infrastructure.
9 For additional information see CRS Report RL33337, Article 98 Agreements and Sanctions
on U.S. Foreign Aid to Latin America, by Clare M. Ribando.
10 Senate Foreign Relations Committee, Hearing on “The Impact on Latin America of the
American Servicemembers’ Protection Act,” Testimony of Peter DeShazo, Center for
Strategic and International Studies, March 2006.
In response, the United States provided immediate humanitarian assistance to
several Caribbean nations, especially Grenada, Haiti, and Jamaica, but also the
Bahamas, the Dominican Republic, and Cuba. USAID’s Office of Foreign Disaster
Assistance (OFDA) set up Disaster Assistance Response Teams (DARTs) to respond
to the storms, with team members located in the various islands. By the end of
October 2004, USAID had provided almost $23 million in emergency humanitarian
assistance, largely for assistance to respond to Hurricane Ivan and Tropical Storm
Jeanne. In addition, the 108th Congress appropriated $100 million in emergency
assistance (P.L. 108-324) in late October 2004 to provide longer-term reconstruction
assistance for Caribbean nations afflicted by the storms.
The reconstruction assistance was targeted as follows: $42 million for Grenada,
$38 million for Haiti, $18 million for Jamaica, and $2 million for other countries
affected by the storms. In Grenada, USAID’s assistance program had two phases.
The first was a short-term program to restore and revitalize rural communities, repair
schools and health centers, and reestablish the productive capacity of small and
medium-size businesses. The second, longer-term phase focused on rebuilding
infrastructure, revitalizing the business sector, and restoring the government’s
economic management capacity.
In Haiti, the reconstruction program had two major components. A community
revitalization component involved road repair, disaster mitigation, water system
rehabilitation, drainage and clean up, public building rehabilitation, and household
repairs. A rural revitalization component involved hillside stabilization, irrigation,
and an early warning system for flooding on the La Quinte River, which flows past
Gonaives, the city that was devastated by Tropical Storm Jeanne.
The Jamaica assistance program also had two phases. The first was an
immediate recovery program to help repair community infrastructure and help
revitalize the agricultural sector. The second phase involved the repair and
rebuilding of homes, assistance for business recovery, and the rehabilitation and re-
supply of schools. Other smaller hurricane assistance programs targeted affected
communities in the Bahamas and Tobago, and also provided assistance to Eastern
Caribbean nations to design and implement risk reduction efforts for low-income
Drug Trafficking and Money Laundering Issues
Because of their geographic location, many Caribbean nations are transit
countries for cocaine and heroin from South America destined for the U.S. and
European markets. In addition, two Caribbean nations — Jamaica and St. Vincent
and the Grenadines — are large producers and exporters of marijuana. Of the 16
countries in the Caribbean region, President Bush designated four of them — the
Bahamas, the Dominican Republic, Haiti, and Jamaica — as major drug-producing
or drug-transit countries in September 2006 pursuant to annual legislative drug
11 USAID, Jamaica-Caribbean Regional Program. “Hurricane Recovery & Rehabilitation
Program for Grenada, Jamaica, and the Caribbean Region,” Eleventh Report, November
certification requirements. The President urged the new government in Haiti to
strengthen law enforcement and the judiciary to bring drug trafficking and crime
All four designated Caribbean countries are major transit countries for illicit
drugs to the U.S. market, and Jamaica is the largest marijuana producer and exporter
in the Caribbean. The Bahamas cooperates extensively with the United States on
counternarcotics measures, including interdiction efforts through Operation Bahamas
and Turks and Caicos (OPBAT), a multinational interdiction effort, and efforts that
target Bahamian drug trafficking organizations. The Dominican Republic, a major
transit country for both cocaine and heroin, cooperates closely with the United States,
although the State Department’s March 2007 International Narcotics Control
Strategy Report notes that “corruption and weak governmental institutions remained
an impediment to controlling the flow of illegal narcotics” through the country.
Jamaican cooperation with U.S. law enforcement agencies on counternarcotics efforts
is described by the State Department report as robust, but the report also noted that
the government seemed unable to act against official corruption, ranging from petty
shakedowns by street cops to higher-level corruption and other criminal activities.
In Haiti, anti-drug efforts have been hampered over the years by weak institutions,
poor economic conditions, and political instability. According to the State
Department report, a challenge for the Preval government is curbing continued
violence perpetrated by criminal elements, some of whom are involved in drug
Many other Caribbean nations, while not designated major transit countries, are
still vulnerable to drug trafficking and associated crimes because of their geographic
location. In particular, the State Department’s March 2007 report maintains that such
crimes have the potential to threaten the stability of the small states of the Eastern
Caribbean, and to varying degrees, have damaged civil society in some of these
countries. Given the poor outlook for the banana industry in the Caribbean, some
observers believe that it will be difficult to contain marijuana production unless there
is adequate support to diversify these economies away from banana production. St.
Vincent and the Grenadines is the largest marijuana producer in the Eastern
Efforts to crack down on money laundering also constitute a major component
of U.S. anti-drug strategy, and became increasingly important as a counter-terrorist
strategy in the aftermath of the September 2001 terrorist attacks in the United States.
The State Department’s list of major money laundering countries (also categorized
as “jurisdictions of primary concern”) includes six Caribbean countries — Antigua
and Barbuda, the Bahamas, Belize, the Dominican Republic, Haiti, and St. Kitts and
Nevis — and one British Caribbean dependency, the Cayman Islands. The
Department of State, in its March 2007 drug strategy report, maintains that although
Antigua and Barbuda has comprehensive legislation to regulate its financial sector,
the country remains vulnerable to money laundering because the sector is loosely
12 White House, Press Release, “Memorandum for the Secretary of State: Presidential
Determination on Major Drug Transit or Major Illicit Producing Countries for Fiscal Year
regulated and because of its Internet gaming industry; the report notes that Antigua
and Barbuda has yet to prosecute a money laundering case. The Bahamas has
enacted strong anti-money laundering laws that has made it difficult for drug
traffickers to deposit large amounts of cash; as a result, traffickers have begun storing
large quantities of cash in safe houses, purchasing real estate, vehicles, and jewelry,
and processing money through legitimate businesses and shell companies. In Belize,
money laundering is believed to occur primarily in the country’s growing offshore
financial center. Money laundering in both the Dominican Republic and Haiti stems
from their roles as major drug transhipment points. In the Dominican Republic,
financial institutions engage in transactions with money derived from illegal drug
sales in the United States, with courier and wire transfers the primary methods for
moving the funds. St. Kitts and Nevis, according to the State Department, is at major
risk for corruption and money laundering because of the high volume of narcotics
being trafficked through the country and because of the presence of known traffickers
on the islands.
The Financial Action Task Force on Money Laundering (FATF), an
inter-governmental body with the objective of combating money laundering and
terrorist financing, has published a list of non-cooperative countries and territories
in the fight against money laundering since 2000. The FATF evaluative process has
been a major factor in Caribbean countries improving their anti-money laundering
regimes. Four Caribbean nations and one dependent territory were on the first FATF
non-cooperative list issued in 2000: the Bahamas, the Cayman Islands, Dominica, St.
