China gives US lecture over crisis

President Barack Obama. Photo / AP

China delivered a stern lecture to the United States to live up to its responsibilities as the cornerstone of the world's economy and keep Washington's political crisis from spilling over into a global financial calamity.

The Chinese Government demanded that President Barack Obama take "concrete measures" to ensure America does not default on its debts.

"Safeguarding the debt is of vital importance to the economy of the US and the world," said Zhu Guangyao, China's vice-finance minister. "This is the United States' responsibility."

The warning comes as America nears the October 17 deadline by which Congress must vote to lift the "debt ceiling", the legal amount of money the US can borrow. If the debt limit is not raised, America could default on its loans for the first time in history, potentially sending shockwaves through the global financial system.

Yet despite dire warnings from economists and the anxious entreaties of foreign governments, Democrats and Republicans remained gridlocked yesterday and the US Government shut down for a seventh consecutive day.

Obama stood firm, ruling out any talks on budget issues, health care or anything else, until House Speaker John Boehner reopens the federal government, now shuttered for a week over a budget impasse, and raises the debt ceiling.

"What we're not willing to do is to create a permanent pattern in which, unless you get your way the government's shut down or America defaults," he said. "That's not how we do business in this country, and we're not going to start now."

Boehner hardened his own line, spinning comments by White House aide Gene Sperling to claim the President preferred default to dialogue. "A senior White House official said that the President would rather default than sit down and negotiate. Really?" Boehner said.

- AFP