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Following Obama through India, Indonesia and South Korea

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On his ten day trip to Asia, the US President Barrack Obama is encouraging the world to build more just societies. Primarily seen as an attempt to garner support from the growing economies in Asia, Obama through this commission is sending a message to the world that the next generation’s economy will be built on access to information and not on arsenals of arms. In India, the President spoke in clear terms that he supports India to be a permanent member of the United Nations Security Council. Even though it appears bleak (Obama is an optimist!) he has made an attempt to start negotiations on how to enlarge the UNSC to oversee its activities. Besides India, other potential UNSC candidates are Germany, Italy, Brazil and South Africa. It will be a fierce negotiation and possibly an expansion of permanent members without veto powers. Obama also emphasized the need to cut US trade deficits with India. He encouraged Indian investment in the US. Outsourcing jobs to India is helping the Indian economy to grow and president Obama suggested that India should reciprocate by investing in the US market.
In Indonesia, the president underscored his interest in amending foreign policies. His attempts to make the growing economies allies were made clear by his disapproval of Israel’s decision to build new housing units in East Jerusalem. US foreign policies have long focused on a handful of countries like Israel in the middle East, which the president is attempting to restructure. In the trip cut short by the volcanic cloud movement, Obama reiterated that an arms race is not the right way to propel economies. Obama’s leniency towards reforming foreign and security policies is worthy of applause. In the world’s largest Muslim country, Obama urged the building of a more peaceful and just world. Obama appealed to the world to build more robust and global economies. Religious choice is an individual’s choice but equity and justice is universal, Obama emphasized. The approval of new construction can be expected to slow down the brewing peace negotiation between Israelis and the Palestinians that was started in Washington DC this past September.
As Obama arrived in Seoul for the G20 Convention, his economic strongman’s (Timothy Geithner) proposal to restrict trade surplus to a factor of a nation’s gross domestic product elicited derision from the German Chancellor. Angela Merkel boldly dismissed the idea. The Obamas administration’s proposal to spend another 600 billion dollars in stimulus has been sharply criticized by other G20 members too. The proposal is not popular in the US either. As China appears not to budge from its stance on appreciating renminbi, the US economic policies have come under scrutiny. Meanwhile, the possibility of inking a new trade agreement with South Korea is not galvanizing the visit any more. More agenda’s and clauses can be expected to be tabled before a new trade accord.
As long as China’s devaluation of its currency continues and the big consumptive economies’ trade deficits increase, the global economy will not be stable. A prolonged state of global economic instability affects all countries including the most aloof ones. It is imperative that the US economy gain ground. Possibly another borrowed stimulus can be avoided but the role that the US economy plays to regulate worldwide economy must be duly acknowledged. Debt-laden stimulus, and the quantitative easing that the US is attempting though might not be the best option but is still attractive in the backdrop of Chinese authority not making any attempts to appraise renminbi. The US is still the world’s largest economy by far. China is a growing economy sustained by the consumptive behaviors of the western economies. Even though there are ample opportunities for growing economies like China and India to penetrate into the developing or underdeveloped economies it is less likely that such an approach will be beneficial in the short term and sustainable in the long.

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Written by shashidhungel

November 11, 2010 at 1:44 pm