TORONTO—While the global economy pulls back from the brink of disaster, President Barack Obama joined the chorus of world leaders confirming that the direction they had set in the previous two G-20s was correct.
Speaking to reporters following the summit, Obama said the bold actions of world leaders have succeeded.
“We have forged a coordinated response to the worst global economic crisis in our time.”
“Economic retraction has given way to economic growth, trade that has plummeted has rebounded.”
But now, as some countries wrestle with dangerous debt levels and look to pull back stimulus spending, Obama said each nation must remain mindful of the fragile nature of the recovery, and balance spending cuts against the dangers of rising debts.
“We can’t all rush to the exits at the same time. So countries that have surpluses should think about how can they spur growth, and how can they spur demand. Not all of those involve stimulus.”
“Each country needs to recognize that the recovery is vulnerable and needs work to make it durable, but [they] also have to recognize that if markets are skittish about deficits, that will also undermine recovery.”
Obama said the United States came to Toronto with three specific goals: to make sure the global recover is strong and durable, to continue reforming the financial system, and to address a range of global issues affecting prosperity and security.
“We have made progress in each of these areas,” he said.
“Every economy is unique and every country will chart its own unique course but make no mistake, we are moving in same direction.”
But Obama said other countries couldn’t rely on American demand to “borrow and buy” the world’s way to prosperity.
The president singled out China as one country that the United States hopes more from. Obama said that the United States welcomed China’s promise to let the renminbi (RMB) have greater flexibility, and that its current value was an unfair trade advantage.
“We have been very clear to them that we don’t consider that acceptable or consistent with the principals of balanced and sustainable growth that were discussed in Pittsburgh and that all G-20 countries signed on to.”
But whether that flexibility was meaningful, remains to be seen, said Obama.
“We didn’t expect a 20 percent re-evaluation in a week. ... We do expect that as more and more market faces come to bear, given the enormous surpluses that China has accumulated, that the RNB is going to go up and it is going to go up significantly.”
The United States would be paying close attention to how things panned out over the next several months, he said.
“The United States can compete with anyone, as long as we have an even playing field.”
But currency was not the only matter. Obama said the United States also wanted to see China move on tariffs, intellectual property protection, state-owned enterprises, and state-owned banks that are subsidizing industry.
Global security
Obama also spoke about problems in the Korean Peninsula where a South Korean navy vessel was sunk by North Korea in March. He said the world had a bad habit of ignoring the ugly facts of North Korea’s actions, something that would need to end. He also reiterated the United States’ unwavering support for South Korean and Japan.
The president also spoke at length about Afghanistan, saying the dichotomized debate over whether to stay or leave wasn’t hitting the mark.
While some argue for leaving immediately to cut losses, and others say the United States should do whatever it needs to for however long it needs to, Obama said the United States would need to work to ensure the country did not become a base for future terrorist attacks and needs to help the young democracy mature.
As the third-poorest country in the world, with high illiteracy, it was going to take work to help Afghanistan succeed, he said.
Obama said he was optimistic that additional troops and the new U.S. strategy in Afghanistan would help, and that the successes and failures would be addressed as the strategy was reviewed.
“This is going to be tough, but what I expect is that by the end of this year, we will have seen progress on the strategy that was laid out.”
Speaking to reporters following the summit, Obama said the bold actions of world leaders have succeeded.
“We have forged a coordinated response to the worst global economic crisis in our time.”
“Economic retraction has given way to economic growth, trade that has plummeted has rebounded.”
But now, as some countries wrestle with dangerous debt levels and look to pull back stimulus spending, Obama said each nation must remain mindful of the fragile nature of the recovery, and balance spending cuts against the dangers of rising debts.
“We can’t all rush to the exits at the same time. So countries that have surpluses should think about how can they spur growth, and how can they spur demand. Not all of those involve stimulus.”
“Each country needs to recognize that the recovery is vulnerable and needs work to make it durable, but [they] also have to recognize that if markets are skittish about deficits, that will also undermine recovery.”
Obama said the United States came to Toronto with three specific goals: to make sure the global recover is strong and durable, to continue reforming the financial system, and to address a range of global issues affecting prosperity and security.
“We have made progress in each of these areas,” he said.
“Every economy is unique and every country will chart its own unique course but make no mistake, we are moving in same direction.”
But Obama said other countries couldn’t rely on American demand to “borrow and buy” the world’s way to prosperity.
The president singled out China as one country that the United States hopes more from. Obama said that the United States welcomed China’s promise to let the renminbi (RMB) have greater flexibility, and that its current value was an unfair trade advantage.
“We have been very clear to them that we don’t consider that acceptable or consistent with the principals of balanced and sustainable growth that were discussed in Pittsburgh and that all G-20 countries signed on to.”
But whether that flexibility was meaningful, remains to be seen, said Obama.
“We didn’t expect a 20 percent re-evaluation in a week. ... We do expect that as more and more market faces come to bear, given the enormous surpluses that China has accumulated, that the RNB is going to go up and it is going to go up significantly.”
The United States would be paying close attention to how things panned out over the next several months, he said.
“The United States can compete with anyone, as long as we have an even playing field.”
But currency was not the only matter. Obama said the United States also wanted to see China move on tariffs, intellectual property protection, state-owned enterprises, and state-owned banks that are subsidizing industry.
Global security
Obama also spoke about problems in the Korean Peninsula where a South Korean navy vessel was sunk by North Korea in March. He said the world had a bad habit of ignoring the ugly facts of North Korea’s actions, something that would need to end. He also reiterated the United States’ unwavering support for South Korean and Japan.
The president also spoke at length about Afghanistan, saying the dichotomized debate over whether to stay or leave wasn’t hitting the mark.
While some argue for leaving immediately to cut losses, and others say the United States should do whatever it needs to for however long it needs to, Obama said the United States would need to work to ensure the country did not become a base for future terrorist attacks and needs to help the young democracy mature.
As the third-poorest country in the world, with high illiteracy, it was going to take work to help Afghanistan succeed, he said.
Obama said he was optimistic that additional troops and the new U.S. strategy in Afghanistan would help, and that the successes and failures would be addressed as the strategy was reviewed.
“This is going to be tough, but what I expect is that by the end of this year, we will have seen progress on the strategy that was laid out.”
