Obama faces skeptical leaders at Americas summit

U.S. President Barack Obama listens during his meeting with Brazil President Dilma Rousseff in the Oval Office of the White House in Washington April 9, 2012.

BOGOTA (Reuters) - Three years after being feted by star-struck Latin American leaders, President Barack Obama faces skepticism and disappointment at this week's Summit of the Americas for failing to meet promises of a new era in relations with the region.

Obama's first meeting with leaders from the hemisphere in Trinidad and Tobago at the height of his popularity included a vow to mend ties with Cuba and a photo-op handshake with Hugo Chavez, the Venezuelan president and pugnacious U.S. critic.

This year, Obama is more focused on re-election than foreign policy and is set to receive a grilling over contentious issues like the drugs war, Cuba and even U.S. monetary policy from heads of state eager to remind him that Washington is growing less relevant for the region.

"The deception and disappointment are quite real," said Hal Klepak, a Canadian history professor and Latin America expert. "The last summit's focus was the 'Obama show,' this time what we have are years of nothing happening."

A senior Obama administration official said the U.S. president goes to the weekend summit in Cartagena, Colombia seeking to boost trade and commercial ties, specifically in the energy sector at a time of high gasoline prices.

He is likely to focus on free trade deals with Panama and Colombia, approved by the U.S. Congress last year, which are seen boosting growth in both countries while also creating jobs at home.

Latin American leaders generally favor him winning a second term, analysts say, in part because of some of the hardline comments on immigration by the Republican presidential hopefuls. Mitt Romney, for example, upset some with remarks about immigrants facing "self deportation" because they can't find work.

But they are nonetheless set to press Obama on allowing Cuba entry into the next Americas summit and again challenge the 50-year-old U.S. trade embargo against the communist-run island. The embargo is widely seen within Latin America as an outdated Cold War-era policy.

And presidents spanning the political spectrum will push for a discussion of legalizing and reducing U.S. demand for illegal drugs, seeking to shift responsibility for the problem toward the world's top consumer.

"Colombia, and I myself, have put this issue on the table, because if there is any country that has suffered more from drug trafficking, that has shed more blood, it's Colombia," President Juan Manuel Santos, who is hosting the summit, said recently.

BETTER THAN BUSH?

Obama can ill-afford to entertain changes to policy on Cuba or the drug war because they might alienate him from middle-of-the-road voters who will be key for his re-election bid.

"This is the worst moment to be proposing issues to the Americans in the run-up to a difficult and problematic election for President Obama," said Andres Rozental, former deputy foreign minister of Mexico.

Republican critics have in the past said Obama's efforts at dialogue with Cuba and Venezuela compromised national security.

A senior administration official said Washington had already eased travel restrictions to Cuba, and was waiting for Havana to release political prisoners and improve political freedoms before taking further steps to ease relations.

Obama is still popular among Latin Americans. A 2011 visit to a slum in Rio de Janeiro, for example, brought throngs of screaming admirers.

That contrasts with the violent protests that met former President George W. Bush at a 2005 regional summit in Argentina, where leftist leaders sank a hemisphere-wide free trade deal being pushed by the United States.

"I think relations (with the United States) are better now, there is more dialogue between the presidents, and Obama has been more accessible," said Jeremiah Barbosa, 66, filling pastry dough with caramel in his small bakery in Bogota.

But that charm has worn a bit thin on policymakers.

Facing budget battles at home and what will likely be a decline in foreign aid to Latin America this fiscal year, Obama heads to Cartagena with few favors to offer.

Brazil is frustrated with loose U.S. monetary policy that has pushed a flood of capital into Brazil, driving up its currency and making its exports less competitive, and President Dilma Rousseff complained to Obama about it in a meeting at the White House on Monday.

An overhaul of U.S. immigration rules has all but fallen off the agenda in the Washington, frustrating Mexico and Central American countries as well as Latino voters in the United States.

Argentina and the United States are at loggerheads over trade restrictions and compensation payments to American investors. And China is an increasingly active investor and economic power in Latin America as U.S. influence wanes.

"The United States has historically wanted to be a policeman to the world, but in general it has struggled to do so," said Rozental. "I think it's going to be difficult for the United States to give Latin America the priority that it deserves."

(Additional reporting by Pablo Garibian in Mexico City, Laura MacInnis and Arshad Mohammed in Washington, and Julia Symmes Cobb in Bogota; Editing by Andrew Cawthorne and Kieran Murray)