Obama cancels visits to Malaysia and Philippines as US government shutdown continues; South Korea and US sign new security pact; Asian Development Bank cuts growth forecast for Asia; Afghan election kicks off; Greenpeace activists charge with piracy, could face 15 years in Russian prison; and more
Top of the Agenda: Obama Cancels Two Asia Stops as Shutdown Continues
President Obama cancelled an upcoming trip to Malaysia and the Philippines this weekend due to the partial shutdown of the federal government, but it isn't clear if he will still visit Indonesia and Brunei, which were also on the schedule (WaPo). Deadlock on Capitol Hill continues, leaving government services in limbo as lawmakers refuse to reach an agreement on a funding bill (AP). One outcome of a prolonged government shutdown is that the U.S. Federal Reserve will delay reducing its bond-buying program, boosting emerging market currencies at the expense of the dollar as investors shift away from Treasuries (Bloomberg).
"It's day one, and there is agreement that we don't know where we are headed or how we get there. Both sides are playing a long game and seem unified in their brinkmanship. If current market and political realities are any indicator, we're a long way off from there being enough pressure on either side to deal," writes CFR Senior Fellow Robert Kahn.
"Perhaps the looming mid-October debt ceiling, the breaching of which could have catastrophic financial consequences, will force the Republicans' hand. But it's equally plausible that, having precipitated a government shutdown over the health care law, the House Republicans could simply pass a short-term debt ceiling hike and leave the government closed," writes CFR Senior Fellow Edward Alden.
"Why does Washington claim that demonstrating resolve in the world requires intermittently using military force, but not funding the federal government on time? For those who claimed that attacking Syria with cruise missiles was required to maintain U.S. credibility in the eyes of Iran's Supreme Leader, doesn't Capitol Hill's behavior over the past week do more to demonstrate America's incompetence?" writes CFR Douglas Dillon Fellow Micah Zenko.
South Korea., U.S. Sign New Security Pact
The United States and South Korea signed a new pact to deal with North Korea's potential use of nuclear arms and other weapons of mass destruction, and agreed to review the timing of a scheduled 2015 transfer of command control of their combined forces in the peninsula (Yonhap).
This Backgrounder explains the Six Party Talks on North Korea's nuclear program.
HONG KONG: The Asian Development Bank cut its growth forecast for Asia due to economic slowdown in China and India and skittish regional financial markets as the U.S. Federal Reserve's taper looms (Hindu).
Afghan election kicks off
Greenpeace activists charged with piracy