Washington and Havana have signaled their readiness to talk to try to end half a century of ideological conflict, putting the issue center stage at the Summit of the Americas being held in Trinidad and Tobago.
Obama, who was due to speak at the opening of the three-day summit in Port of Spain, has extended a hand to communist-ruled Cuba, saying he wants to "recast" their hostile relationship.
Earlier this week, Obama relaxed parts of the 47-year-old U.S. trade embargo against Cuba.
Raising hopes of a possible rapprochement, Cuban President Raul Castro said in Venezuela Thursday his country was open for talks with the United States about "everything," including human rights and political prisoners in Cuba, although he also demanded respect for Cuba's sovereignty.
Before Obama landed in Port of Spain, White House spokesman Robert Gibbs urged Cuba to free political prisoners and stop imposing levies on cash remittances sent to the island by Cuban Americans.
"There are actions that the Cuban government can take beyond wanting to have any dialogue with the American government," Gibbs told reporters aboard Air Force One.
"They're certainly free to release political prisoners, they're certainly free to stop skimming money off the top of remittance payments. They're free to institute greater freedom of the press," Gibbs said.
Cuba has in the past angrily rejected any attempt to link an improvement in ties with Washington with internal reform, and Gibbs' comments were almost certain to inflame the debate.
Cuba is excluded from the Trinidad meeting of 34 leaders but regional heads of state, from Brazil's Luiz Inacio Lula da Silva to Venezuela's Hugo Chavez, have called on Obama to end the long-standing U.S. embargo on Cuba.
‘Our Backyard’
The U.S. president is proposing a new cooperative partnership with Latin America and the Caribbean, free from the ideological enmities of the past, to tackle the impact of the global economic downturn hitting the hemisphere.
But the debate over U.S.-Cuba relations, and over Washington's desire to link their improvement to a political opening in Cuba, could risk rekindling precisely the kind of ideological sensibilities that Obama wants to leave behind.
Hours before the start of the Trinidad meeting, Venezuela's Chavez and a group of like-minded leftist leaders, including Cuba's Raul Castro, rejecting the proposed draft declaration of the Americas summit.
They said the meeting offered no solutions to the economic crisis and "unjustifiably excluded Cuba".
Speaking in the Dominican Republic before flying to Port of Spain, U.S. Secretary of State Hillary Clinton said the region should seize the opportunity of Obama's presidency to improve cooperation. "Let's put ideology aside, that is so yesterday. Let's figure out how we're going to help people," she said.
"The United State wants to engage our hemisphere. This is our backyard," she added, using a term to describe the region which has riled some of its leaders in the past.
Earlier, she welcomed what she called Raul Castro's "overtures".
The issue of U.S.-Cuba ties is not on the formal summit agenda or included in the draft declaration, which proposes coordination to tackle the effects of the economic crisis.
Prior to Obama's arrival in Port of Spain, U.S. officials were struggling to prevent the debate over Cuba from becoming the centerpiece of the summit.
"People are focused on how do we deal with the economic crisis, how do we ensure that Latin America doesn't end up in another lost decade ... we're confident that that's going to be the principal issue of discussion at the summit," Obama's special assistant for Latin America, Dan Restrepo, told reporters in Mexico, which Obama visited on Thursday.
