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SEOUL, South Korea — President Barack Obama was meeting Thursday in Seoul with his South Korean counterpart, Lee Myung-bak, to haggle over details of a free-trade deal between their two nations, officials said.
On the sidelines of the G-20 summit, Obama and Lee were said to be working on final negotiations, which got stuck in lower-level meetings on the issues of beef and autos, sources said.
The two leaders earlier this year set a deadline of resolving remaining concerns by the summit. Trade officials are tight-lipped about the fate of the deal, refusing to say if the drawn out negotiations between working-level officials had resolved outstanding issues.
"As we have said previously, if we can reach the standard for a fair trade agreement that the president has set out on particularly autos, we will move forward. We hope to continue making progress," a White House official said.
South Korea's Yonhap news agency quoted a senior government official as saying things were looking very difficult.
"We can't rule out the possibility that we won't reach a complete agreement today and will have to continue discussions," said the official.
The deal, signed in 2007, has been criticized in the United States for not doing enough to open South Korean markets to U.S. cars and beef. It remains unratified by lawmakers in both countries, and trade between the nations has slipped.
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A failure to resolve differences could embarrass Obama, who, coming off a mid-term election setback last week, hoped to advance the pact and send a signal on U.S. commitment to greater trade.
On Wednesday, Obama told global leaders the burden is on them as well as the U.S. to fix trade-stifling imbalances and currency disputes that imperil economic recoveries everywhere. The president promised the United States would do its part but declared "the world is looking to us to work together."
On the eve of an economic summit, Obama landed in Seoul hoping to close an elusive trade deal with South Korea, the kind that could potentially mean jobs and markets for frustrated businesses and workers back home. Yet the deal was still in the balance in the last hours, slowed by U.S. demands over South Korea's auto trade and its market for American beef.
Obama was also to make his economic case directly to Chinese President Hu Jintao after lavishing attention on China's rising rival, India, for three days. The U.S. and China enjoy an economic partnership but continue to clash over currency, with the U.S. contending that China's undervalued yuan gives it an unfair edge in the flow of exports and imports.
The U.S. president made the point again in a letter to fellow leaders gathered here for the G-20 summit of established and emerging economies. Warning of unsustainable balance sheets, with some countries holding surpluses and other swimming in debt, Obama pushed for exchanges rates based on the market and no more "undervaluing currencies for competitive purposes."
In less than two years on the job, Obama has become a familiar face at such summits, a sign of the enormous global effort to contain and reverse economic erosion.
He shows up this time on the defensive about the recent $600 billion intervention by the U.S. Federal Reserve, and weakened by a congressional midterm election that will give much greater power to the opposition Republican Party.
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Obama's message is that the United States cannot be the world's consumer, propping up others by borrowing and spending. He is pitching for a balanced recovery across the globe — tougher to achieve when national interests collide.
"The foundation for a strong and durable recovery will not materialize if American households stop saving and go back to spending based on borrowing," the president wrote.
Story: Palin, Germany, China: Odd trio of Fed critics Story: Obama to Muslims: Look beyond 'mistrust'Ahead of his trip, the Federal Reserve announced plans to purchase $600 billion in long-term government bonds to try to drive down interest rates, spur lending and boost the U.S. economy. Some other nations complain that gives American goods an unfair advantage in competition with theirs.
Already pressed about that once on his trip to Asia, Obama said the Federal Reserve acts independently, but he still threw support behind the action. "I will say that the Fed's mandate, my mandate, is to grow our economy," Obama said. "And that's not just good for the United States, that's good for the world as a whole."
The president came into Seoul quietly on Wednesday night after his latest long flight across Asia, this one from Indonesia, where he had given a speech renewing his outreach to the Muslim world. His upcoming agenda is packed with economic sessions and one-on-one meetings, in South Korea through Friday and this weekend in Japan.
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Obama will meet with Lee and German Chancellor Angela Merkel before the G-20 gatherings begin late in the day.
No longer in the emergency mode of preventing economic collapse, the leaders are seeking ways to sustain reliable growth and speed up the creation of jobs for their people.
Obama defends the drastic actions the U.S. has taken on its own and with others to prevent further economic calamity, well aware of how anxious Americans are for new jobs and confidence.
Earlier Wednesday, Obama was in Jakarta, the capital of the world's most populous Muslim nation, issuing a call for trust and cooperation. He lived in Indonesia as a boy from 1967 to 1971 and found himself flooded with memories.
"Let me begin with a simple statement: Indonesia is part of me," he said in Indonesian language, drawing cheers from the audience of more than 6,000 mostly young people at the University of Indonesia. Obama took care in his remarks to note that he is Christian; back home in the U.S., he continues to fight erroneous perceptions that he is Muslim.
Reuters and The Associated Press contributed to this report.
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