BEIJING (Reuters) - China said it hoped the United States will take effective steps to improve its fiscal position, in Beijing’s latest expression of concern about the possibility that Washington could briefly default on debt.
Republican lawmakers have raised the prospect of a brief debt default as a means to force deeper government spending cuts they are demanding from the Obama administration, and a Chinese central bank adviser already said on Wednesday that a default would be “playing with fire.”
“This is not a foreign policy question, but I want to point out that we hope that the United States will be able to adopt effective measures so that the U.S. fiscal and financial situation improves and turns around,” the Foreign Ministry spokesman Hong Lei said at a regular press briefing.
Hong said such steps would help to “protect the stability of international financial markets and encourage steady and healthy development of the world economy.”
China, the United States’ biggest creditor with more than $1 trillion in Treasury debt as of March, fears even a small default could destabilize the global economy and sour political relations.
Reporting by Michael Martina; Editing by Ken Wills