By Laura MacInnis
WASHINGTON (Reuters) - President Barack Obama, grappling with a poor economy and slumping approval ratings, faces problems on a larger stage this week at the United Nations, with challenges to his leadership in the Middle East and questions about the U.S. role in the world.
Obama will seek to reassert his diplomatic credentials in an address Wednesday in the cavernous U.N. General Assembly hall, where he has been warmly received in past years.
But this year, he faces a possible rebuff to U.S. leadership in the Palestinians' quest for statehood via a U.N. resolution, and questions about whether global economic worries have overshadowed "soft power" issues he previously espoused.
Those issues include food security, human rights and treating HIV/AIDS, raising concern among activists about Washington's commitment to international development aid.
Obama's vision of multilateral diplomacy helped win him a Nobel Peace Prize after only 11 months in office and made him popular in many European countries and elsewhere.
"The mood music that came with Obama's office dramatically changed the relationship back to one of partnership," said Nancy Soderberg, a former U.S. national security official and diplomat.
But the sense of optimism about his leadership has given way to doubts.
Obama's style of "trying to lead but not dominate" on the world stage had been a let-down for some after euphoria over his collaborative style wore off, said Jon Alterman of the Center for Strategic and International Studies in Washington.
"This was initially welcomed with rapture, and has been dismissed, and I think he needs to rearticulate it in a way that's persuasive to an international audience," he said.
Addressing the United Nations' full membership -- which hit 193 with the July entry of South Sudan -- is a staple September activity for U.S. presidents, along the lines of a State of the Union speech but directed mainly at an international audience.
This year, with the 2012 presidential election looming large over the White House and jobs dominating most Americans' priorities, Obama's appearance in New York is expected to be something of a flash in the pan.
"The president is clearly focused on jobs and the economy. The politics of the budget are huge. We have an extraordinarily active Republican primary. I don't see the American public hanging on the words of the president at the General Assembly," Alterman said. "My guess is that the message of the month has to do with the economy, not international affairs."
Obama is expected to use his U.N. address to reiterate his support for a two-state Middle East solution based on negotiations between Israel and the Palestinians.
Palestinian President Mahmoud Abbas, defying the United States and Israel, vowed to seek statehood via a U.N. Security Council resolution, which the White House has pledged to veto.
U.S., European, Russian and U.N. diplomats have opened discussions on relaunching Israeli-Palestinian peace talks to try to avert a showdown, but no immediate progress was cited.
Obama is also expected to touch on what should follow the "Arab Spring" uprisings that ousted dictators across North Africa, including in Libya, where the U.S. supported NATO's air strikes to stop leader Muammar Gaddafi from killing civilians.
Ben Rhodes, White House deputy national security adviser, also said economic issues were likely to be paramount in talks between world leaders in New York. Obama's speech is set to stress U.S. and other efforts "to get the global economy moving as we approach a G20 meeting in France," Rhodes said.
Worries about the euro zone are expected to dominate the "hallway chatter" at the United Nations because of rising fears that Europe's economic troubles could hurt global growth.
Obama isn't expected to announce any new international development projects with U.S. aid budgets under strain and debt-focused Republicans controlling the House of Representatives.
But aid activists hope the Democratic president expresses a commitment to keep funding life-saving and economic development projects -- which could help encourage European and other donors facing similar budget pressures.
"We know that resources are going to be tight," said Sam Worthington, head of InterAction, the largest alliance of U.S.-based international NGOs. "Given the tight resources, we need the president to step up and make clear his administration will see global food security and other priorities through."
Another CSIS expert, Mark Quarterman, said Obama's speech would likely seek to highlight potential for improved human rights in a post-Gaddafi Libya and push Syrian leader Bashar al-Assad to end his bloody repression of protesters.
"I think the stakes are extremely low," Quarterman said.
(Editing by Warren Strobel and Christopher Wilson)