U.S. SHUTDOWN FEARS CASTING CLOUD ON APEC SUMMIT / U.S. DEBT CRISIS FEARED
President Benigno Aquino 3rd on Sunday chats with Peru President Ollanta Humala during the APEC CEO Summit in Bali, Indonesia. MALACAÑANG PHOTO
NUSA DUA, INDONESIA, OCTOBER 7, 2013 (MANILA BULLETIN) The United States government warned on Sunday that business in America was suffering from the federal shutdown as concern about Washington’s policy paralysis was voiced at an Asia-Pacific summit where President Barack Obama was a notable absentee.
The first government closure in 17 years has directly affected hundreds of thousands of federal employees, but Commerce Secretary Penny Pritzker said companies were also starting to hurt, not least from her department’s inability to collate vital economic data.
“The shutdown is not good for business. It’s not good for the economy,” Pritzker told reporters at the Asia-Pacific Economic Cooperation (APEC) forum on the Indonesian island of Bali, which Obama has been forced to skip to deal with the political crisis gripping Washington.
“And we need to move on with the business of doing business in the United States. So, I am hopeful this gets resolved soon. It’s obviously having an impact,” Pritzker said.
Her remarks on the economic impact came after Secretary of State John Kerry warned at the APEC meetings on Saturday that the standoff was “reckless”, and would weaken America’s diplomatic standing abroad if it did not end soon.
Apart from APEC, Obama is also missing a separate East Asian summit this week and scheduled trips to Malaysia and the Philippines. His failure to come coincides with a diplomatic push by China in Southeast Asia featuring high-profile visits by President Xi Jinping, who is at APEC.
Speaking at a Bali meeting of APEC business leaders which Obama had also been scheduled to address, Singapore Prime Minister Lee Hsien Loong said the president’s no-show was “a very big disappointment to us”.
“Obviously we prefer a US government that is working to one that is not. And we prefer a US president who is able to travel and fulfill his international duties to one who is preoccupied with national domestic preoccupations,” he said.
Chilean President Sebastian Pinera said the United States had to confront its fiscal problems “in a better way than they are doing it now with shutting down the government”.
Philippine President Benigno Aquino 3rd, who will now play host in Manila to Kerry instead of Obama, proffered understanding for the president’s decision to stay home by underscoring the gravity of the situation.
“The US economy is the number one economy in the world, what happens there affects all of us,” he said in Bali. “The world economy obviously is not in a position to withstand too much shock at this time when we are just recovering as a global economy. We perfectly sympathize.”
The US government closed all but its essential operations on Tuesday when Republican lawmakers refused to approve money for government operations without first delaying or defunding a new health care law commonly known as Obamacare.
Obama is refusing to negotiate with the Republicans over the budget issues until they pass a temporary bill to reopen the government.
Aquino will stay in Bali until October 8. On October 9 and 10, he will proceed to Brunei for the 23rd Association of Southeast Asian Nations (Asean) summit.
At the APEC summit, Aquino will attend the APEC CEO Summit as a panelist on the session on inclusive growth together with Prime Minister Yingluck Shinawatra of Thailand and President Ollanta Humala of Peru.
FROM THE MANILA STANDARD
US debt crisis feared; all eyes on Congress
By Joyce Pangco Panares | Posted 21 hours ago | 298 views
Bali—The Aquino administration is concerned that the possible failure of the United States to raise its debt ceiling would result in negative repercussions to global financial markets, including the Philippines.
Presidential Communications Development Secretary Ramon Carandang said more than the shutdown of the federal government, all eyes are on the US Congress if it would be able to raise a $16.7 trillion debt ceiling by October 17 to avoid a government debt default.
“I am not as concerned about the government shutdown in the United States as I am about the prospects of the failure to raise the debt ceiling. If you’re talking about the potential negative economic impact of what’s happening, we would look beyond the government shutdown and to the prospects of raising the US debt ceiling,” Carandang said.
“The failure of the United States government to resolve that issue would have repercussions on international financial markets and we would be concerned about that as well,” he said.
Carandang acknowledged that the Philippines has some external debt securities, thus causing concern for a prolonged deadlock in the US Congress.
“We are assuming the shutdown will be resolved as soon as possible and it won’t drag on,” he said.
International Monetary Fund managing director Christine Lagarde has already warned that a US debt ceiling crisis would be a far worse threat to the global economy than the current shutdown.
“We have to do a little hand-holding of the international community. This is going to have ripples throughout the world and we’re just a small part of that, but still we need to prepare,” Carandang said.
“We need to do a little hand-holding with the investors. I think the fact that Moody’s finally made us investment grade is going to provide a lot of comfort to international investors. Regardless of what happens overseas, you can see that at least in the Philippines, we have gotten our act together economically. Our fiscal policies are sound, our economic growth remains solid, the fundamentals are in place,” he added.
Carandang said aside from attending the Asia Pacific Economic Cooperation CEO Summit here in Indonesia, President Benigno Aquino III will also make an active pitch for fresh investments into the country.
“The markets will be able to distinguish about between what’s going on in other parts of the world and the fundamentals in the Philippines…There are always good prospects,” he said.
According to a survey conducted by the Pacific Economic Cooperation Council, a regional advisory board that sought more than 500 opinion leaders in the region, uncertainty over economic and budget measures in the US ranked as the fifth biggest risk to the growth of APEC economies.
Carandang said Aquino will also speak on inclusive growth before the leaders of the 21 member-economies of APEC.
“We are going to be talking about inclusive growth. We are going to be showing the reforms we have undertaken over the last three years have borne a lot of fruit in terms of increased confidence in the Philippine economy and in the management of the economy; and as usual, we will be asking people to come take a look and further invest in the Philippines,” he said.
Chief News Editor: Sol Jose Vanzi
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