Mandelson urges Obama to resist US protectionists

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The Business Secretary Peter Mandelson last night urged Barack Obama not to retreat into trade isolation and protectionism.

Mr Obama made protectionist noises during his campaign for the White House, promising voters he would do more than John McCain to safeguard American jobs from overseas competition, but the Government is hoping that in office he will prove to be more outward-looking than his predecessor.

Ahead of next week's emergency meeting of world leaders in Washington on the global economic crisis, Lord Mandelson said: "Mr Obama has a strong platform for launching a new drive for progressive world leadership. In my lifetime I have not known a time when this leadership is more needed."

Britain is pressing for a global trade deal to be hammered out which ministers believe could produce a £120bn a year boost to the world economy.

Lord Mandelson said he hoped the world leaders would produce a "strong signal of their commitment to intensifying negotiations and reaching agreement on a framework for a deal".

But he signalled his fears that the US could become a stumbling block to a deal, warning that the Obama administration would have to defeat the "isolationists and protectionists" on Capitol Hill. "The only way forward for the United States and for the world is if America thinks globally," he said. "Yet more trade barriers, for example, are not the answer."

Lord Mandelson added: "We want America to seize the opportunity of the Obama victory to reclaim its leadership in the world, but Mr Obama will never succeed if Congress forces the new president into isolationism and protectionism which forces America to turn in on itself."

He warned that Britain and Europe could not claim an exclusive relationship with Washington under Mr Obama, with the West needing to involve the "new powerhouses of the world as equal partners". He added: "To tackle climate change we have to strike a deal with China and India."

Following the new president's call for greater "burden sharing" by Western nations in world troublespots, he also argued that European nations would need to make a bigger contribution to peace-keeping commitments.