Kitts and Nevis, and St. Vincent and the Grenadines. Grenada was added to the list
in September 2001. Subsequent actions by all these nations to improve their anti-
money laundering regimes resulted in all of them being removed from the list by June
2003. The Bahamas and the Cayman Islands were removed from the list in June
2001; St. Kitts and Nevis in June 2002; Dominica in October 2002; Grenada in
February 2003; and St. Vincent in June 2003. Once a nation is removed from the list,
the FATF continues to monitor developments in the country to ensure compliance.
Some Caribbean officials and others have complained that pressure to
strengthen and enforce anti-money laundering regimes in the region have had a
detrimental effect on its offshore financial sectors. They maintain that the anti-
money laundering measures required have been indiscriminate and constitute an
attack on legitimate business conducted in the small financial sectors of the region.
In particular, after the U.S. congressional passage of new anti-money laundering
provisions in the USA PATRIOT Act (P.L. 107-56, Title III), approved in the
aftermath of the September 11 terrorist attacks, some feared that the stricter scrutiny
of transactions between U.S. and Caribbean financial institutions would threaten the
offshore financial industry in the Caribbean.13 The act’s anti-money laundering
provisions include a prohibition on U.S. correspondent accounts with shell banks
13 For example, see “Barbados — Weighed Down by Money Laundering Controls —
Bankers and Government Officials Are Worried that Hasty Decisions in the War Against
Money Laundering Could Threaten the Financial Services Industry in Small Jurisdictions
Like Barbados,” The Banker, July 1, 2003; “U.S. Lawmaker: Antiterror Laws May Hurt
Offshore Banking,” Dow Jones International News, January 5, 2003.
(banks that have no physical presence in the chartering country) and tighter bank
record keeping requirements.
Some observers maintain that the strengthening of anti-money laundering
regimes in the Caribbean will have the end result of increasing the attractiveness of
the region’s offshore financial sectors for legitimate business transactions.
According to this view, such efforts as the FATF evaluative process and the anti-
money laundering measures under the PATRIOT Act will help change the reputation
of the Caribbean as being a haven for money launderers and tax evaders.
Tax Haven Issue
Legislation has been introduced in the 110th Congress that would restrict the use
of offshore tax havens and tax shelters to avoid U.S. Federal taxation. S. 396
(Dorgan), would amend the Internal Revenue Code to treat controlled foreign
corporations established in tax havens as domestic corporations, including those in
several Caribbean states. S. 681 (Levin) and H.R. 2136 (Doggett), the Stop Tax
Haven Abuse Act, would restrict the use of offshore tax havens and tax shelters to
inappropriately avoid Federal taxation. Of the 34 countries and territories listed in
S. 681/H.R. 2136 as “offshore secrecy jurisdictions,” 16 are in the Caribbean:
Anguilla, Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bermuda,
British Virgin Islands, Cayman Islands, Dominica, Grenada, Netherlands Antilles,
St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, and Turks and Caicos
Caribbean nations have strongly objected to the legislation because they believe
it unfairly targets the region. They have called for the removal of CARICOM member
states from the legislation, asserting that the countries are in compliance with
international information and transparency requirements. According to the
Organization for Economic Co-operation and Development (OECD), 17 Caribbean
nations and territories that have been categorized as tax havens have committed to
improving transparency, and are not listed on the OECD’s list of uncooperative tax
havens. Barbados, which had been listed as an OECD tax haven in 2000, was
subsequently removed from the list because of its longstanding information exchange
arrangements with other countries, and its actions to further enhance the transparency14
of its tax and regulatory rules.
14 Organization for Economic Co-operation and Development, “35 Jurisdictions Committed
to Improving Transparency and Establishing Effective Exchange of Information in Tax
Matters,” December 12, 2003.
Internet Gambling Issue15
A controversial issue in U.S. relations with the Caribbean has been a World
Trade Organization (WTO) complaint filed by Antigua and Barbuda challenging U.S.
restrictions on cross-border Internet gambling. Antigua, which has invested in
Internet gambling as a means of diversifying its economy, maintains that it has lost
millions of dollars because of the U.S. restrictions. In April 2005, the WTO
Appellate Body ruled that the restrictions were inconsistent with U.S. market access
commitments under the General Agreement on Trade in Services (GATS), but that
the United States could justify them under the GATS public morals exception. The
Appellate Body also found, however, that the United States did not appear to be in
full compliance with the exception because of possible discriminatory treatment of
foreign service suppliers in the area of horseracing. The United States was given
until April 2006 to comply. In July 2006, the WTO established a compliance panel
at the request of Antigua, which maintained that the United States had taken no
action in response to the 2005 decision.16 The compliance panel ruled in Antigua’s
favor in March 2007.
In May 2007, the United States Trade Representative (USTR) announced that
the United States would modify its commitments under the GATS to rule out any
market access commitments on gambling services. As a result, Antigua and Barbuda,
along with the European Union, Japan, India, Costa Rica, Macao, Canada, and
Australia are seeking compensation from the United States for the decision to change
its commitments under the GATS. A first round of talks on the issue was held in July
2007.17 In addition, Antigua and Barbuda announced separately in June that it would
seek authorization from the WTO to impose more than $3.4 billion in annual trade
sanctions on the United States for not complying with the 2005 WTO ruling against
U.S. restrictions on cross-border Internet gambling. U.S. officials challenged
Antigua’s retaliation figure, and an arbitration panel was set up in late July 2007 to
rule on Antigua’s request. Antigua maintains that it simply wants a negotiated
solution in the gambling case.18
CARICOM officials have expressed concerns about U.S. inaction in the WTO
case and have told U.S. officials that they consider it a regional Caribbean issue with
the United States as opposed to just a U.S. bilateral issue with Antigua and
15 For additional information on the WTO case, CRS Report RL32014, WTO Dispute
Settlement: Status of U.S. Compliance in Pending Cases, by Jeanne J. Grimmett.
16 Esther Lam, “WTO Unveils Revamped Panel to Determine U.S. Compliance in Internet
Gambling Case, International Trade Reporter, August 24, 2006; and Daniel Pruzin, “WTO
Issues Appellate Ruling on Gambling Over Internet,” International Trade Reporter, April
17 Daniel Pruzin, “U.S. Holds First Round of Talks with Nations Requesting Compensation
for Gambling Ban,” International Trade Reporter, July 19, 2007.
18 Rossella Brevetti, “Antigua’s Objective in Gambling Case at WTO Is Negotiated Solution,
Counsel Says,” International Trade Reporter, August 2, 2007.
Barbuda.19 The issue was raised by Caribbean officials during CARICOM’s June
2007 Washington conference, with CARICOM states urging the United States to
collaborate with Antigua and Barbuda.
