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President Obama Returns From Asia

posted Mar 29, 2011, 7:32 PM by Golden Knight

Posted in Spectrum

By Marc Magallanes


Photo Courtesy: Associated Press

To President Barack Obama, there is no place like home. He wrapped up a 10-day Asian tour on November 12, starting in India and ending with a two day summit in Seoul, South Korea with the Group of Twenty. There, he hoped to assist in turning the ailing world economy around while promoting American interests, but instead faced a tough job to ensure economic security while playing nice with other nations.

 President Obama spoke bluntly on America’s trade imbalance with big exporters, most notably China and Germany. He accused the Chinese government’s policy to artificially devalue its currency as “an irritant to the United States, a lot of China’s trading partners and those who are competing with China to sell goods around the world.” China’s policy to devalue its currency is seen as insensitive to the global community due to its effect of making Chinese goods cheaper and effectively making American goods less competitive in the global market. Mr. Obama said it is a mistake to think that “their path of prosperity is paved simply with exports to the United States.” China countered by saying that the United States artificially devalues its currency through the stimulus packages injected into the economy. This tough language spoken by both nations adds tension to Chinese territorial disputes between its East and Southeast Asian neighbors that the United States is supposed to mediate.

The leaders of the Group of Twenty economies agreed to curb “persistently large imbalances” in trade, saving, and spending. The group agreed that it is no longer feasible for the United States to constantly consume and China and Germany to consume very little. The compromise did not meet American goals on trade surpluses and deficits with the leaders deciding to leave much of the work on future meetings. Mr. Obama acknowledged that, “Instead of hitting home runs, sometimes we’re going to hit singles. But they’re really important singles.” The leaders agreed to “move toward market-determined exchange-rate systems,” to avoid trade and currency wars.

President Obama is glad to be back in the United States, where he will have face down the new Republican dominated House of Representatives. There’s no place like home.