News / Asia

    Asia Reacts With Caution, Surprise to US Government Shutdown

    Capitol building in Washington D.C., Sept. 19, 2013.
    Capitol building in Washington D.C., Sept. 19, 2013.
    Asian markets saw a modest selloff of stocks and dollars in Tuesday trading upon the partial shutdown of the United States government. 
     
    Market players say news of the first U.S. government shutdown in 17 years did trim early gains on the Tokyo stock exchange, but the benchmark Nikkei managed to close 29 points higher, a gain of a fifth of a percent. Markets in Hong Kong and on the Chinese mainland were closed for a holiday, and South Korea's KOSPI rose one tenth of a percent.
     
    Masamichi Adachi, an economist at JP Morgan in Tokyo, said investors had already anticipated the U.S. government shutdown, and were more worried about a possible impending showdown over the raising of the debt ceiling.
     
    “If it takes longer than say a couple weeks or something, that's definitely negative. And we are more concerned on the debt ceiling issue because that's potentially accompanied by the technical default of the U.S. treasuries. And that's a significant negative impact for the financial markets,” explained Adachi.
     
    The U.S. Treasury Department has warned that the government will exhaust its authority to borrow money in October. Congress must pass measures to raise the debt ceiling before then.
     
    The vice president of Trinity Securities in Bangkok, Nuttachart Mekmasin, expects limited ramifications in Asia, for now. 
     
    “In the short term, there might be some outflow… In the past week foreigners net sold our stocks and also the other Asian countries stocks, but the market has withstood the pressure very well.”
     
    Currency traders sent the U.S. dollar to a nine-month low in Asia as the yen benefitted from the uncertainty in Washington.
     
    The news of the shutdown was covered extensively by domestic media throughout Asia on Tuesday.  
     
    China's state-run Xinhua news agency, in explaining the ramifications of the shutdown to readers, cautioned tourists heading to America that popular destinations, such as national parks and monuments in Washington, D.C., might be closed.
     
    There is also concern about the impact the shutdown could have on trade with the United States.
     
    Professor Chen Qi, at the Carnegie-Tsinghua Center for Global Policy in Beijing, thinks China is unlikely to make this a political issue.
     
    Chen opined that if this had happened in another country, it might be more problematic, but he trusts that the maturity of the U.S. government and American politicians will “have the wisdom to come to a consensus and solve this issue smoothly,” especially since they have been down this road numerous times previously.
     
    In India, some business executives told VOA they could not understand how a country as developed country as the United States could see its government shutdown because of a legislative impasse.
     
    Meher Rana, a first year student at Jesus and Mary College in New Delhi, called it “pretty sad and shocking” and fears a direct impact on her family.
     
    “My father, he is an exporter and he has been working with North American and parts of South American [markets] for a really long time. And the economy is really going down, the government is shut, so it's going to affect him and we are all really shocked,” said Rana.
     
    The partial shutdown of the U.S. government occurred after lawmakers failed to reach agreement by midnight on Monday regarding funding for the new fiscal year, which started October 1st.

    William Gallo in Washington, Aru Pande in New Delhi and VOA Beijing also contributed to this report.

    Steve Herman

    A veteran journalist, Steve Herman is VOA's Southeast Asia Bureau Chief and Correspondent, based in Bangkok.

    You May Like

    US, Somalia Launch New Chapter in Relations

    US sends first ambassador to Somalia in 25 years; diplomatic presence and forces pulled out in 1993, after 18 US soldiers were killed when militiamen shot down military helicopter

    Brexit Vote Ripples Across South Asia

    Experts say exit is likely to have far-reaching economic, political and social implications for a region with deep historic ties to Britain

    Russian Military Tests Readiness With Snap Inspections

    Some observers see surprise drill as tit-for-tat response to NATO’s recent multinational military exercises in Baltic region

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Testing Bamboo as Building Materiali
    X
    June 27, 2016 9:06 PM
    For thousands of years various species of bamboo - one of the world's most versatile plants - have been used for diverse purposes ranging from food and medicine to textiles and construction. But its use on a large scale is hampered because it's not manufactured to specific standards but grown in the ground. A University of Pittsburgh professor is on track to changing that. VOA’s George Putic reports.
    Video

    Video Testing Bamboo as Building Material

    For thousands of years various species of bamboo - one of the world's most versatile plants - have been used for diverse purposes ranging from food and medicine to textiles and construction. But its use on a large scale is hampered because it's not manufactured to specific standards but grown in the ground. A University of Pittsburgh professor is on track to changing that. VOA’s George Putic reports.
    Video

