By Alister Bull and Matt Spetalnick
SANTIAGO (Reuters) - President Barack Obama called on Monday for a "new era of partnership" with Latin America as he acknowledged a sometimes troubled past between Washington and its neighbors in the region.
Following his weekend visit to Latin America's powerhouse Brazil, Obama laid out a vision for deeper trade, investment and political ties with an economically dynamic region where the United States faces growing competition from China.
"No region is more closely linked than the United States and Latin America," Obama told a news conference after talks with Chilean President Sebastian Pinera on a visit overshadowed by fierce U.S. and European air strikes against Libyan leader Muammar Gaddafi's loyalist forces.
Obama is struggling to balance his handling of world crises, including U.S. military intervention in a third Muslim country, with his domestic priorities of jobs and the economy considered crucial to his 2012 re-election chances.
In his Latin American policy speech, Obama hailed Chile's transition from military rule to stable democracy, suggesting it could serve as a model for countries in the Arab world swept by popular rebellions against autocratic rule.
Obama said he wanted to launch a new initiative with Latin America that would be a "two-way street".
"The thing that I'm most excited about is the fact that in a country like Chile, it's not just a matter of what we can give to Chile, it also a matter of what Chile can offer us," he said, although he conceded that relations with Latin America have "at times been very rocky and at times been difficult."
During the Cold War, Washington backed a series of right-wing dictatorships against Marxist rebels or left-wing groups in Latin America. They included the dictatorship of Gen. Augusto Pinochet in Chile.
Obama said the region, where economic growth has accelerated in recent years and democracy has taken hold following brutal civil wars in several countries, is now more important to U.S. prosperity and security than ever before.
"I could not imagine a more fitting place to discuss the new era of partnership that the United States is pursuing, not only with Chile, but across the Americas," he said during a trip billed by the White House as his signature first-term tour of the region.
But he cautioned that some leaders still cling to "bankrupt ideologies" and called on communist-ruled Cuba to respect human rights.
Pinera backed Obama's call for a new alliance but reminded him that Panama and Colombia are still waiting for long-promised free trade agreements with the United States.
Latin America was optimistic when Obama took office in 2009 that he would give the region the respect it feels it deserves due to its strong economic performance. But two years later there is a sense that relations have been neglected while Obama battles urgent domestic challenges and foreign wars.
In Brazil, Obama found himself in the awkward position of meeting a leader whose government had abstained in last week's U.N. Security Council resolution giving the go-ahead for the strikes on Libya.
(Additional reporting by Simon Gardner in Santiago, Editing by Kieran Murray)