Debt crisis forces Biden to cancel summit

JOE BIDEN has been forced to abandon a trip to the Indo-pacific aimed at countering China, as he is locked in talks to avert a possible catastrophic US debt default.

Mr Biden, 80, was due to hold a “Quad” summit with Australia, India and Japan and make a first visit by a US president to Papua New Guinea as America seeks to resist China’s growing influence in the region.

However, he cancelled the plans so that he could return early from Asia to attend G7 talks starting today, to try to resolve the debt ceiling crisis in Washington. The last-minute cancellation risks undermining US credibility when it is competing with Beijing for influence, experts warned.

The White House is locked in talks with Republicans about raising the legal limit for how much the government can borrow.

Without a resolution, the US could run out of money as soon as early June and default on its debt repayments.

Janet Yellen, the US treasury secretary, has said a default would trigger a global economic downturn.

“Defaulting on the debt is simply not an option,” Mr Biden said, as he announced that the last leg of his trip would be cancelled. The stops in Sydney and Canberra, where Mr Biden was due to address Australia’s federal parliament, would have marked the first time it has hosted a sitting US president since Barack Obama was in the country for the G20 summit nearly a decade ago.

Anthony Albanese, Australia’s prime minister, yesterday confirmed that the Quad meeting had been cancelled and said that he instead hoped to talk to Mr Biden, Fumio Kishida, the Japanese prime minister, and Narendra Modi, the Indian prime minister, when they meet in Hiroshima.

Ashley Townshend, an Indo-pacific security analyst at the Carnegie Endowment for International Peace, said: “This is an incredible own goal by the US system…. Bad when politics undercuts strategy.”