U.S. Trade Policy20
The United States has offered a one-way duty-free preferential trade
arrangement for a wide range of products from Caribbean Basin nations since the
early 1980s as an incentive for increased investment and export production in the
region. These preferences have changed over the years, but are broadly referred to
as the Caribbean Basin Initiative (CBI). In 1983, Congress enacted the Caribbean
Basin Economic Recovery Act (CBERA), which allowed duty-free importation of
many categories of products with certain significant exceptions. Most apparel and
textile goods were ineligible under the CBERA, but in the late 1980s imports of
apparel from CBERA countries that were assembled from U.S. components became
eligible for reduced duties. These production-sharing arrangements boosted the
apparel sectors of several Caribbean Basin countries. In 1990, Congress enacted so-
called CBI II legislation that enhanced the benefits of CBERA and made its
Congress approved the Caribbean Basin Trade Partnership Act (CBTPA) (P.L.
106-200, Title II) in 2000, which expanded preferential tariff treatment for Caribbean
Basin nations, providing them with preferential tariff treatment on their exports to the
United States, similar to that provided under the North American Free Trade
Agreement. Most significantly, this included preferential treatment for petroleum
products and qualifying textile and apparel products. To be eligible for the program,
countries must fulfill criteria covering a wide spectrum of issues, including WTO
obligations, intellectual property rights, worker rights, child labor, and
counternarcotics, anti-corruption, and transparency efforts.
The CBTPA benefits are scheduled to expire at the end of September 2008, or
earlier if the country enters into a free trade agreement with the United States.
Currently, seven Caribbean countries are participating in the CBTPA program
because they fully meet the eligibility criteria: Barbados, Belize, Guyana, Haiti,
Jamaica, St. Lucia, and Trinidad and Tobago. The Dominican Republic traded its
benefits under both the CBERA and the CBTPA when it approved implementing
legislation in March 2007 for a reciprocal free trade agreement with the United States
as part of the Dominican Republic-Central America-United States Free Trade
Agreement (CAFTA-DR).21 Remaining Caribbean countries continue to benefit
from the CBERA program with the exception of Cuba, which is not eligible, and
Suriname, a former Dutch colony which has never elected to participate in the CBI
19 “CARICOM Backs Antigua in On-Line Gambling Dispute with USA,” BBC Monitoring
Latin America, October 15, 2006.
20 For further information, see CRS Report RL33951, U.S. Trade Policy and the Caribbean:
From Trade Preferences to Free Trade Agreements, by J. F. Hornbeck.
21 For further information, see CRS Report RL31870, The Dominican Republic-Central
America-United States Free Trade Agreement (CAFTA-DR), by J. F. Hornbeck.
trade program. As noted above, the CBERA program has no expiration date. Haiti
received additional tariff preferences beyond CBERA and CBTPA in 2006 when
Congress approved the Haitian Hemispheric Opportunity through Partnership
Encouragement (HOPE) Act of 2006 (Title V of P.L. 109-432), which includes more
flexible rules of origin for apparel.
Since the United States first implemented a preferential trade program for
Caribbean Basin imports in 1984, the overall performance of the region’s exports has
been mixed (see Table 6). The Dominican Republic has been the Caribbean country
that has benefitted most from the program, and its apparel sector expanded
significantly because of production-sharing arrangements. Overall U.S. imports from
the Caribbean amounted to about $4.8 billion in 1984 and to about $14.9 billion in
2005, an increase of over $10 billion. The Dominican Republic accounted for $3.5
billion of the increase. Trinidad and Tobago, an oil and gas exporter, increased its
exports destined for the United States from $1.4 billion in 1984 to about $8.4 billion
in 2005. For other Caribbean nations, however, such as Haiti and the Bahamas,
overall exports to the United States have declined or been stagnant since the early
1980s. Bahamian exports to the United States fell when the country’s oil refinery
closed in 1985; the country’s economy remains based on tourism and financial
services. Many small Caribbean nations have service-based economies, with tourism
and financial services the leading sectors. As a result, the U.S. trade preferences have
not had a significant economic impact on these small economies.
U.S. exports to the Caribbean region (including agricultural exports to Cuba,
which have been allowed since late 2001) rose from $8.9 billion in 2001 to $14.2
billion in 2006 (see Table 7). Four Caribbean countries — Dominican Republic,
Trinidad and Tobago, Jamaica, and the Bahamas — are the destination for the lion’s
share of U.S. exports to the region. In 2006, U.S. exports to these four countries
accounted for 79% of total U.S. exports to the Caribbean. The United States ran a
trade deficit of almost $700 million with the Caribbean in 2006, largely because of
natural gas imports from Trinidad and Tobago. For most other Caribbean nations,
the United States ran a significant trade surplus.
Movement Toward Free Trade. All Caribbean nations with the exception
of Cuba are participating in the negotiations for a Free Trade Area of the Americas22
(FTAA), although negotiations for that agreement have been stalled since 2004.
Within CARICOM, while some governments, like Trinidad and Tobago, are
enthusiastic about the FTAA, other Caribbean governments, especially the smaller
countries of the region, have reservations about the FTAA and its impact on the
region. While participating in the FTAA negotiations, Caribbean nations argue for
special and differential treatment for small economies, including longer phase-in
periods. CARICOM has also called for a Regional Integration Fund to be established
that would help the smaller economies meet their needs for human resources,
technology, and infrastructure.
22 For background and status of the FTAA negotiations, see CRS Report RS20864, A Free
Trade Areas of the Americas: Major Policy Issues and Status of Negotiations, by J. F.
In April 2006, U.S. and CARICOM trade officials meeting in Washington began
exploring the possibility of a free trade agreement, although Caribbean ministers
reportedly maintained that they would only negotiate such an agreement if it included
extensive transition periods for Caribbean nations.23 The officials also agreed to
revitalize a dormant Trade and Investment Council, originally established in the early
1990s, that would be the mechanism used to continue exploratory talks on an FTA
as well as other trade and investment issues.
A key issue for the Caribbean and Congress is how to deal with the impending
expiration of the CBTPA program in September 2008, which provides the greatest
trade benefits to the region. At CARICOM’s June 2007 meeting in Washington
D.C., a joint U.S.-CARICOM statement expressed determination to strengthen
existing trade arrangements. President Bush pledged to Caribbean leaders that he
would work with Congress to extend and update the CBPTA.24
23 “CARICOM Members Seek Special Treatment in FTA Talks with U.S.,” Inside U.S.
Trade, April 14, 2006.
24 White House, Press Release, “Joint Statement: Conference on the Caribbean,” June 20,
June 21, 2007.
Table 6. U.S. Imports from Caribbean Countries
(U.S. $ millions)
Country 1984 2002 2003 2004 2005 2006
Bahama s 1,154.282 449.697 479.305 637.687 699.936 452.815
Barbados 252.598 34.438 43.428 36.882 31.904 33.842
Belize 42.843 77.668 101.443 107.020 98.265 146.814
Domi nica .086 4.670 5.252 2.883 3.344 3.148
Grenada .766 6.886 7.602 5.101 5.853 4.467
Guya na 74.417 115.615 118.690 122.398 119.931 125.237
Haiti 377.413 255.007 332.340 370.681 447.217 496.141
J a ma ica 396.949 396.317 422.749 319.737 375.572 519.596
St. Kitts and Nevis23.13548.62744.58841.70949.71950.070
Sur i name a 104.636 132.722 140.064 140.820 165.346 164.539
Tot a l 4,799.911 8,170.014 10,514.352 12,176.960 14,544.116 14,933.621
Source: 1984 statistics are from U.S. International Trade Commission, The Impact of the Caribbean Basin Economic
Recovery Act, Fifteenth Report, 1999-2000, September 2001; 2000-2005 trade statistics are from the Department of
Commerce, as presented by World Trade Atlas.
a. Suriname has not been a beneficiary of the Caribbean Basin Initiative preferential trade program.
