4 Oct 2013

Obama cancels trip to Asia amid partial US govt shutdown

10:16 pm on 4 October 2013

US President Barack Obama has cancelled his trip to Asia because of the US government shutdown.

Mr Obama will miss two summits, the Asia-Pacific Economic Co-operation (APEC) meeting in Indonesia and the Association of Southeast Asian Nations meeting in Brunei.

Secretary of State John Kerry will attend the APEC gathering and the East Asia summit in Brunei in Mr Obama's place, the White House said.

The decision was made due to the "difficulty in moving forward with foreign travel in the face of a shutdown", the White House said.

Mr Obama had been due to begin a four-nation Asian trip which included Indonesia, Brunei, Malaysia and the Philippines.

President's absence won't hold up APEC, says Bollard

Executive director of the APEC Secretariat, Alan Bollard, says the Bali summit will go ahead as normal, despite Mr Obama's decision not to attend.

Dr Bollard says it is disappointing, but other leaders will understand the reasons he is not there.

He says Mr Obama's absence will not hold up APEC's work to free up trade in the region, and make it more resilient to cope with economic shocks.

Dr Bollard says he's sure the US president will be involved if any important decisions need to be made.

US could go into severe recession if deadlock continues, says Treasury

The US government has partially shut down after the two houses of Congress failed to agree a new budget.

President Obama has warned that Wall Street should be concerned that a conservative faction of Republicans is willing to allow the country to default on its debt.

The US government has partially closed after Congress failed to agree a budget and will run out of cash on 17 October unless its debt ceiling is raised, the BBC reports.

The ABC reports that the US Treasury Department is warning failure to do so could trigger a freeze in credit markets, a collapse in the value of the US dollar and US interest rates to skyrocket.

US Treasury fears such a crisis could be worse than that in 2008.

In a TV interview Mr Obama said he was "exasperated".

The US government closed non-essential operations on Tuesday after Congress failed to strike a deal on a new budget.

Republicans and Democrats are blaming each other for the impasse.

US shutdown prompts spy worries

One of America's most senior intelligence officials meanwhile has warned the partial government shutdown seriously damages the ability of spy agencies to protect the United States.

National intelligence director James Clapper told the senate judiciary committee the furloughs of civilian staff come on top of budget constraints.

"This affects our global capability to support the military, to support diplomacy and to support our policy-makers," he said.

Mr Clapper said if the disruption continues, the US will face greater jeopardy with each passing day.

Mr Obama is due to meet the leaders of the biggest financial service institutions to try to focus the nation's attention on an even more perilous vote, that on raising America's debt ceiling.

The White House is warning Republicans not to attach any demands to that, saying it would be irresponsible for the president to negotiate the full faith in credit of the United States under partisan threat.