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US president tells parliament that Europe and the US will not be eclipsed by booming eastern economies Barack Obama declared on Wednesday that the Anglo-American special relationship would provide “indispensable” leadership to the world and said it was wrong to think that the rise of China and India had undermined the transatlantic alliance. In a speech designed to reassure Britain and other European countries, which fear that Obama’s Hawaiian upbringing means he instinctively looks to the Pacific, the president rejected as “false” the idea that Europe and the US were in terminal decline. Obama opened his speech with a joke after the House of Commons Speaker, John Bercow, said he was the first US president to address both houses of parliament in Westminster Hall. “I have known few greater honours than the opportunity to address the mother of parliaments at Westminster Hall,” the president said. “I am told that the last three speakers here have been the pope, Her Majesty the Queen and Nelson Mandela, which is either a very high bar or the beginning of a very funny joke.” Parliamentarians, who laughed at the joke, then listened to the president largely in silence until he spoke of the honour of how the grandson of a Kenyan cook could address parliament as US president. “It is possible for the sons and daughters of former colonies to sit here as members of this great parliament and for the grandson of a Kenyan who served as a cook in the British army to stand before you as president of the United States,” he said. His speech followed a joint press conference with David Cameron in the garden of Lancaster House . The prime minister said he had agreed with the US president that Nato would turn “up the heat” on Libya. Obama said the departure of Libyan leader Muammar Gaddafi was essential: “We will continue those operations until Gaddafi’s attacks on civilians cease. Time is working against Gaddafi and he must step down from power and leave Libya to the Libyan people.” The main thrust of the speech to MPs and peers was designed to show that the US still remained committed to the transatlantic relationship. Obama insisted that Europe and the US would not be eclipsed by booming economies in the east. Warning of profound challenges ahead, he said: “The international order has already been reshaped for a new century. Countries like China, India and Brazil are growing by leaps and bounds. We should welcome this development for it has lifted hundreds of millions from poverty around the globe and created new markets and opportunities for our own nations. “And yet, as this rapid change has taken place, it has become fashionable in some quarters to question whether the rise of these nations will accompany the decline of American and European influence around the world. Perhaps, the argument goes, these nations represent the future and the time for our leadership has passed. That argument is wrong. The time for our leadership is now. “It was the US and the UK and our democratic allies that shaped a world in which new nations could emerge and individuals could thrive. Even as more nations take on the responsibilities of global leadership, our alliance will remain indispensable to the goal of a century that is more peaceful more prosperous and more just. At a time when threats and challenges require nations to work in concert with one another, we remain the greatest catalysts for global action.” Obama said Europe and the US enjoyed an “inherent advantage” in the global economy they shaped. He said: “In other words, we live in a global economy that is largely of our own making. The competition for the best jobs and industries favours countries that are free-thinking and forward-looking; countries with the most creative, innovative, entrepreneurial citizens. “That gives nations like the United States and the United Kingdom an inherent advantage. From Newton and Darwin to Edison and Einstein; from Alan Turing to Steve Jobs, we have led the world in our commitment to science and cutting-edge research; the discovery of new medicines and technologies. We educate our citizens and train our workers in the best colleges and universities on Earth. “But to maintain this advantage in a world that’s more competitive than ever, we will have to redouble our investments in science and engineering and renew our national commitments to educating our workforces.” Obama identified the challenges as: • Economic. “In an era defined by the rapid flow of commerce and information, it is our free market tradition, our openness fortified by our commitment to basic security for our citizens that offers the best chance for prosperity that is both shared and fair.” But he warned that markets fail: “We have also been reminded in the last few years that markets can sometimes fail. In the last century, both our nations put in place regulatory frameworks to deal with such market failures – to protect the banking system after the great depression, for example. But in today’s economy, such threats of market failure can no longer be contained within the borders of any one country. Market failures can go global, can go viral and demand international responses.” • Security. “Our nations are not, and will never be, at war with Islam. Our fight is focused on defeating al-Qaida and its extremist allies. In that effort, we will not relent as Osama bin Laden and his followers have learnt.” Obama said Nato was achieving a breakthrough against the Taliban in Afghanistan. Paying tribute to an “unbroken line of heroes” in the military, he said: “Because of them we have broken the Taliban momentum; because of them we have built the capacity of Afghan security forces; and because of them we are now preparing to turn the corner in Afghanistan by transitioning to Afghan lead.” • The future of the Arab spring. Obama said: “In country after country, people are mobilising to free themselves from the grip of an iron fist. While these movements for change are just six months old, we have seen them play out before – from eastern Europe to the Americas; from South Africa to south-east Asia.” Obama hailed the Arab spring as a “rebuke to al-Qaida”, adding: “What we saw in Tehran, Tunis and Tahrir Square is a longing for the same freedoms that we take for granted at home. It was a rejection of the notion that people in certain parts of the world don’t want to be free or need to have democracy imposed upon them. It was a rebuke to the worldview of al-Qaida, which smothers the rights of individuals and would thereby subject them to perpetual poverty and violence.” Barack Obama David Cameron House of Commons House of Lords Foreign policy al-Qaida Global terrorism Libya Middle East Africa Global economy Economics Nicholas Watt guardian.co.uk