China-US conflict: Pompeo threatens to rescind Hong Kong’s special trade status in new row

China-US conflict: Pompeo threatens to rescind Hong Kong’s special trade status in new row

Mr Pompeo said that Hong Kong was no longer autonomous from China and as a result did not merit special treatment under US law. The declaration is likely to have huge economic implications for China, as it threatens Hong Kong’s status as a trade hub and international financial centre. Mr Pompeo’s remarks came in response to Beijing’s plan to impose a draconian new security law, which would ban treason, secession, sedition and subversion in the former British colony.

Critics have argued that the newChina law is a blatant attempt to curtail freedoms granted to Hong Kong in the mini-constitution that was agreed when the territory returned to Chinese rule in 1997.

In a statement on Wednesday, the US Secretary of State said China’s plan to impose the new security legislation in Hong Kong was “only the latest in a series of actions that fundamentally undermine Hong Kong’s autonomy and freedoms.”

“No reasonable person can assert today that Hong Kong maintains a high degree of autonomy from China, given facts on the ground,” he said.

“After careful study of developments over the reporting period, I certified to Congress today that Hong Kong does not continue to warrant treatment under United States laws in the same manner as US laws were applied to Hong Kong before July 1997.”

He added: “It is now clear that China is modelling Hong Kong after itself.”

Until now the US has given Hong Kong special status under US law.

The provision dates back to when the territory was a British colony and gives it favourable trading terms.

However, last year Congress passed the “Hong Kong Human Rights and Democracy Act”.

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He warned: “Once the law is implemented, Hong Kong will be assimilated into China’s authoritarian regime, on both rule of law and human rights protections.”

He claimed the new security law would create “massive damage to expats and investors in Hong Kong”.

Maintaining the city’s autonomy was the “only way” to protect business, he added.

Mr Pompeo’s threat to remove Hong Kong’s special trade status could jeopardise billions of dollars worth of trade between Hong Kong and the US.

The move could also seriously impact China’s ability to attract foreign investment into the country, as Hong Kong serves as a conduit for international investors wanting to invest in China.

In 2018, the former UK territory received USD 115 (£94) billion in foreign direct investment.

Beijing has argued that its new security law is necessary to help it combat the growing political unrest that has gripped the territory in recent months.

Tensions between Hong Kong and mainland China were ignited last year, after Beijing attempted to introduce a bill to allow criminal suspects to be extradited to China to face trial.

This led to an outbreak of mass street protests, which eventually forced the authorities to abandon the bill.

Published at Wed, 27 May 2020 23:24:00 +0000