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Posts Tagged ‘Barack Obama’

The world financial leaders meeting on Thursday (04/14), when the discomfort will high oil prices, unsustainable debt burden and the future uncertain for Japan’s global economic outlook.
Will Discuss Global Issues G7, G20 Discover Imbalance

G7 Finance Minister and Governor of the Bank held a meeting at the Congress Center Istanbul, October 3, 2009.

The members of the G7, which performs in a closed meeting on this night, will try to assess the economic damage from the Japanese earthquake and the revolt in the Arab world.

“There is a very high uncertainty about the Japanese view,” said Naoyuki Shinohara, deputy director of the International Monetary Fund (IMF).

G20 club of developed and developing countries will hold a working dinner to encourage plans to build a more stable global economy less vulnerable to explosions and the breakthrough that marked the last two decades.

G7 is expected to release a statement on Thursday, while G2O will release at its meeting on Friday.

The best clue to the agenda on Thursday could be included in a public statement by U.S. Treasury Secretary Timothy Geithner and French Finance Minister Christine Lagarde. French entry in this year’s G20.

G20 has become a major forum to find out how to ensure no repeat of the 2007-2009 financial crisis, which triggered the worst global recession since World War II. G20 leaders agreed in 2009 to shrink the imbalance between rich countries such as China’s exports and economic burden of consumer debt, including the United States, which many economists blamed for contributing to the crisis.

However, in line with world economic recovery, the G20 has found it increasingly difficult to forge consensus on how to get out of the imbalance. Financial leaders expected to finish the job “indicative guidelines” to find potential trouble spots, identify the specific countries despite conflict with rules that will come later.

United States and China would almost certainly be on top of that list, but may also include surplus countries such as Germany and the debtor such as the UK.

The IMF, which hold two annual meetings this weekend, has warned the G20 to be less satisfied at this time despite the acute phase of the financial crisis has passed.

“We understand that negotiations on the G20 is much more difficult now than during the crisis,” said Olivier Blanchard, IMF chief economist.

“Each country has its own agenda. They do not always match. So if there is impatience? No, but we continue to think that it is an important part of what it takes to get back to recovery.”

Reducing government debt in the developed world is part of IMF recommendations for recovery. The funds caused a stir earlier this week when it said that the United States will have trouble against the objectives of the G20 meeting of halving the deficit by 2013.

The U.S. Treasury Department confirmed that Washington would meet its commitments. President Barack Obama gave his plans on Wednesday to reduce the deficit of U.S. $ 4 trillion over 10 years.

President Barack Obama said during the visit of Chinese President Hu Jintao on Wednesday (19/01), that China’s currency undervalued and should be increasingly driven by the market.
Obama: Chinese Currency Undervalued

U.S. President Barack Obama welcomed Chinese President Hu Jintao in a formal ceremony Hu’s arrival in the South Lawn at the White House, Washington, January 19, 2011.

Obama stated in his opening address a joint press conference, where one of the major disputes between the two countries under Washington’s response that the Chinese yuan is not sufficiently valued and harm the U.S. economy as a result.

Obama returned to the topic in response to questions from reporters.

“I told President Hu that we welcome China’s increasing flexibility of its currency. But I also must say that the (yuan) remains the renminbi is undervalued, so need no further adjustment in the exchange rate,” he said.

Obama said he told Hu that the yuan policy change “can be a powerful tool for China to increase domestic demand and reduce inflationary pressures in their economies.”

“So we will continue to look for the value of Chinese currency to be increasingly driven by the market, which will help ensure that no nation that has undue economic advantage,” he said.

But Obama said later that the currency was only part of the US-China relations in the wider economy.

“The currency is part of the problem. Renminbi is undervalued. The Chinese government has made a very strong intervention in currency markets,” Obama said, calling that an indication of an undervalued yuan.

Hu Obama acknowledged concerns about the disruption in the export market of currency movements are too fast, but he was confident of progress toward market-based yuan.

Hu said the two leaders discussed the disagreements on economic issues and trade.

