Biden Cuts Asia Tour Short With Debt Ceiling Deadline Ahead

President Joe Biden is cutting the Asia trip short and returning to the U.S. Sunday after the G7 meeting for debt ceiling negotiations.

Biden will return to the U.S. Sunday after the G7 meeting in Japan for debt ceiling negotiations, according to Kelly O’Donnell of NBC News.

Biden had been set to leave the Oval Office for more than a week in order to seek stronger ties with possible allies in Asia, even as a debt ceiling crisis threatens to leave the U.S. cashless. The trip is Biden’s first abroad since the launch of his 2024 reelection campaign.

Biden's tour will begin Thursday with a G7 meeting in Hiroshima, Japan. While China is not a member of the Group of Seven nations and will not be at the gathering, it is likely to be a hot topic of discussion.

What’s At Stake: Rising tensions between the U.S. and China over the dominance of key global economic resources, including a recent race to control the supply of high-end semiconductor chips, has sparked concern among analysts of the rise of a new Cold War.

Read also: Chinese Tech Companies Forced To Think Outside The Box To Overcome US Chip Ban In The Race For AI Supremacy

China's active sovereignty claim over U.S.-backed Taiwan is helping to build up tension. China's military said on Tuesday that it will "resolutely smash any form of Taiwan independence.” 

Sino-American relations have deteriorated in recent months after the appearance of a Chinese surveillance balloon above U.S. airspace caused the cancellation of a visit from U.S. secretary of state Antony Blinken to Beijing.

The meeting in Japan will include Canada, France, Germany, Italy and the U.K. as well as other non-G7 nations invited by Japan that include Brazil, Vietnam, Indonesia, India, South Korea and Australia, according to The Washington Post.

National Security Council spokesman John Kirby said the topic of China will be discussed by Biden and his counterparts. Increasing support for Ukraine, fighting climate change and dealing with global inflation are other key topics in Biden's agenda for the trip.

"We are not going to the Indo-Pacific this week to arm-twist," said Kirby. "We're going to talk to allies, partners, friends and neighbors about mutual challenges and opportunities in the region, and how we can capitalize on each other's capabilities."

Some of the stops in Biden's planned mission were directly related to securing strategic military alliances across the area. The president's now-canceled second stop was Papua New Guinea, a country in Oceania where a session of the Pacific Islands Forum will take place.

Biden had been expected to sign a pact that would boost Papua New Guinea's defenses and allow for more training exercises with the U.S. military. 

The next planned stop in his journey was Australia. In March, the U.S., the U.K. and Australia unveiled details of a three-way military alliance that includes a planned $100-billion investment from Australia to buy U.S.- and U.K.-made submarines that are expected to secure the South Pacific Ocean from Chinese influence.

The first nuclear-powered submarine is not expected to arrive until 2032. The move was strongly opposed by China's foreign ministry, which called it "Cold War mentality."

Australia will also host a meeting of the Quad group, a strategic security dialogue between Australia, India, Japan and the U.S.

Stocks To Watch: U.S.-listed ETFs following the Chinese economy were down on Tuesday.

• iShares MSCI China ETF MCHI was down 1.21% on Tuesday at the time of this writing.
• KraneShares CSI China Internet ETF KWEB was down 1.13%.
• SPDR S&P China ETF GXC was down 1.22%