Obama and the World

As the 44th President of the United States of America, Barack Obama has some tough decisions to make that could define the rest of his presidency. On his 101st day of office, he will be attending the April 30th Global Summit to help solve the global economic crisis currently in the midst. His decisions will not only impact America's standing in the world, but will decide the fate of several developing and underdeveloped countries who have been hurt by the crisis as well.

Many world leaders are hoping for the new president to work with them in creating more regulation in the world market and a better system for dealing with development aid going into Third World countries. President Bush strongly believed in the free market during the November 2008 summit and continued defending it to the very end, with some compromises. Overall, few decisions were made, with rich countries promising to provide fiscal stimuluses if they could afford to do so. The G20, group of leaders from the twenty most powerful countries, agreed to begin the stalled Doha Round of global trade talks by the end of the year and countries should to employ protectionism. For his part, President-elect Obama remained away from the Summit, stating that America only has one president at a time. Instead, he sent two former secretaries of state to the meeting to gather information.

Although no one is sure of how Obama will address the world leaders because he has no history or such decisions. However, as part of his presidential campaign he did state in the senate that he would double development funding to Africa by 2012. His stand on regulation in the American economy might make him open to reforms in the World Bank and International Monetary Fund to make them more transparent and provide for greater input from Third World countries.

This would be a major improvement for most developing countries, allowing their governments more power in deciding what their people actually want and need, instead of receiving funding that only increases their difficulties. More regulation on the world market may also serve to create better working conditions for laborers in most of the Third World if seen through properly. There is also a down side that too much regulation may slow down the free market economy, preventing us from getting out of the economic crisis. It will be part of Obama's challenge to decide how much regulation is enough.

Currently, the richest countries which make up about 5% of the World Bank have most of the power, while the rest of the countries that make up 95% of the institution and have very little power. China and India both complained about this during the November 2008 Summit. India said that the G7 is no longer a sufficient group to deal with world problems, and the structure needs to change to reflect economic realities. China also wants more regulation.

The Washington Post has stated that “China got a promise of a bigger role for developing countries in global finance. Beijing had been pushing for developing countries to have more influence at the IMF and other global bodies, and its foreign ministry called the summit an "important and positive" step toward "the reform of the international financial structure."

Let us hope such change continues.