ANTIGUA GUATEMALA, GUATEMALA, JUNE 18 -- Secretary of State James A. Baker III assured Central American presidents today that Washington would press Japan and Western Europe to increase their assistance to the region at a time of declining U.S. aid to most Central American countries.
Although the United States recently sent an aid package worth $720 million to rebuild the ruined economies of Nicaragua and Panama, U.S. economic assistance to the other Central American nations -- Costa Rica, El Salvador, Guatemala and Honduras -- dropped by about 20 percent this year.
The region's presidents, meeting in this cobblestoned colonial capital on a rescue mission for their war- and debt-shattered economies, have stressed that no combination of steps they could take would be sufficient to lift the region from its poverty without new infusions of cash from industrialized nations.
Baker, who arrived in Guatemala Sunday night and met individually with the six presidents today, is proposing an international effort by wealthy nations and international lending institutions to help Central America. The approach is patterned on the Group of 24 industrialized nations that was formed last year to rebuild Poland and Hungary and has since been expanded to address the needs of other Eastern European countries.
"We . . . recognize that there are fears in Central America that the United States and the industrial democracies will be diverted by the changes in Eastern Europe and ignore this region at this moment of historic opportunity," he said. "I'm here today at the request of President Bush to make it very clear that the United States will be fully engaged and fully supportive of this regional peace process."
Although the presidents expressed some doubts about the structure of the new aid mechanism and conditions that might be attached to new assistance, the general response to Baker's proposal was positive.
"The United States is taking the lead in getting the world to give aid to Central America," said Costa Rican President Rafael Calderon. "We all celebrate that."
Nicaragua has already been the beneficiary not only of some $330 million in direct U.S. aid, but also of a $300 million aid package pledged earlier this month in Rome by a group of 34 donors, including the 12 European Community countries, the World Bank and the International Monetary Fund.
The 34 donors also pledged an additional $180 million for Nicaragua in 1991, a sum that would include food aid and help to reduce Managua's balance-of-payments deficit.
Baker did not mention how much aid for Central America might be generated by his plan. Essentially, however, the idea seems to hold out the still vague promise of doing for the rest of Central America what the industrialized nations appear to be doing already for Nicaragua.
The proposal comes as Central America's presidents -- all of them democratically elected and oriented toward free-market economies -- are expressing optimism that the region has passed through a decade of violence and instability and is ready to address long-range challenges of underdevelopment and poverty.
Two-thirds of the 30 million people in the region live in poverty, and perhaps half of the poor are considered severely impoverished -- that is, unable to provide themselves with a normal daily diet.
The region's leaders, plainly worried that tenuous steps toward regional peace are threatened by poverty and stagnation, proposed on Sunday a broad program of regional cooperation in trade, production and expansion of infrastructure.
One effect of the plan would be to resuscitate the Central American Common Market, launched in the 1960s but a victim of wars and rivalries in recent years.
In addition to reassessing tariffs, cutting border restrictions for goods and people and eliminating other barriers to free trade, the five presidents called for a unified approach to rebuilding the region's transportation, communications and energy resources and creating a regional foreign service to attract new investment and tourism.
They further proposed the development of coordinated industrial and agricultural policies to guide regional production. And they instructed the region's economic planners to establish a forum to examine ways of easing the region's $20 billion debt.
Baker hailed the plan and called the summit a "historic . . . symbol of changes that are transforming this region." However, after a decade in which the United States has spent hundreds of millions of dollars to finance wars that had a devastating effect on the region's economies, U.S. aid to most of the countries on this isthmus is beginning to slip just as they seem on the verge of pacification.
Combined U.S. economic aid to Costa Rica, El Salvador, Guatemala and Honduras fell to $565 million in fiscal 1990 from $702 million last year -- a reduction of about 20 percent.
The region's leaders have expressed anxiety that the "peace dividend" that has permitted U.S. funds originally intended for the Pentagon budget to be diverted to help Nicaragua and Panama will not be repeated in the rest of Central America.
Baker and other U.S. diplomats reassured the presidents that the proposal to organize wealthy nations to assist Central America would result in an aid package that would supplement -- not replace -- current U.S. bilateral aid programs.
Salvadoran President Alfredo Cristiani said, "From our perspective, we look with . . . pleasure and with hope on the possibility of aid that would complement that which already exists bilaterally and multilaterally."
However, some aspects of the proposal seemed to touch regional sensitivities. In particular, several leaders expressed reservations about an outline of the proposal floated recently by Deputy Secretary of State Lawrence S. Eagleburger.
Eagleburger suggested that the organization's co-chairs be the United States, Japan and Eastern Europe, with the secretariat to be located in the United States. He added that "we would consider inviting a Latin nation," such as Venezuela, also to serve as a co-chair.
Guatemalan President Vinicio Cerezo said that if an international mechanism is created to help Central America, the leadership of such an organization should "fundamentally" come from the region itself.
U.S. officials, aware that the idea for a U.S.-based secretariat had not been enthusiastically received, stressed that the structure of the new organization had not been determined.
There also were concerns that the new aid would come heavily conditioned. Baker acknowledged that it would be intended to support human rights, democracy, development and disarmament and that deviations from those goals in the region could cloud prospects for the flow of aid.
Baker also said "it would be nice" if the Soviet Union continued supporting Nicaragua under the conservative government of President Violeta Chamorro as it did under the revolutionary rule of president Daniel Ortega.