President Barack Obama left an economic summit with pledges from European leaders of renewed urgency to tackle the continent’s sovereign debt crisis which threatens growth worldwide.
He carried back to the U.S. and his re-election campaign no clear accomplishment to show voters, as meetings with Russian and Chinese leaders didn’t produce a compromise on dealing with other international crises such as the violence in Syria or the Iranian nuclear program.
At a press conference concluding the two-day summit of the Group of 20 nations yesterday, Obama expressed confidence Europe will stop the continent’s spreading debt crisis. Euro zone leaders showed “a heightened sense of urgency” at the meeting, he said.
Over the next several weeks, European leaders will “paint a picture of where we need to go” and “take some immediate steps” to demonstrate resolve to financial markets, Obama said.
“If people have a sense of where they are going, that can provide confidence to break the fever,” he added.
The summit in the beach resort of Los Cabos, Mexico, was Obama’s last scheduled foreign trip before the U.S. election in November. The president devoted the trip to pressing foreign leaders to stimulate growth in the global economy and to take decisive action on the debt crisis.
“If fewer folks are buying stuff in Paris or Berlin,” he said, “that means that we’re selling less stuff made in Pittsburgh or Cleveland.” Weak growth in the U.S. economy, with unemployment remaining above 8 percent, is the main issue of former Massachusetts Governor Mitt Romney, the presumptive Republican nominee, to use against Obama.
After a victory in Greek elections on June 17 for political parties that support a European bailout and austerity plan, financial markets turned on Spain as the summit opened. Spanish 10-year bond yields leaped above the 7 percent level that pushed Greece, Ireland and Portugal to call for sovereign rescues for the first time since the euro’s creation.
U.S. Treasury Secretary Timothy Geithner said earlier in the day that European leaders will take steps in the coming days to help the region “grow faster.” He said the Europeans are trying to “design a framework” for “a stronger set of institutions,” including a banking union, in time for a European summit later this month. Geithner said a European Union summit on June 28-29 will be “critical.”
He said the Russian and Chinese leaders recognize the situation in Syria “does not serve their interests,” though he stopped short of saying they are ready to abandon Assad.
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