President Barack Obama is poised to offer an olive branch to Cuba in an effort to repair the US's tattered reputation in Latin America.

The White House has moved to ease some travel and trade restrictions as a cautious first step towards better ties with Havana, raising hopes of an eventual lifting of the four-decade-old economic embargo. Several Bush-era controls are expected to be relaxed in the run-up to next month's Summit of the Americas in Trinidad and Tobago to gild the president's regional debut and signal a new era of "Yankee" cooperation.

The administration has moved to ease draconian travel controls and lift limits on cash remittances that Cuban-Americans can send to the island, a lifeline for hundreds of thousands of families.

"The effect on ordinary Cubans will be fairly significant. It will improve things and be very welcome," said a western diplomat in Havana. The changes would reverse hardline Bush policies but not fundamentally alter relations between the superpower and the island, he added. "It just takes us back to the 1990s."

The provisions are contained in a $410bn (£290bn) spending bill due to be voted on this week. The legislation would allow Americans with immediate family in Cuba to visit annually, instead of once every three years, and broaden the definition of immediate family. It would also drop a requirement that Havana pay cash in advance for US food imports.

"There is a strong likelihood that Obama will announce policy changes prior to the summit," said Daniel Erikson, director of Caribbean programmes at the Inter-American Dialogue and author of The Cuba Wars. "Loosening travel restrictions would be the easy thing to do and defuse tensions at the summit."

The entire reason for all the restrictions was to keep dollars out of the hands of one of the world's most repressive regimes. The Cubans crave hard currency since their peso has less value outside of Cuba than a used bubble gum wrapper. Raoul and Fidel can stay in power only as long as they can buy shiny toys for their loyal apparatchiks who maintain the police state. Obama is about ready to make it harder for Cuba to transition to Democracy once Fidel departs the scene.

Yes, but we will be more popular in Latin America - at least with those who don't value freedom.