FACTBOX-Immigration, drug war key to U.S.-Mexico relations

MEXICO CITY May 19 (Reuters) - Mexico's President Felipe Calderon met with U.S. President Barack Obama on Wednesday to discuss bilateral problems like surging drug violence along the countries' shared border and a clampdown on illegal immigration in Arizona. [ID:nN18217972]

Calderon will be received at the White House with a rare state dinner in the evening and will address a joint session of Congress on Thursday.

Here are the issues likely to come up during the visit:

ARIZONA LAW

An estimated 10.8 million illegal immigrants live in the United States, most of them from Mexico and Central America, and a tough new state law in Arizona has brought the issue to the forefront of public debate. The law, which comes into force in July, requires state and local police to determine if people are in the country illegally, previously a function carried out by federal immigration police and some local forces.

Critics say the law is unconstitutional and a mandate for racial profiling. But a majority of Americans back the border state's crackdown, while just 25 percent support Obama's softer immigration policy which includes legalizing millions of unauthorized migrants, a recent survey showed. Obama has said he wants to begin work on immigration reform this year, although the issue has been overshadowed by healthcare and financial regulation.

DRUGS WAR

Mexican drug gangs are killing rivals in record numbers, mostly in the U.S.-Mexico border region. Nearly 23,000 people have been killed in drug violence since Calderon took office in Dec. 2006 and launched an army offensive.

Security worries hit Calderon's conservative party this week after a prominent politician and former ruling party legislator went missing near his ranch and blood matching his type was found by his abandoned car. The case has gripped Mexico with many fearing it is a sign that drug gangs could be directly targeting the government.

Obama backs Calderon's drug strategy, following through on a $1.4 billion U.S. aid package known as the Merida Initiative pledged by former President George W. Bush in 2007. Obama has promised to step up efforts to curb U.S. drug consumption as well as the southbound flow of guns and cash into Mexico.

But human rights groups have long raised concerns that Calderon's army-backed approach is putting civilians at risk as claims of abuses by soldiers have jumped in recent years. Human Rights Watch recently issued fresh criticism of Mexico for handling accusations of military abuses as serious as killing, rape and torture in closed military tribunals instead of civilian courts.

TRADE, CROSS-BORDER TRUCKING

Washington agreed under the North American Free Trade Agreement, or NAFTA, to allow Mexican trucks to haul goods on U.S. roads. But a spending bill passed by Congress and signed by Obama eliminated funding for a pilot program launched by the George W. Bush administration on safety concerns.

Mexico slapped retaliatory tariffs on $2.4 billion of U.S. products in March and accused U.S. lawmakers of bowing to protectionist pressures from union leaders. U.S. business groups say producers and farmers are suffering lost sales. U.S. Transportation Secretary Ray LaHood said this month the government will "soon" announce a plan to reopen the border to Mexican trucks, but gave no further details. [ID:nN06268452]

GULF OIL SPILL

Crude oil has been gushing unchecked from a ruptured well controlled by energy giant BP Plc (BP.L) about a mile (1.6 km) under the ocean's surface in the Gulf of Mexico, threatening an ecological and economic calamity along the U.S. coastline.

Reports of huge oil plumes in the Gulf -- including one as large as 10 miles (16 km) long, three miles (5 km) wide and 300 feet (90 meters) thick -- underscored the spill's environmental impact as the crisis drags on. Mexico's navy says the oil has not yet hit Mexican shores because of favorable ocean currents, but noted that once currents change in the next few months the risk of contamination would rise.

Mexico's Senate president Carlos Navarrete said Calderon and Obama would discuss the spill and how Mexico can protect its waters from the billowing oil. (Editing by Kieran Murray and Cynthia Osterman)