China welcomes end to US fiscal gridlock

US President Barack Obama on early Thursday signed the short-term bill that averted the possibility of a historic default on US debt and reopened the federal government after the spending measure passed the US Senate and House of Representatives.

But analysts warned of the possibility of another crisis next year as the bill only funds the government until January 15 and raises the debt ceiling until February 7. Also, it does not include any provision about the Obamacare policy that has been at the core of the dispute between the White House and the GOP.

In a televised speech to the nation, Obama said on Thursday "there are no winners here. These last few weeks have inflicted completely unnecessary damage upon our economy."

He said it slowed the economy's growth and set back employers' plans to hire. "Just the threat of default ... increased our borrowing costs, which adds to our deficit," he said.

The president noted that "Americans are completely fed up with Washington."

Obama earlier also said US leaders needed to "earn back" the trust of the American people after the crisis.

China on Thursday welcomed the US passing of the legislation.

"We welcome the US progress in dealing with these issues," Chinese foreign ministry spokeswoman Hua Chunying said at a daily press briefing in Beijing.

"As the world's largest economy, the proper settlement of the issues works for US interests and benefits world economic stability and development," Hua said.

The bipartisan bill to end the financial deadlock is a relief for both the US and the international community, but it still came as a temporary deal and is not a long-term solution to the crisis, Shi Yinhong, a professor with the School of International Studies at the Renmin University of China, told the Global Times.

The core part of the dispute, Obamacare, was not included in the agreement between the Democrats and the Republicans and this means it is possible that the act would still pose a major hurdle when Washington seeks a solution to its debt and financial issues in the future, Shi said.

Shen Jiru, a research fellow with the Institute of World Economics and Politics of the Chinese Academy of Social Sciences, told the Global Times that neither side is likely to make any concession on the issue.

Obama has been treating Obamacare as one of the most important achievements during his administration and the Republicans have been rather united and strong in their fight against it, Shen said.

Minutes after Obama signed the bill, White House budget director Sylvia Mathews Burwell issued a directive to employees, saying the government would try and make the transition back to becoming fully operational as smooth as possible.

The October 1 government shutdown forced the closure of the US national parks, monuments and many government services and the temporary lay-off of hundreds of thousands of federal workers, although critical functions of government went on as usual.

World Bank President Jim Yong Kim said "the global economy dodged a potential catastrophe" with congressional approval of the deal to raise the $16.7 trillion US debt ceiling.

Analysts said on Thursday the handling of the crisis in the US makes it necessary and obvious for the international community to improve the financial system, especially in terms of the building of international reserve currency, but this will surely be a long process and people can't expect it to happen overnight.

"Anyway, the US dollar is still the currency used by the majority of the world's countries in their trade and the West still holds more power in the international financial institutions and affairs," Shen said.

"Potential currencies, such as the Euro and yuan are not ready to replace the role of the US dollar yet. Europe is still reeling from its own financial crisis and the internationalization of the yuan is now at the stage of building within China's neighboring regions," Shi noted.