Table 7. U.S. Exports to Caribbean Countries
(U.S. $ millions)
Country 2001 2002 2003 2004 2005 2006
Bahama s 1,026.342 975.309 1,074.694 1,185.751 1,786.740 2,288.164
Barbados 286.613 267.646 300.095 348.432 394.920 443.141
Belize 173.167 137.667 198.808 151.832 217.563 238.815
Cuba 7.096 145.649 259.127 404.141 369.035 347.775
Domi nica 30.690 44.972 34.332 35.989 61.540 68.024
Domi nican 3,757.045 4,250.068 4,205.449 4,358.279 4,718.733 5,347.802
Grenada 59.873 56.406 68.420 70.103 82.440 75.594
Guya na 141.252 128.208 117.148 138.411 176.705 179.418
Haiti 550.383 573.185 639.441 672.978 709.621 809.406
J a ma ica 1,405.522 1,420.187 1,469.545 1,430.780 1,700.769 2,034.999
St. Kitts and46.33849.46158.76860.32294.069127.234
Suriname 155.306 124.757 192.655 179.189 245.701 258.158
Tot a l 8,947.875 9,415.033 9,974.853 10,520.289 12,345.831 14,237.318
Source: Trade statistics are from the Department of Commerce, as presented by World Trade Atlas.
Third Border Initiative and Security Issues
As first announced by President Bush at the April 2001 Summit of the
Americas, the “Third Border Initiative” (TBI) had the goals of deepening cooperation
in fighting the spread of HIV/AIDS, responding to natural disasters, and making sure
the benefits of globalization are felt in even the smallest economies. The Caribbean
was described as an often overlooked “third border,” where illegal drug trafficking,
migrant smuggling, and financial crime threaten U.S. and regional security interests.
The initiative consisted of a package of programs to enhance diplomatic, economic,
health, education, and law enforcement cooperation and collaboration. Most
significantly, the initiative included increased funding to combat HIV/AIDS in the
In the aftermath of the September 2001 terrorist attacks in the United States, the
Third Border Initiative expanded to focus on issues affecting U.S. homeland security
in the fields of administration of justice and security. Economic Support Funds
(ESF) under the TBI have been used to help Caribbean airports modernize their
safety and security regulations and oversight, which is viewed an important measure
to improve the security of visiting Americans. TBI funds have also been used to
support border security such as the strengthening of immigration controls; to help
Caribbean economies move toward greater competitiveness; and to support an
improvement of environmental management.26 Assistance in FY2007 was used to
help Caribbean nations enhance security in preparation for the Cricket World Cup
Recent funding for the TBI amounted to $8.9 million in FY2005, almost $3
million in FY2006, and a request of $3 million for FY2007. For the FY2008 request,
the TBI has been subsumed into a larger Western Hemisphere Regional Program,
with $1.75 million in ESF that will support TBI activities designed to enhance
diplomatic, economic, health, education, disaster preparedness, and law enforcement
cooperation and collaboration. An unspecified portion of $1.1 million humanitarian
assistance under the Western Hemisphere Regional Program would fund TBI
activities that help Caribbean governments plan and prepare for natural disasters.
(See Table 4 on U.S. assistance to the Caribbean.)
Caribbean nations have been supportive of the TBI program, and in 2004 signed
a joint declaration with the United States stating that the TBI was a valuable
framework for structuring Caribbean-U.S. engagement and enhancing cooperation
in a variety of areas: diplomatic, security, economic, environmental, health, and27
25 U.S. Department of State, International Information Programs, Washington File, “Fact
Sheet: Caribbean Third Border Initiative,” April 21, 2001.
26 U.S. Department of State. Congressional Budget Justification for Foreign Operations.
27 U.S. Department of State,
Muslim Extremists. As noted above, in early June 2007, the Department of
Justice announced that four individuals — two Guyanese nationals, one Trinidadian
national, and one U.S. citizen of Guyanese origin — were being charged with
conspiring to blow up fuel tanks and a fuel pipeline at JFK International Airport in
New York. The U.S. citizen — Russell Defreitas, a former airport cargo worker at
JFK — was arrested in New York. The two Guyanese nationals, Abdul Kadir (a
former member of Guyana’s parliament) and Abdel Nur, and the Trinidadian
national, Kareen Ibrahim, were arrested in Trinidad and Tobago and face extradition
to the United States to stand trial. According to the Justice Department, the failed
“plot tapped into an international network of Muslim extremists from the United
States, Guyana, and Trinidad,” and the defendants “used their connections to present
their terrorist plot to radical groups in South America and the Caribbean, including28
senior leadership of Jamaat al Muslimeen (JAM).” The JAM had been responsible
for a bloody coup attempt in 1990 in Trinidad and Tobago. Some news reports29
maintain that the plotters had also planned to seek help from Iran. U.S. officials
have lauded cooperation from both Guyana and Trinidad and Tobago as instrumental
in deterring the plot, and the arrests have highlighted the strong counterterrorism
cooperation between the Caribbean and the United States.30
For some observers, the failed plot focuses attention to the potential security
threat posed by Muslim extremists in the Caribbean. According to this view, while
there are doubts that the accused had the resources and expertise to carry out the plot,
the very presence of such individuals in the region espousing such radical views
warrants closer scrutiny and attention.31 Some terrorism specialists, however,
maintain that there is little evidence to indicate that Muslims in the Caribbean in such
countries as Guyana and Trinidad and Tobago are attracted to radical Islamist
ideologies. They contend that the JAM in Trinidad and Tobago has not a track
record of operating outside of Trinidad.32
Port Security. In addition to the TBI, the United States has also provided
support to improve port security in the Caribbean region, with the objective of
helping ports comply with the more stringent set of maritime regulations embodied
in new International Ship and Port Facility Security (ISPS) Code, which went into
effect on July 1, 2004. The ISPS is a set of maritime regulations for ships and port
facilities with the objective of preventing terrorist incidents. There has been concern
among Caribbean nations about the high cost of implementing these security
regulations. Some of the larger, richer countries in the Caribbean will be better
28 U.S. Department of Justice, “Four Individuals Charged in Plot to Bomb John F. Kennedy
International Airport,” Press Release, June 2, 2007.
29 Andrew O. Selsky, “3 To Be Extradited in Alleged JFK Plot,” Associated Press, August
30 Bruce Zagaris, “JFK Bomb Plot Spotlights U.S.-Caribbean Enforcement Cooperation,”
International Enforcement Law Reporter, August, 2007.
31 “JFK Plot Puts Spotlight on the Caribbean,” Latin American Regional Report: Caribbean
and Central America, June 2007, p. 13.
