SEOUL, South Korea (AP) — Tensions over currencies and trade gaps are simmering ahead of a summit of global leaders this week as America’s move to flood its sluggish economy with $600 billion of cash triggers alarm in capitals from Berlin to Beijing.

Major exporting countries such as China and Germany are complaining about the Federal Reserve’s decision to buy more Treasury bonds to try to lower interest rates, spur growth and reduce high unemployment in the United States. They say the Fed’s plans are driving down the dollar’s value and giving U.S. goods an unfair competitive edge in world markets.

Other countries such as Thailand, Brazil and Indonesia fear the Fed’s action will send cash into their markets in search of higher returns. That risks raising their currency values, squeezing their exporters and inflating bubbles in stocks or other assets that could destabilize their financial systems.

As the Group of 20 major rich and developing nations prepare to meet in Seoul, President Barack Obama defended the Fed. He said the central bank was following its mandate to “grow our economy.” Obama also took a veiled shot at China for keeping its own currency, the yuan, low to benefit Chinese exporters.

“We can’t continue to sustain a situation in which some countries are maintaining massive surpluses, others massive deficits, and there never is the kind of adjustments with respect to currency that would lead to a more balanced growth pattern,” Obama told reporters in India.

The Group of 20 major rich and developing nations has taken on the role of reforming the world economy in the wake of the 2008 financial crisis. Its leaders first met two years ago and have set out an ambitious agenda to ensure stable economic growth, strengthen financial supervision to prevent another meltdown and give developing countries more of a voice.

But discussions on achieving those goals at the summit Thursday and Friday in Seoul are being complicated by the furor over the Fed’s decision to buy $600 billion in Treasury bonds over the next eight months to try to energize the world’s largest economy.

At the heart of the discussions is the recognition that a decades-long global economic order centered on the U.S. buying exports from the rest of the world and running huge trade deficits while countries such as China, Germany and Japan accumulate vast surpluses is no longer tenable in the aftermath of the crisis.

The fissures in the global economy were underlined Wednesday with the release of China’s trade figures for October which showed its surplus for the month swelling to $27 billion. The surge will add to pressure on Beijing at the G-20 meeting to ease currency controls that Washington and other trading partners say are costing jobs.

“The present world economy is unbalanced,” Paul Volcker, a top economic adviser to President Barack Obama and a former Fed chief, said in Seoul last week. “It’s unbalanced in a way that can’t persist if we are going to have a thriving global economy.”

The attempt to give the world economy an extreme makeover has gotten some of its momentum from the rise of countries such as India, China and Brazil to become economic and political giants in their own right. The G-20 meetings themselves are a sign of how much things have changed since the crisis. They symbolize the end of a system in place since the 1940s in which the world economy was managed largely by a handful of rich nations led by the United States, Europe and later Japan.

The forum, established in 1999, is a disparate combination of rich nations, developing economies, rising powers and consumers and producers of natural resources. The European Union is also a member. It took the financial crisis, however, to thrust the G-20 into a position of global leadership, supplanting the Group of Seven club of advanced nations.

Besides discussing currencies and reducing trade gaps, G-20 leaders are also likely to endorse proposals for beefing up supervision of large banks and other financial institutions. They are also widely expected to express support for a proposal to give developing countries more voting power at the International Monetary Fund and more seats on the board of the key global lender.

There is broad agreement within the G-20 on the need for countries such as China to consume more, save less and let their currencies strengthen to become less reliant on exports for growth. But the questions of how fast, how to go about it and the role of U.S. policies have caused divisions.

Recent debate centered on a U.S. proposal unveiled at a G-20 meeting of finance officials last month to set guidelines for when surpluses and deficits in the current account — a broad measure of trade and investment — become potentially destabilizing.

Those officials agreed that G-20 members will not use their currencies as trade weapons and will also work to come up with guidelines for current account gaps, calming fears of a trade war.

But tensions re-emerged when the Fed announced its bond buying plan last Wednesday. Aside from concerns about exports, the massive increase in the supply of dollars is a potential threat to the wealth of many nations because the bulk of their foreign currency reserves are stored in dollar-denominated assets.

In Beijing, Vice Finance Minister Zhu Guangyao said Monday that China would have a “candid” exchange of views with the U.S. and called the bond-buying plan “a shock to the stability of global financial markets.”

His criticism followed that of other G-20 capitals. German Finance Minister Wolfgang Schaeuble said he didn’t think the plan would work and that the Americans are “creating extra problems for the world.” Guido Mantega, Brazil’s finance minister, said the move would devalue the dollar and hurt Brazil and other exporters.

Despite the heated debate, it is widely agreed the G-20 gatherings are positive and provide, in Volcker’s words, a reminder that the leaders “have a common problem.”

Yet the challenges are also seen as enormous.

“The problem is that we let the imbalances grow so large that there’s no easy fix now,” said Bill Belchere, chief global economist for Mirae Asset Securities in Hong Kong. “The adjustments necessary are politically palatable to no one.”

___

AP Business Writers Erika Kinetz in Mumbai, India, Joe McDonald in Beijing and Paul Wiseman in Washington contributed to this report.