By Steve Schifferes BBC News Online, Washington

Colin Powell: US must not neglect Latin America

For the last 18 months, political leaders south of the US border have felt increasingly neglected by Washington as the war on terror, and then the war in Iraq, moved to centre stage.

The traditionally close relationship between the US and Latin America was put under further strain when Mexico and Chile refused to support the US call for a second UN Security Council resolution over Iraq, and only a few, smaller central American nations joined the "coalition of the willing" offering material support during the war.

Now the US seems to be mounting a concerted drive to revive its links with Latin America, culminating in a call for an interim Summit of the Americas by the end of the year.

But the task is complicated by continuing divisions within the Bush administration over its hardline approach towards Cuba and Venezuela.

Three in one

On Monday, at a conference of the business-led Council of the Americas, no less than three US cabinet ministers appeared to reassure Latin Americans that they were not neglected, and that they were not going to be the next victims of regime change.

Attorney General John Ashcroft told the audience that the US was "sensitive" to the charge of interfering with the internal affairs of other states and acted according to the principle of "mutual independent sovereignty" when dealing with negotiations on narco-trafficking and terrorism.

Treasury Secretary John Snow, who made his first trip abroad to Latin America last week, said that his economic counterparts were making "good progress, but the commitment to long-term progress has to stay in place".

And Secretary of State Colin Powell said that the people of the region had been promised much, "and if we collectively do not deliver, then democracy has no meaning, the free-market system has no meaning, and it is possible for us to go backward."

Deadlock over trade talks

For the United States and many of the business leaders, the most concrete sign of success would be progress on a Free Trade Agreement of the Americas, which was launched by President Bush with much fanfare at the Quebec Summit in 2001.

These negotiations are being held up by the opposition of Brazil, whose new radical government is demanding better access for its agricultural products before signing up to any trade deal.

The reluctance of the administration to push forward in Congress on the free trade agreement already negotiated with Chile is a further sign to Latin critics that what is needed is "deeds not words."

And the relative neglect of Argentina as its economic crisis spiralled out of control at the end of 2001 also sent a negative message which may only be repaired after the current elections.

The head of the Argentine central bank, Alfonso Prat-Gay, said that capital flows could overwhelm even a medium-size economy, and said that a reformed IMF had to play a more counter-cyclical role in helping out.

Immigration is another vexed issue, especially between the US and Mexico.

Mexico's President, Vincente Fox, came to office with the belief that he could cut a deal with President Bush improving the rights of Mexican immigrants to the US.

But the increased security concerns after 11 September ended those hopes, although Secretary Powell said that "America still believes in immigration" and will try to speed up border crossings.

Who's in charge?

The fact that the US State Department still does not have an assistant secretary for Western Hemisphere affairs is perhaps indicative of the problem.

The three people who have played this role all appeared at the conference - the acting assistant secretary, Kurt Struble; the hardliner nominated by the Bush administration but rejected by Congress, Otto Reich; and the new nominee, Roger Noriega, presently the US ambassador to the Organization of American States (OAS).

Last week the United States was thwarted in the OAS over a resolution condemning Cuba for human rights resolutions, and now Secretary Powell says the US is reviewing its whole policy towards Cuba.

Mr Reich is a strong supporter of tough sanctions towards Cuba, and also played an important role in tilting US policy towards the Venezuelan opposition last spring.

Many of the US businessmen at the meeting demanded that the US government protect their investments in Venezuela, which are now under threat in the economic and political crisis.

But with popular opinion in other countries like Brazil also running against the "Washington consensus" of free market solutions, the US must tread more carefully than before.

After a day of debate, which approach to take still seems to be open to question within the administration.