32 Chris Zambelis, “Spotlight on Trinidad and Tobago’s Jamaat al-Muslimeen,” Terrorism
Monitor, Jamestown Foundation, June 21, 2007.
equipped to afford these extra security costs, while some of the smaller and poorer
nations will have difficulty coming into compliance.
The U.S. Coast Guard has responsibility for conducting foreign port security
assessments to see whether the ports are in compliance with the ISPS standards.
Trade sanctions are an option if the port is not in compliance. By November 2004,
all Caribbean nations had self-reported that they were in compliance with the more
stringent standards of the ISPS Code. The Coast Guard is currently involved in
visiting foreign ports worldwide to ensure that security practices are up to standards.
According to the Government Accountability Office, most Caribbean ports visited
by the Coast Guard have implemented the ISPS Code to a large degree, but the Coast
Guard also found facilities in some counties that needed to make improvements or
take additional measures.33
In addition to the Coast Guard, several U.S. agencies have provided some
support to help Caribbean nations come into compliance with the ISPS Code and
improve port security. The U.S. Maritime Administration (MARAD) in the
Department of Transportation organizes, manages, and implements the Inter-
American Port Security Training Program (IAPSTP) for the Organization of
American States. The State Department’s Bureau for International Narcotics and Law
Enforcement Affairs has funded port security improvements for several Western
Hemisphere countries. In the past, USAID has funded a project specifically for
Eastern Caribbean nations to help assess the status of each port’s security
requirements and its security plans, and has more recently funded a program to help
Haiti comply with ISPS Code requirements.34
Several Caribbean ports are included in the Container Security Initiative (CSI),
a program implemented by U.S. Customs and Border Protection (CBP) of the
Department of Homeland Security. The CSI program helps ensure that high-risk
containers are identified and inspected at foreign ports before they are placed on
vessels for delivery to the United States. In September 2006, three Caribbean ports
became operational CSI ports: Caucedo, Dominican Republic; Kingston, Jamaica;
and Freeport, Bahamas. All three of these ports are also involved in the Megaports
Initiative run by the National Nuclear Security Administration of the Department of
Energy. That initiative has the goal of deploying radiation detection equipment to
ports in order to detect nuclear or radioactive materials. The Megaports Initiative is
currently operational in the Bahamas, while Jamaica and the Dominican Republic are
working to implement the program.
U.S. Passport Requirements. Caribbean nations that depend on tourism
such as Jamaica and the Bahamas have expressed concern about the potential
negative effects on tourism in the region because of new U.S. passport requirements
mandated by Section 7209 of the Intelligence Reform and Terrorism Prevention Act
of 2004 (P.L. 108-458), known as the Western Hemisphere Travel Initiative.
Beginning January 23, 2007, U.S. citizens traveling by air to the Caribbean
33 U.S. Government Accountability Office, Information on Port Security in the Caribbean
Basin, June 29, 2007, GAO-07-804R.
(including Bermuda), as well as to Canada and Mexico, require passports. The
requirement for the Caribbean originally had been set for December 31, 2005, but
subsequently was delayed several times. Because of an extensive backlog of passport
applications, the Departments of State and Homeland Security announced on June
8, 2007, that there would be some flexibility with the policy through the end of
September 2007, whereby individuals who have applied but have not yet received
their passports are able to travel with a government-issued photo and official proof
of their passport application.35
The Caribbean tourism industry has feared that the impact of the air travel
passport requirement would be catastrophic for Caribbean economies.36 To date,
according to some anecdotal reports, the passport requirement has discouraged some
travelers to the region, with reports of 10% declines in U.S. tourists going to Jamaica
and other islands.37 In the Bahamas, stopover tourists declined 5% in the first quarter
of 2007 compared to the same period in 2006.38
The passport requirement for U.S. citizens traveling by sea to the Caribbean (as
well as by land and sea to Canada and Mexico) could be implemented as early as
January 2008, according to the Department of State, but an exemption for cruise ship
travel could mitigate a negative affect on tourism in the region. Proposed rules were
published in the Federal Register on June 26, 2007, which laid out the documents
that would be required for those traveling by land and sea.39 Under the proposed
rules, U.S. citizens traveling on cruise ships on round trip voyages that begin and end
in the same U.S. port would not require passports, but could travel with government-
issued photo ID and a certified copy of their birth certificate. For several Caribbean
nations, however, a majority of tourism revenues are derived from tourists arriving
by air, compared to day trippers from cruise ships.
In the 110th Congress, both the House and Senate-passed versions of H.R. 2638,
the FY2008 Department of Homeland Security Appropriations Act have provisions
that would delay the implementation of any plan for passport requirements to no
earlier than June 1, 2009. The House approved its provision in the bill on June 15,
2007, when it passed H.Amdt 291 (LaTourette), by a vote of 379 to 25, prohibiting
any funds in the bill from implementing a passport requirement plan under section
35 U.S. Department of State, “Joint Departments of State and Homeland Security
Announcement: U.S. Citizens With Pending Passport Applications Allowed Temporary
Travel Flexibility Within Western Hemisphere,” June 8, 2007, available at
[ ht t p: / / www.st at e.gov/ r / pa/ pr s / ps/ 2007/ j un/ 86206.ht m]
36 Sean Lengell, “U.S. Rules May Hit Caribbean,” Washington Times, October 18, 2006;
“U.S. Passport Move Will Devastate Caribbean Economy,” BBC Monitoring Latin America,
October 14, 2006.
37 Danica Coto, “Caribbean Fret Over Drop in American Tourists,” Associated Press, July
38 “Bahamas, Country Report,” Economist Intelligence Unit, July 207, p. 13.
39 Federal Register, Vol. 72, No. 122, June 26, 2007, pp. 35087-35116.
1, 2009. The Bush Administration opposes any provisions in the bill that would
delay implementation of the Western Hemisphere Travel Initiative to June 2009.
Crime. High rates of violent crime, including murder and kidnaping, is a major
public security concern throughout the Caribbean. Jamaica, with 1,335 murders in
Other countries with high murder rates in 2006 were St. Kitts and Nevis (35.5),
Belize (32.2), Trinidad and Tobago (28.6), St. Lucia (24), and Guyana (20.4).40
According to a March 2007 joint UN/World Bank study, homicide rates in the
Caribbean are high by world standards. Comparative international rates from 2002
show that the region has more murders per capita — 30 per 100,000 — than any
other region in the world, compared to a rate of 29 for Southern and West Africa, 2641
for South America, and 7 for North America.
The UN/World Bank study concluded that the transit of illicit drugs through the
Caribbean is the major factor contributing to high rates of crime and violence in the
region. The report maintained that a criminal justice-focused approach is necessary
for certain types of crime and violence, but contended that there has been over-
reliance on this approach for crime reduction in the region. Additional approaches
could focus on prevention, environment-improvement, community policing, and
targeted youth services. The report also called for more reintegration services for
deportees (see discussion below) and for the availability of firearms to be limited and42
U.S. deportations to Latin American and Caribbean countries constitute the43
overwhelming majority of U.S. deportations worldwide. In FY2006, for example,
the Department of Homeland Security (DHS) deported almost 197,000 aliens
worldwide, with almost 188,000 of those, or 95%, going to Latin American and
Caribbean countries. Overall in FY2006, some 45% of those deported to Latin
America and the Caribbean were removed based on a criminal conviction. For a
number of countries, particularly in the Caribbean, a majority of those deported were
removed on criminal grounds. Legislation enacted in 1996 — the Antiterrorism and
Effective Death Penalty Act of 1996 (AEDPA, P.L. 104-132) and the Illegal
Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA, Division
C of P.L. 104-208) — made changes to immigration law that increased the number
40 “Organization of Eastern Caribbean States, Country Report,” Economist Intelligence Unit,
June 2007, pp. 33-34.