    Video Orphanage in Iraqi City Houses Kids Who Lost their Parents to Attacks by IS

    An orphanage in Iraqi Kurdistan has become home to scores of Yazidi children who lost their parents after Islamic State militants took over Sinjar in Iraq’s Nineveh Province in 2014. Iraqi Kurdish forces backed by the U.S. airstrikes have since recaptured Sinjar but the need for the care provided by the orphanage continues. VOA’s Kawa Omar filed this report narrated by Rob Raffaele.
    Video

    Video Re-Opening Old Wounds in a Bullet-Riddled Cultural Landmark

    A cultural landmark before Lebanon’s civil war transformed it into a nest of snipers, Beirut’s ‘Yellow House’ is once again set to play a crucial role in the city.  Built in a neo-Ottoman style in the 1920s, in September it is set to be re-opened as a ‘memory museum’ - its bullet-riddled walls and bunkered positions overlooking the city’s notorious ‘Green Line’ maintained for posterity. John Owens reports from Beirut.
    Video

    Video Brexit Resounds in US Presidential Contest

    Britain’s decision to leave the European Union is resounding in America’s presidential race. As VOA’s Michael Bowman reports, Republican presumptive nominee Donald Trump sees Britain’s move as an affirmation of his campaign’s core messages, while Democrat Hillary Clinton sees the episode as further evidence that Trump is unfit to be president.
    Video

    Video New York Pride March A Celebration of Life, Mourning of Loss

    At this year’s march in New York marking the end of pride week, a record-breaking crowd of LGBT activists and allies marched down Manhattan's Fifth Avenue, in what will be long remembered as a powerful display of solidarity and remembrance for the 49 victims killed two weeks ago in an Orlando gay nightclub.
    Video

    Video NASA Juno Spacecraft, Nearing Jupiter, to Shed Light on Gas Giant

    After a five-year journey, the spacecraft Juno is nearing its destination, the giant planet Jupiter, where it will enter orbit and start sending data back July 4th. As Mike O'Sullivan reports from Pasadena, California, the craft will pierce the veil of Jupiter's dense cloud cover to reveal its mysteries.
    Video

    Video Orlando Shooting Changes Debate on Gun Control

    It’s been nearly two weeks since the largest mass shooting ever in the United States. Despite public calls for tighter gun control laws, Congress is at an impasse. Democratic lawmakers resorted to a 1960s civil rights tactic to portray their frustration. VOA’s Carolyn Presutti explains how the Orlando, Florida shooting is changing the debate.
    Video

    Video Tunisian Fishing Town Searches for Jobs, Local Development Solutions

    As the European Union tries to come to grips with its migrant crisis, some newcomers are leaving voluntarily. But those returning to their home countries face an uncertain future.  Five years after Tunisia's revolution, the tiny North African country is struggling with unrest, soaring unemployment and plummeting growth. From the southern Tunisian fishing town of Zarzis, Lisa Bryant takes a look for VOA at a search for local solutions.
    Video

    Video 'American Troops' in Russia Despite Tensions

    Historic battle re-enactment is a niche hobby with a fair number of adherents in Russia where past military victories are played-up by the Kremlin as a show of national strength. But, one group of World War II re-enactors in Moscow has the rare distinction of choosing to play western ally troops. VOA's Daniel Schearf explains.
    Video

    Video Muslim American Mayor Calls for Tolerance

    Syrian-born Mohamed Khairullah describes himself as "an American mayor who happens to be Muslim." As the three-term mayor of Prospect Park, New Jersey, he believes his town of 6,000 is an example of how ethnicity and religious beliefs should not determine a community's leadership. Ramon Taylor has this report from Prospect Park.
    Video

    Video Internal Rifts Over Syria Policy Could Be Headache for Next US President

    With the Obama administration showing little outward enthusiasm for adopting a more robust Syria policy, there is a strong likelihood that the internal discontent expressed by State Department employees will roll over to the next administration. VOA State Department correspondent Pam Dockins reports.
    Video

    Video Senegal to Park Colorful ‘Cars Rapides’ Permanently

    Brightly painted cars rapide are a hallmark of Dakar, offering residents a cheap way to get around the capital city since 1976. But the privately owned minibuses are scheduled to be parked for good in late 2018, as Ricci Shryock reports for VOA.

    Special Report

    Adrift The Invisible African Diaspora