"What a terrible way to begin a new administration, with an abortion business bailout that will exploit women in developing countries for political ends," said Charmaine Yoest, president of Americans United for Life Action , a Washington-based pro-life activist organization. "We should not export the tragedy of abortion to other nations, and we certainly shouldn't do so via the hard-earned dollars of American taxpayers."

The policy banned U.S. taxpayer money, usually in the form of funds from the U.S. Agency for International Development, from going to international family planning groups that either offer abortions or provide information, counselling or referrals about abortion. A federal law known as the Hyde amendment prohibits U.S. funding from being used directly to provide abortions.

The Mexico City policy was established in 1984, reversed by President Bill Clinton in 1993 and re-established under President George W. Bush in 2001. Clinton and Bush each took their actions on Jan. 22, the anniversary of the U.S. Supreme Court's landmark 1973 decisions of Roe v. Wade and Doe v. Bolton that recognized abortion as a constitutional right and overturned state laws against abortion.

The policy has been called the "global gag rule" by its opponents, because it prohibits taxpayer funding for groups that even talk about abortion if there is an unplanned pregnancy, and is known as the Mexico City policy because it was unveiled at a UN conference there in 1984.

Many people expected Obama, like Clinton and Bush, to sign the executive order Jan. 22, when thousands of pro-life marchers were protesting U.S. abortion policy, but he decided to wait a day.

"I see that as a sign of respect to the Catholics and other pro-life activists," said Thomas P. Melady, a former U.S. ambassador to the Vatican, who wanted to see the Mexico City policy remain intact.

"It says something about his style and the courtesy he extended to those of us participating in the March for Life," Melady told Catholic News Service Jan. 23. "It says he is concerned about the other point of view, which is a good foundation for finding common ground."

Not everyone saw Obama's waiting a day after the pro-life observance as a sign of respect.

"If he respected the pro-life cause, he wouldn't have signed this order at all," said Deirdre A. McQuade, assistant director for policy and communications for the U.S. Conference of Catholic Bishops' Office of Pro-Life Activities .

"We're concerned this can only be the tip of the iceberg for President Obama's abortion policy. This should strengthen our resolve" for the pro-life cause.

The executive order will not fund abortions directly, McQuade said, but it will indirectly provide financial resources to perform the procedures.

"Since these organizations will be getting U.S. funding, it will free them up to use money they would have had to spend elsewhere on abortions," she said.

According to a fact sheet provided by Third Way, a Washington-based non-profit, non-partisan think tank, more than 99 per cent of the estimated 536,000 women who die each year from pregnancy-related causes live in developing countries. Third Way argues that, if family planning needs were met for all women in the developing world who do not have access to contraception, pregnancy-related deaths would drop by 25 per cent to 35 per cent.

Pro-life activists call those statistics a smoke screen to promote an abortion agenda.

"Here we have a black president taking money from the taxpayers in a time of economic crisis and giving it to organizations — many of which are anti-Catholic — so they can spend it on killing non-white babies in Third World nations," said Bill Donohue, president of the New York-based Catholic League for Religious and Civil Rights .

"This move is a significant step backward in respecting the sovereignty of nations, in empowering women and in protecting the unborn," said Denise Burke, vice president of legal affairs for Americans United for Life Action.

"Pro-abortion organizations like the International Planned Parenthood Federation are actively working to impose radically pro-abortion laws on developing nations, showing no regard for the will of the people in these countries," she said.