U.S. Export Transaction and China U.S. $ 45 Billion

United States and China reached agreement on export transactions valued at U.S. $ 45 billion, including major contracts for Boeing aircraft, the White House said at the beginning of the formal state visit by Chinese President Hu Jintao on Wednesday (10/01).
U.S. Export Transaction and China U.S. $ 45 Billion

U.S. President Barack Obama (R) and Chinese President Hu Jintao shake hands at the end of a joint press conference at the East Room at the White House, Washington, January 19, 2011.

Agreement including the approval of China’s final contract amount of U.S. $ 19 billion to buy Boeing 200 aircraft for delivery between 2011 and 2013, an estimated U.S. officials would support 100,000 American jobs.

“We appreciate China’s support for our products and confidence in the Boeing,” said Jim Albaugh, CEO of Boeing Commercial Airplanes. “With the tremendous support provided by the Government of the United States, the deal is a win-win partnerships that approach Boeing-China’s 40th birthday.

Other transactions, including Honeywell, Caterpillar and Westinghouse Electric, as well as a unit of Toshiba Corp of Japan.

Chinese officials told the Obama administration that the Chinese company has signed 70 contracts worth U.S. $ 25 billion in U.S. exports from 12 states, U.S. officials said.

Overall, Boeing and other transactions will support the work in the U.S. are estimated to be about 235 000 people, they said.

The agreement came at least partly intended to address criticism that China is not playing the U.S. with rules such as the economic power of the masses and using a number of policies to maintain a large trade surplus with the United States.

Although China is one market the fastest-growing exports to the United States, which overshadowed by imports from China reaching about U.S. $ 370 billion in 2010.

The U.S. trade deficit with China is estimated at U.S. $ 275 billion last year, which will be a new record.

The senior U.S. official, who told reporters on condition of anonymity, said there was also progress in several key areas in the trade, including intellectual property, indigenous innovation and government procurement.

Orders of U.S. $ 19 billion to Boeing would be greater than the agreement of U.S. $ 15.6 billion for Airbus to sell 180 aircraft to the Indigo, India’s budget carrier. The agreement was announced on January 11 last, which is touted as the largest jet order in aviation history.

While U.S. imports fell by 0.8%, helped by lower oil prices, the decline wasn’t nearly enough to offset the much bigger export-drop. “The real weakness was in exports and that’s consistent with slower growth in the rest of the world,” Jay Bryson, a global economist at Wells Fargo Securities LLCinCharlotte,North Carolina, told Bloomberg News. “The contribution of exports [to growth] is going to be a little more shaky.” Exports, which make up about 13% of the U.S. economy, have contributed a greater-than-usual share to the recovery. Commerce Department data estimated that exports contributed 0.6% of the second quarter’s total 1.3% increase in GDP. That exports dropped despite a weak dollar, which makes U.S. products cheaper overseas, cast a further pall on the news. A decline in the dollar of 7.8% in the 12 months that ended in July wasn’t sufficient incentive for foreign buyers. The widening U.S. trade deficit also presents another headache for U.S. President Barack Obama, who has said that increasing exports is part of his strategy to revive the economy and create jobs. “To help businesses sell more products abroad, we set a goal of doubling our exports by 2014 –because the more we export, the more jobs we create here at home,” President Obama said in his 2011 State of the Union address. At their current numbers, U.S. exports have increased by about one-third of where they were in January 2009, when President Obama was inaugurated, but a continued decline will make it much harder to reach the goal of doubling exports by 2014. The fresh pressure on exports could create renewed urgency for Congress to pass pending free trade deals with South Korea, Panama and Colombia. Those deals have faced opposition from labor unions, who say the deals will cost more jobs than they create and will make the widening U.S. trade deficit even worse. “All we hear is about the export jobs being created,” Robert Scott, international economist for the Economic Policy Institute,told CNN Money. “The problem is they count the home team’s score and leave off the visitors’ score. The results of other trade agreements have shown these deals tend to result in growing trade deficits with these countries.” The widening U.S. trade deficit added to the stew of other recent negative reports, which has led many analysts to lower their GDP estimates for the rest of 2011. Back in April most forecasts were for growth above 3%; now most see only 2% growth, which is not sufficient to turn the U.S. economy around. After the report was released, many economists quickly adjusted their growth estimate for the quarter below 1%. Barclays Capital said it had lowered its 2Q GDP estimate to 0.6%. Economists estimate that every $1 billion added to the U.S. trade deficit shaves 0.1% from the annualized GDP.