41 United Nations Office on Drugs and Crime (UNODC)and World Bank, “Crime, Violence,
and Development: Trends, Costs, and Policy Options in the Caribbean,” March 2007, pp 4-
42 Ibid, pp. ii-iv.
43 These are formal deportations, consisting of those who are placed in removal proceedings,
and do not include voluntary departures. For more information see CRS Report RL33351,
Immigration Enforcement Within the United States, coordinated by Alison Siskin.
of aliens44 subject to deportation and decreased access to relief from deportation. As
a result, U.S. deportations to the Latin American and Caribbean region have
increased (as with deportations worldwide) more than fourfold over the past decade,
from over 46,000 in FY1995 to, as noted above, some 199,000 in FY2005 and almost
Caribbean countries accounted for just over 3% of total U.S. deportations in
FY2006, with 6,100 aliens deported to the sub-region. Among Caribbean countries,
the major recipient of U.S. deportations in FY2006 were the Dominican Republic,
with over 2,800 of its citizens deported, accounting for 46% of U.S. deportations to
the Caribbean; Jamaica, with over 1,400 deportations, or 23%; and Haiti, with over
800, accounting for just over 13%. A number of small English-speaking Caribbean
nations — such as St. Kitts and Nevis, Antigua and Barbuda, and Guyana — while
having much smaller numbers of their citizens deported from the United States, were
among the top recipient countries on a per capita basis. For most Caribbean nations,
with the exception of Haiti, a large majority of their citizens deported from the
United States were removed on criminal grounds. For example, almost 88% of
Jamaicans and 80% of Dominicans were deported on criminal grounds in FY2006.
(See Table 8.)
The deportation of Caribbean citizens from the United States has been one of
the thorniest issues between Caribbean nations and the United States for a number
of years, with challenges centered on criminal deportees and social stigma. The
number of U.S. criminal deportations to the Caribbean has increased from just over
3,100 in FY1996 to over 5,300 in FY2005, although the number fell to about 4,500
in FY2006.45 While the majority of those returned are not hardened criminals, even
a small number of such criminals can cause significant problems. A recent U.N.-
World Bank study concluded that it is unlikely that the average deportee in Jamaica
is committing violent crime, and that statistics on criminal deportees in Barbados and
Trinidad and Tobago show low re-offender rates among criminal deportees.
Nevertheless, the study maintains that it is possible that some deportees are involved
in violent crime, and that such activity can have a significant impact in such small46
Stigma has been a major problem facing deportees to Caribbean countries, with
employers often unwilling to hire deportees because of the perception that they are
hardened criminals that cannot be trusted. Caribbean officials often fuel the stigma
by contending that the deportees are largely responsible for the rise in crime in the
region. For example, Haitian officials have repeatedly criticized the deportations, and
have blamed the country’s increase in violent crime and kidnaping on the deportees.
In contrast, foreign diplomats as well as officials of the U.N. police force in Haiti
dispute this, and assert that Haiti’s powerful street gangs are responsible for the
44 Defined as any person who is not a citizen or national of the United States.
45 Deportation statistics for 1996 and 2005 are from the annual Yearbook of Immigration
Statistics, DHS, while 2006 statistics were provided to CRS from DHS.
46 United Nations Office on Drugs and Crime (UNODC)and World Bank, “Crime, Violence,
and Development: Trends, Costs, and Policy Options in the Caribbean,” March 2007, p. 10.
crime.47 In Jamaica, government officials often link the criminal deportees to
criminal organizations and rising homicide rates in the country. Some Jamaican
politicians contend that the deportees learned their criminal ways in the United States
and that many have lived in the United States since they were young children. In
contrast, noted Jamaican criminologist Bernard Headley contends that the majority
of criminal deportees in Jamaica are not hardened criminals, and that a only minority
of deportees were raised in the United States at a young age.48
Caribbean officials have called on the United States to provide better
information on deportees with criminal records. Some have recommended that U.S.
law enforcement authorities share information on all Caribbean deportees, with the
goal of establishing a Deportee Databank for the region. Some Caribbean officials
have also called on the United States to reconsider the policy of deporting long-term
permanent residents, balancing such issues as the interests of children, the interests
of the individual, and the impact on both the United States and recipient countries.49
Caribbean leaders have also called for reintegration assistance to help returning
nationals, many who have spent many years away from their country. Speaking at
the June 2007 CARICOM meeting in Washington D.C., Jamaican Prime Minister
Portia Simpson Miller called for international assistance for rehabilitation,
reintegration into society, and mechanisms for effective monitoring.50 The U.N.-
World Bank study noted above maintained that assisting reintegration efforts in the
Caribbean for deported offenders could be a cost-effective way for deportee-sending
countries to promote development and weaken international criminal networks. The
study recommended improved coordination and information sharing on criminal
deportees by sending countries; robust research on the contribution of deportees to
crime; and the financing of deportee reintegration programs, including financial
support from sending countries.51
CARICOM issued a report on crime and security in 2002 recommending that
its member states establish offices for the resettlement of deportees, modeled after
such an office in St. Kitts and Nevis, that would provide temporary employment,
housing, and other services. Several countries in the region have established such
offices. Trinidad and Tobago, for example, established a Social Displacement Unit
within the Ministry of Social Development that assesses the needs and provides some
assistance to deportees.
47 Gary Marx, “New Life Is No Life for U.S. Ex-cons in Haiti,” Chicago Tribune, May 17,
48 UNODC/World Bank report, p. 88; Bernard Headley, “Giving Critical Context to the
Deportee Phenomenon,” Social Justice, Vol 33, No. 1, 2006; Marc Lacey, “No Paradise for
Criminals Deported to Jamaica,” New York Times, March 21, 2007
49 House Committee on Foreign Affairs, Subcommittee on the Western Hemisphere,
Testimony of Annmarie Barnes, Ministry of National Security, Jamaica, Hearing on
“Deportees in Latin America and the Caribbean,” July 24, 2007.
50 CARICOM Secretariat, Press Release 143/2007 (June 20, 2007), Address by the Most
Hon. Porta Simpson Miller, Prime Minister of Jamaica, Washington, D.C. June 19, 2007.
