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"You guys inspire me," US President Barack Obama said after he discussed activism and aspiration on Saturday with young Britons, including one who emotionally "came out" as a non-binary person identifying as neither male nor female.

Obama quoted black civil rights activist Martin Luther King as he encouraged the group to "reject pessimism and cynicism" but accept compromise as they fight for change.

"The arc of the moral universe is long, but it bends toward justice," he quoted from a 1965 speech by King, as he answered one of 10 questions from an invited audience of 550 people under 30 years old, many of them from a US embassy-run Young Leaders UK programme.

One of the invitees, Usaama Kaweesa, 25, told dpa after the "town hall" event that he had joined the Young Leaders group after hearing about it while working for a voluntary organization that focussed on empowering young people.

"I saw it a as great opportunity to strengthen the connections between the UK and the US, especially for young people, and so I just got involved to see what it would be like," said Kaweesa, who now works for Restless Development, a London-based international development charity.

Kaweesa said Saturday was the second time he had seen Obama. "The first time I saw him, it was at his second inauguration in 2013. I was in a bit of a slump and I needed some inspiration, so I decided to spontaneously take my first trip to the States. 

"There's aspects of his life that are really inspiring, and so it was great to meet him," Kaweesa said.

Obama was introduced by Khadija Najefi, 21, a final-year student at King's College London, who said the Young Leaders group was "filled with the next Obamas, the next David Camerons and the next Steve Jobs."

He faced questions on conflict, security, trade, diversity, migrant deaths, his personal legacy, climate change, equality and extremism, leadership and US minorities. The first question he was asked was about the Northern Ireland peace process.

"And what's interesting is the degree to which the example of peacemaking in Northern Ireland is now inspiring others," he said, giving the example of Colombia.

The key to peace between mutually hostile groups was "having empathy and a connection to people who are not like you," Obama said.

Discussing his legacy, he urged patience. "Change takes time," he said, discussing the US civil rights movement and quoting King. 

"There's still discrimination in aspects of American life, even with a black president," Obama said. "And, in fact, one of the dangers is that by electing a black president, people say there must be no discrimination at all."

"I consider myself a [relay] runner," he said.

Obama's biggest surprise came when he took a question from Maria Munir, a 20-year-old politics student. 

"Now, I'm about to do something terrible - terrifying, which is, I'm coming out to you as a non-binary person, which means that I don't fit within - I'm getting emotional, I'm so sorry," Munir said, before they were interrupted by applause and cheers.

"Because I'm from a Pakistani Muslim background, which inevitably has cultural implications," Munir continued.

Munir wished that "yourself and David Cameron would take us seriously as transgender people," challenging Obama to explain "what you can do to go beyond what has been accepted as the LGBTQ (Lesbian, Gay, Bisexual, Transgenger and Queer) rights movement."

Obama told Munir their statement "wasn't that crazy."

"I thought you were gonna ask to come up here and, you know, dance with me or something," he said. "I'm incredibly proud of the steps it sounds like you've already taken to speak out about your own experience and then to try to create a social movement and change laws."

After the event, Munir thanked people for their support and said they would use the media attention as an "opportunity to raise more awareness." "I'm so touched by all your support and the personal messages I've received for standing up on this issue," Munir wrote on Twitter.

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