Monday 7 October 2013

US government shutdown is beginning to take its toll on business, warns Commerce Secretary… and not just in America

Mr Obama is refusing to negotiate with the Republicans over the budget issues until they pass a temporary bill to reopen the government. He also wants agreement to raise the $16.7 trillion US borrowing limit, to avoid the country defaulting on its debts.
US defence contractor Lockheed Martin will today put 3,000 of its workers on unpaid leave - a move it announced on Friday - but has not ruled out further lay-offs if the shutdown continued.
National Guard aircraft maintenance facility that is closed due to the federal government shutdown, Thursday, Oct. 3, 2013, at Joint Base Lewis-McChord, Wash
National Guard aircraft maintenance facility that is closed due to the federal government shutdown, Thursday, Oct. 3, 2013, at Joint Base Lewis-McChord, Wash
United Technologies, which produces Blackhawk helicopters and has the US government as a major client, has also temporarily placed 2,000 employees on leave without pay.
It said that certain sections of its manufacturing business had been halted because there were no government inspectors working to sign off products.
The widening impact of the shutdown sparked concern at Apec meeting in Bali on Sunday.
Meanwhile, Chilean President Sebastian Pinera said the US had to confront its fiscal problems "in a better way than they are doing it now with shutting down the government".
Sign of the times: A message near the Capitol Building in Washington as the shutdown comes to the end of its first week
Sign of the times: A message near the Capitol Building in Washington as the shutdown comes to the end of its first week


Economic warning: US Secretary of Commerce Penny Pritzker, at the Asia-Pacific Economic Cooperation in Bali
Economic warning: US Secretary of Commerce Penny Pritzker, at the Asia-Pacific Economic Cooperation in Bali
The US Secretary of Commerce has warned that businesses in America and abroad are beginning to suffer from the effects of the Federal Government shutdown.
Penny Pritzker, who is also a business executive and entrepreneur, spoke out about the US government deadlock during a meeting of the Asia-Pacific Economic Cooperation (APEC) leaders on the Indonesian island of Bali.
And, in statement that showed the shutdown was not just a domestic issue, Philippines President Benigno Aquino said what happened in the US 'affects all of us'.
He said: 'The US economy is the number one economy in the world, what happens there affects all of us.
'The world economy obviously is not in a position to withstand too much shock when we are just recovering as a global economy.'
US President Barack Obama has cancelled a scheduled trip to Asia because of the shutdown, and that too has drawn criticism from APEC leaders.
Mr Obama was supposed to be discussing a free-trade agreement between 12 countries, but his absence has thrown any progress into doubt. It will be a major source of disappointment to the countries that were to be involved in the agreement, called that Trans-Pacific Partnership.
Ms Pritzker said: 'The shutdown is not good for business. It's not good for the economy.'
She explained that her own department was not collecting business data, which was used by international businesses.
Benigno Aquino
Obama
Global concern: Philippines President Benigno Aquino says the US crisis affects the world economy. The decision of Barack Obama to postpone an Asia tour has also thrown international trade agreements into doubt
She added: 'We're a huge source of data for American business and that is a problem... It's affecting businesses and it's affecting their ability to get data.'
The US government closed non-essential operations on Tuesday after Congress failed to agree a new budget.

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