US President Barack Obama said the Group of 20 nations still had a lot of work to do on the world economy and had not yet achieved a framework for balanced growth. Obama's comments, after a meeting with the president of G20 member Indonesia in Jakarta on Tuesday, came as China criticised US easy money policies and warned two days before a G20 leaders summit that Washington could destabilise the global economy and inflate asset bubbles.
-- Obama, Yudhoyono inaugurate a 'Comprehensive Partnership' "We still have a lot of work to do...one of the key steps is putting in place additional tools to encourage balanced and sustainable growth," Obama told a press conference with Indonesian President Susilo Bambang Yudhoyono.
"We have not yet achieved that balanced growth," Obama said, citing that some countries were intervening in currency markets to maintain an advantage, without naming names. The United States' ultra-loose monetary policy is sending a flood of cash looking for higher returns in emerging markets such as Indonesia, leaving them grappling with surging currencies that can hurt their exports, while the US wants China to let its currency rise faster to reduce Beijing's trade advantage.
Obama said G20 progress would not happen "all at once" and the US was not looking to contain China. "We want China to succeed and prosper. It's good for the United States if China continues on the path of development that it is on," he said. Obama and Yudhoyono inaugurated a "Comprehensive Partnership" that will include co-operation on climate, security and energy, though gave few details and did not announce specific investments other than $165 million from the US for Indonesian education.
Obama said Indonesia, Southeast Asia's largest economy, was a growing market that the US was focusing on as part of its drive to double exports, while Yudhoyono said he expected US investment to increase significantly in sectors such as geothermal power. Obama continued his discussions with Yudhoyono, along with wife Michelle, at a state dinner where he was to be served favourite dishes from his Indonesia childhood such as nasi goreng and bakso (fried rice and meatball soup).
Obama will also use his visit to reach out to the Muslim world. On Wednesday he will visit the Istiqlal Mosque, one of the world's largest, and give a major speech likely to focus on Indonesia's example to the world as a pluralistic country.