The $500,000 fund -- the first of its kind to be sponsored by Chile, according to an IADB spokesperson -- is intended to spur technological advancement in Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama and the Dominican Republic.

Chile's newfound interest in Central America is uncharacteristic for the South American nation, which historically has been less interested in building economic and political ties with its regional neighbors. Chile, instead, has turned to the world outside of Latin America, forging partnerships -- particularly with Asian nations -- to establish itself as a world player. And while Central American nations have hardly been big geopolitical players, the region's importance is emerging as it becomes the front line in the battle for political influence between the United States and the Latin American left.

Central American nations are important because of their U.S. relationships. The region's proximity to and relationship with the United States makes it a valuable location for economic and political ventures. As a transition zone between the United States and its ally Mexico and the rest of Latin America, Central America is an ideal spot for establishing regimes hostile to the United States or for exporting political agendas. U.S. President George W. Bush recently visited the region during a Latin America tour, stressing that the United States has not forgotten Central America, and promising increased aid.

But while Bush has talked about Central America, rival Venezuela has sought out a Central American presence via Petrocaribe -- a program in which Venezuela provides affordable crude to a list of several Caribbean and Central American countries regardless of market fluctuations. But oil is not all Venezuela is exporting; recognizing the political value of the tiny nations, Venezuelan President Hugo Chavez has focused on winning their allegiance, having already bought an ally in Nicaragua and continuing to use oil to push his agenda in Central America.

In addition to the region's political value, there are economic benefits for countries with commercial enterprises in Central America. Since the Central American-Dominican Republic Free Trade Agreement is in effect, there are significant trade benefits for exports. Brazil, in particular, is poised to take advantage of this on the ethanol front by announcing plans to establish an ethanol plant in Guatemala, thus circumventing a hefty tariff on Brazilian ethanol.

The reasons for the United States, Brazil and ideology-exporting nations such as Venezuela to seek involvement in Central America are clear; but the motivation for Chile's newfound affinity for the beleaguered region is less easily determined.

It is possible that Chile is merely seeking entry to a region more amenable to economic interaction than it has been in the past, regardless of other countries' regional ambitions. But for Chile, Central America is an easy entry into Latin America's geopolitical framework -- it benefits from relatively small amounts of aid and its political system is not strongly tied to right or left agendas. The region is in the position to be receptive to Chile's center-left, pragmatic politics, particularly when these politics are accompanied by much-needed aid.

Chile has long avoided involvement in regional politics in order to focus on national interests and promotion, and its new interest in Central America does not indicate an abrupt shift in that policy. However, a political battle has begun throughout the region and lines are being drawn. Though it is unlikely that Chile wants to help tip Central America politically toward either the radical left or the United States, it could very well be seeking a larger role in the geopolitics of the region.