China lectures US on 'responsibility' over debt default Yet despite dire warnings from economist and the anxious entreaties of foreign governments, Democrats and Republicans on Monday remained gridlocked and the US government shut down for a seventh consecutive day. State John Kerry is welcomed by Indonesian beauties at the APEC Summit (EPA) The political deadlock left Mr Obama unable to attend the two-day Asia-Pacific Economic Cooperation (APEC) summit where the president had planned to press home his so-called "pivot" towards Asia by giving impetus to a new transpacific trade pact. In his absence, the leaders of Russia and China took centre stage. Xi Jinping, the Chinese president who has adopt an increasingly muscular trade policy in the South China Sea since coming to office in March, was left free to push China's credentials as the regional superpower who should not be constrained by US policies in the area. "China cannot develop in isolation of the Asia-Pacific and the Asia-Pacific cannot prosper without China," he said, adding that there was "enough space to sail together" despite differences with Tokyo and Washington. Mr Obama's seat around the table was taken by John Kerry, the US Secretary of State who was forced to push back against the sense that his boss's absence had left a political power-vacuum at the centre of the summit in Bali, Indonesia. "I want to emphasise that there is nothing that will shake the commitment of the rebalance to Asia that President Obama is leading," Mr Kerry told a business forum on the sidelines. Leaders at the summit - where a year-end deadline to finalise Mr Obama's Trans-Pacific Partnership is also fast approaching - put a brave face on Mr Obama's absence, although some openly admitted that his absence had cost the process much-needed momentum as it entered its crucial final phases. The Russian president, Vladimir Putin, said he understood that Mr Obama had had no choice but to cancel his trip to Asia, but also issued a reminder about how much was at stake as the politicking continued in Washington. Vladimir Putin shakes hands with John Kerry before a family photo ahead of the APEC gala dinner (AFP) "The US dollar is still the biggest reserve currency in the world," he said, "so it is of utmost importance to all of us." On Monday Republicans said they would not vote to raise the US debt ceiling unless they received policy concessions on spending and Mr Obama's healthcare reforms. The White House says it will not be held to ransom over something as fundamental as the "full faith and credit" of the United States. Behind the scenes, US Treasury officials admitted to The Telegraph that the shutdown was a growing source of embarrassment, weakening America's own credibility when it came to urging both China and the European Union to make financial reforms. As well as the Trans-Pacific Partnership, the shutdown has also hit another of Mr Obama's flagship trade projects designed to entrench the free trade 'rules of the road" in the face of a rising China. Talks in Brussels over the nascent transatlantic EU-US trade deal, the Transatlantic Trade and Investment Partership (TTIP), were cancelled this week as the US negotiators were put on unpaid leave.