51 UNODC/World Bank report, pp. xvi and 81.
Table 8. U.S. Deportations to the Caribbean,
FY2005FY2006FY2007 (through June 18, 2007)
Bahamas 135 122 13 75 65 10 57 47 10
Barbados57 — — 4239325223
B e lize 178 121 57 167 108 59 117 72 45
Cuba 47 26 21 39 22 17 21 14 7
Do minica 24 17 7 21 14 7 25 22 3
Dominican 2,929 2,301 628 2,805 2,241 564 1,677 1,336 341
Grenada 38 27 11 25 20 5 17 15 2
Guya na 347 251 96 253 176 77 179 132 47
Haiti 1,088 584 504 814 296 518 783 372 411
Jamaica 1,777 1,480 297 1,426 1,249 177 823 709 114
St. Kitts and21 — — 24222651
cent and 38308181441073
Total: a a a
Ca ribbea n 7,159 5,315 1,766 6,100 4,567 1,533 3,981 2,951 1,030
Prepared by Nelson Olhero, Research Associate, CRS Foreign Affairs, Defense and Trade Division, utilizing
ation provided by the Department of Homeland Security, Immigration and Customs Enforcement, Office of Detention
he number of criminal and non-criminal deportees does not add to the sum total in FY2005 because no data distinguishing
ories is provided for Barbados and St. Kitts and Nevis in that year.
In 2006, the United States indirectly funded a $1 million pilot project in Haiti
through the United Nations Development Program and implemented by the
International Organization for Migration (IOM), which established a Haitian
government program providing services to deportees. The program, which began
operating in 2007 under the Haitian government’s Ministry of Social Affairs,
involves counseling, HIV/AIDS testing, a drug rehabilitation program, skills training,
and micro-enterprise support. State Department officials indicate that they are
hoping to use the program as a model for reintegration programs in other CARICOM
countries in the future.52
Caribbean Energy Security53
A major concern for Caribbean nations — the majority of which are net energy
importers — has been the rising price of oil and the potential effect of such rising
prices on economic growth and social stability. In the Caribbean region, only three
nations — Trinidad and Tobago, Cuba, and Suriname — have significant oil and gas
reserves.54 Of these, only Trinidad and Tobago is a major oil and gas producer.
With gas reserves of 19 trillion cubic feet — the fifth largest in the Western
Hemisphere — Trinidad is the largest supplier of liquefied natural gas (LNG) to the
United States, accounting for 75% of all U.S. LNG imports. It also produced an
estimated 150,000 barrels of oil per day in 2006. Both oil and gas reserves in
Trinidad have declined in recent years, putting pressure on exploration efforts in
order to sustain future production. Cuba produces oil, about 69,000 barrels of oil per
day, but still imports a majority of its consumption needs. Estimates of Cuba’s
offshore oil reserves, however, approach 5 billion barrels of undiscovered oil.55
Suriname produces about 12,000 barrels of oil per day. Barbados also produces a
small amount of oil, which is refined in Trinidad and Tobago, but it imports 90% of
its oil consumption needs.
Venezuela is now offering oil to Caribbean nations on preferential terms in a
new program known as PetroCaribe, and there has been some U.S. concern that the
program could increase Venezuela’s influence in the Caribbean region. Since 1980,
Caribbean nations have benefitted from preferential oil imports from Venezuela (and
Mexico) under the San Jose Pact, and since 2001, Venezuela has provided additional
support for Caribbean oil imports under the Caracas Energy Accord. PetroCaribe,
52 Testimony of Charles S. Shapiro, Principal Deputy Assistant Secretary of State, Bureau
of Western Hemisphere Affairs, House Subcommittee on the Western Hemisphere, Hearing
on “Deportees in Latin America and the Caribbean,” July 24, 2007; Eric Green, “Project to
Help Haitian Deportees Serves as Model for Caribbean,” U.S. Department of State,
International Information Programs, August 7, 2007.
53 For additional information, see CRS Report RL33693, Latin America: Energy Supply,
Political Developments, and U.S. Policy Approaches, by Mark P. Sullivan and Clare M.
54 “Caribbean Fact Sheet,” U.S. Department of Energy, Energy Information Administration,
55 Jorge Piñon, “Cuba’s Energy Future,” University of Miami, Cuba Transition Project,
Institute for Cuban and Cuban American Studies, May 2007.
however, goes further with the goal of putting in place a regional supply, refining,
and transportation and storage network, and establishing a development fund for
those countries participating in the program.
Under the program, Venezuela is offering to supply 190,000 barrels per day of
oil to the region on preferential terms. When oil prices are over $50 a barrel, 40%
of the volume is financed over 25 years at an annual interest rate of 1%. Cuba, a
major beneficiary of PetroCaribe, receives some 90,000 barrels per day (bpd) of oil
from Venezuela, while the Dominican Republic receives some 40-45,000 bpd and
Jamaica receives some 23,500. Fourteen Caribbean nations are signatories of
PetroCaribe. PetroCaribe also has the goal of putting in place a regional supply,
refining, and transportation and storage network, and establishing a development
fund for those countries participating in the program. Barbados, which already
receives discounted petroleum rates from Trinidad, has declined to sign the
agreement, and Trinidad, which has its own abundant energy resources, has declined
In the past, Trinidad’s Prime Minister Patrick Manning warned other
CARICOM nations that PetroCaribe could leave them dependent on Venezuelan
oil.56 Petrotrin, Trinidad and Tobago’s state-owned oil company reportedly is
looking for new oil markets outside the Caribbean to replace some markets lost to
Venezuela because of PetroCaribe. The company traditionally has sold about 60,000
barrels per day of oil to the region.57 More recently, Trinidad has increased its energy
cooperation with Venezuela. In March 2007, Trinidad and Venezuela signed an
agreement for the joint development of offshore gas blocks that lie in common
waters. Trinidadian Prime Minister Patrick Manning has suggested that the gas
produced from the joint endeavor should be processed in Trinidad because it already
has the infrastructure in place and well-developed LNG capabilities.58 Manning also
has proposed to both Brazil and Venezuela that the three countries cooperate in
building a second oil refinery in Trinidad and Tobago.59
The development of biofuels such as ethanol, produced from sugar, could help
some Caribbean countries reduce their dependence on imported oil. In March 2007,
the United States and Brazil signed an agreement to promote greater cooperation on
ethanol with part of the accord focusing on assistance for biofuels development in
several countries, including the Dominican Republic, Haiti, and St. Kitts and Nevis.
56 “Trinidad PM Says Venezuela’s PetroCaribe Scheme a “Direct Threat,” BBC Monitoring
Americas, September 6, 2006.
57 Linda Hutchinson-Jafar, “Rival Forces to Seek New Oil Markets,” Reuters News, March
58 “Jens Gould, “Venezuela, Trinidad Sign Gas Unification Agreement,” Platts Oilgram
News, March 22, 2007.
59 Juliette Kerr, “Prime Minister of Trinidad and Tobago Proposes New Refinery with
Support from Other Countries in the Region,” World Markets Research Centre, March 23,
In early August 2007, Brazil and Jamaica signed an agreements to help modernize
Jamaica’s sugar and ethanol sectors.60
Legislative Initiatives in the 110th Congress
Caribbean-American Heritage Month. H.Con.Res. 148 (Lee), introduced
May 14, 2007 and passed by the House on June 18, 2007 by voice vote, recognizes
the significance of National Caribbean-American Heritage Month.
