Obama starts his second term on the eve of Israel's Jan. 22 elections and with Palestinians vowing to ask the U.N. General Assembly to recognize an independent state of Palestine — a move opposed by the U.S. as well as Israel, which favor negotiations. The Palestinians, in congratulating Obama on his re-election, urged him to support their U.N. appeal, but the American ambassador to Israel rejected that course.
If Prime Minister Benjamin Netanyahu is returned to the helm, as expected, some analysts expect Obama — who had frosty relations at best with the Israeli leader — might be freed in a second term to pressure Israel to make painful overtures to the Palestinians. The Palestinians have refused for four years to negotiate without a settlement freeze.
Obama's re-election averts the immediate prospect of the United States designating China a currency manipulator, which Romney had promised to do on his first day in office. That would have been a setback to relations and could even have triggered a trade war between the world's two biggest economies.
During his first term, Obama stepped up trade complaints against China but also sought to deepen ties with Beijing to diminish the prospects of a confrontation with a Chinese military that is starting to challenge U.S. pre-eminence in the Asia-Pacific.
This week, China embarks on its own once-in-a-decade leadership transition that will be critical in setting the tone for relations between the powers in the years ahead.
The run-up to the Communist Party Congress, which opened Thursday, has seen an escalation in tensions between China and Japan over disputed islands in the East China Sea. The U.S. has a treaty obligation to help Japan if it is attacked — a scenario Washington is eager to avoid.
Obama will be looking to reassure China that the U.S. does not seek to block its rise as a global power but will also be pressing it to abide by international norms. A strident nationalistic tone in China's state rhetoric in its dispute with Japan has fueled concerns that China's new leaders could increasingly resort to such patriotic appeals if the nation's juggernaut economy slows and public dissatisfaction with the Communist Party grows further. That heightens the risk of a more adversarial relationship between the U.S. and China.
During his first term, Obama made improving relations with Russia a priority. His so-called reset policy yielded dividends, including a major nuclear arms control pact, Russia's entry into the World Trade Organization and Russian help with the U.S. war in Afghanistan.
But as he moves into his second term, Obama's Russia policy could take a bumpy turn. Among the areas of contention: Russia's backing of Assad's regime in Syria and opposition to increased Western sanctions on Iran.
In March, Obama was caught on a microphone telling then-President Dmitry Medvedev that the U.S. would have more flexibility to work on missile defense issues after the election. Moscow wants Obama to scale back the U.S. missile defense plans in Eastern Europe that Russia has stridently opposed. But any move by the White House to limit those plans would provoke cries of appeasement from Republicans, who will continue to control the House of Representatives.
Obama is pushing to lift Cold-War era trade restrictions that are preventing U.S. companies from enjoying the full benefits of Russia's entry into the WTO. U.S. lawmakers, including many from Obama's party, are tying the removal of restrictions to another bill that would target senior Russian officials implicated in human rights abuses with financial sanctions. The Kremlin has said it would retaliate with economic measures of its own.
There's little appetite in Washington to haggle with North Korea for possible deals to provide aid in return for a rollback in Pyongyang's nuclear program.
Last year, Obama's sole attempt at negotiating a nuclear freeze with North Korea in exchange for food aid ended in failure when Pyongyang launched a long-range rocket in defiance of U.N. ban. Now, North Korea is hinting that it may withdraw from its 2005 commitments on denuclearization as a prelude to declaring itself a nuclear power, which would bring strong U.S. objections.
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