“A few hours ago, we received word that the US Government would enter a partial shutdown due to political disagreements over the passage of the next budget. This is highly unfortunate for the rest of the world, as even countries like the Philippines are taken on a wild economic ride because of the political game of chicken in Washington.

“The US enjoys a level of global political power as the world’s largest economy and the holder of the global reserve currency, but I hope that the political leadership in Washington also recognizes their global responsibility, as their domestic disputes now carry ramifications across the world.

“Fortunately for the Philippines, we enjoy a strong fiscal position, a structural current account surplus economy whose growth is led by consumption, and a young, educated population. This will allow the Philippines to ride out this situation better than other emerging markets – whose economic models are exports and extractives-based.

“What is more worrisome to the Philippines is if the US political stalemate cause America to default on its debt by failing to pass a measure on the debt ceiling. A US default, unimaginable for most of history yet now in the realm of the possible because of current political circumstances, can only lead to unprecedented chaos in the global financial markets.