Carribean Community. H.Res. 418 (Engel), passed (386-0) by the House
June 11, 2007; recognizes and welcomes the delegation of Presidents, Prime
Ministers, and Foreign Ministers from the Caribbean to Washington DC, and
commends the Caribbean Community for holding the conference on the Caribbean.
Education. H.R. 176 (Lee), Shirley A. Chisholm United States-Caribbean
Educational Exchange Act of 2007 — introduced January 4, 2007; reported by the
House Committee on Foreign Affairs July 23, 2007 (H.Rept. 110-254); and passed
(371-55) by the House on July 31, 2007 — would authorize assistance to the
countries of the Caribbean to fund educational development and exchange programs.
Energy. S. 1007 (Lugar), introduced March 28, 2007, would, among other
provisions: direct the Secretary of State to work with the government of Brazil and
other foreign governments in the Western Hemisphere to ensure energy security by
fostering the development of biofuels production, research and infrastructure; and
require a study and investigation from the Secretary of the Treasury regarding ethanol
imports from certain Caribbean Basin countries. S. 1106 (Thune), would extend the
additional duty on ethanol from January 1, 2009 to January 1, 2011, and require an
investigation into ethanol imports from certain Caribbean Basin countries.
Health and HIV/AIDS. H.R. 848 (Fortuño), introduced February 6, 2007,
would amend the State Department Basic Authorities Act of 1956 to authorize
assistance to combat HIV/AIDS in Antigua and Barbuda, the Bahamas, Barbados,
Belize, Dominica, Grenada, Jamaica, Montserrat, Saint Kitts and Nevis, Saint
Vincent and the Grenadines, Saint Lucia, Suriname, Trinidad and Tobago and
Dominican Republic. H.Con.Res. 166 (Lee), introduced June 7, 2007, would
support the goals and ideals of National Caribbean American HIV/AIDS Awareness
Day. H.Con.Res. 173 (Jones, Stephanie Tubbs), introduced June 21, 2007, would
support the goals and ideals of the First Summit of Caribbean Ministers of Health.
Jamaica. H.Con.Res. 16 (Lee), introduced January 5, 2007, would
congratulate Prime Minister Portia Simpson Miller for becoming the first
democratically-elected female Prime Minister of Jamaica and the first female
Jamaican head of state.
60 “Jamaica, Brazil to Deepen Cooperation,” BBC Monitoring Americas, August 11, 2007.
Passport Requirements. H.R. 2638 (Thompson, Bennie), the FY2008
Department of Homeland Security Appropriations Act, both the House and Senate-
passed versions have provisions that would delay the implementation of any plan for
passport requirements to no earlier than June 1, 2009. The House approved its
provision on June 15, 2007, when it passed H.Amdt. 291 (LaTourette), by a vote of
379 to 25, prohibiting any funds in the bill from implementing a passport requirement
plan under section 7209 of the Intelligence Reform and Terrorism Prevention Act of
2004. The Bush Administration opposes any provisions in the bill that would delay
implementation of the Western Hemisphere Travel Initiative to June 2009.
H.R. 1684 (Thompson, Bennie), Department of Homeland Security
Authorization Act for FY2008, passed (296-126) by the House May 9, 2007; Section
1124(a) of the House-passed bill would, among other provisions, provide that
citizens of the United States or Canada less than 16 years of age not be required to
present a passport when returning to the United States from Canada, Mexico,
Bermuda, or the Caribbean at any port of entry along the international land or
maritime border of the United States.
H.R. 1061 (Slaughter), Protecting American Commerce and Travel Act of
2007, introduced February 14, 2007, would: direct the Secretary of Homeland
Security to conduct a pilot program to determine if a state driver’s license may be
enhanced to satisfy the passport requirements of the Intelligence Reform and
Terrorism Prevention Act of 2004 (P.L. 108-458) for land and sea travel only;
provide that a U.S. citizen under 17 shall not be required to present a passport when
returning to the United States from Canada, Mexico, Bermuda or the Caribbean at
specified ports of entry; direct the Secretary of State to issue U.S. citizen applicants
a passport card that may be used for international travel although the Secretary may
limit the use of a passport card to only international land and sea travel.
Tax Havens. S. 396 (Dorgan), introduced January 25, 2007, would amend the
Internal Revenue Code to treat controlled foreign corporations established in tax
havens as domestic corporations, including those in several Caribbean states. S. 681
(Levin), introduced February 17, 2007, and H.R. 2136 (Doggett), introduced May 3,
2007, the Stop Tax Haven Abuse Act, would restrict the use of offshore tax havens
and tax shelters to inappropriately avoid Federal taxation. Of the 34 countries and
territories listed as “offshore secrecy jurisdictions,” 16 are in the Caribbean.
Trade. H.R. 762 (Fortuño), introduced January 31, 2007, would authorize
appropriations for FY2008 for voluntary contributions on a grant basis to the
Organization of American States to establish a Center for Caribbean Basin Trade and
to establish a skill-based training program for Caribbean Basin countries.
For Additional Reading
CRS Report RL33337, Article 98 Agreements and Sanctions on U.S. Foreign Aid to
Latin America, by Clare M. Ribando.
CRS Report RL33819, Cuba: Issues for the 110th Congress, by Mark P. Sullivan.
CRS Report RS21718, Dominican Republic: Political and Economic Conditions and
U.S. Relations, by Clare Ribando.
CRS Report RL31870, The Dominican Republic-Central America-United States Free
Trade Agreement (DR-CAFTA), by J. F. Hornbeck.
CRS Report RS21930, Ethanol Imports and the Caribbean Basin Initiative, by Brent
CRS Report RS20864, A Free Trade Area of the Americas: Major Policy Issues and
Status of Negotiations, by J. F. Hornbeck.
CRS Report RL32294, Haiti: Developments and U.S. Policy Since 1991 and Current
Congressional Concerns, by Maureen Taft-Morales and Clare M. Ribando.
CRS Report RL32001, HIV/AIDS in the Caribbean and Central America, by Mark
CRS Report RL33693, Latin America: Energy Supply Political Developments, and
U.S. Policy Approaches, by Mark P. Sullivan and Clare Ribando.
CRS Report RL33828, Latin America and the Caribbean: Issues for the 110th
Congress, coordinated by Mark P. Sullivan.
CRS Report RS22657, Latin America and the Caribbean: Fact Sheet on Economic
and Social Indicators, by Julissa Gomez-Granger.
CRS Report RL33162, Trade Integration in the Americas, by M. Angeles Villarreal.
CRS Report RL33200, Trafficking in Persons in Latin America and the Caribbean,
by Clare M. Ribando.
CRS Report RL32739, Tsunamis: Monitoring, Detection, and Early Warning
Systems, by Wayne A. Morrissey.
CRS Report RL32487, U.S. Foreign Assistance to Latin America and the Caribbean,
coordinated by Connie Veillette.
CRS Report RL33951, U.S. Trade Policy and the Caribbean: From Trade
Preferences to Free Trade Agreements, by J. F. Hornbeck.
CRS Report RL32014, WTO Dispute Settlement: Status of U.S. Compliance in
Pending Cases, by Jeanne J. Grimmett.