Business

China vows retaliation against US over Hong Kong sanctions

By CNBC, source: agencies

Beijing: China today (July 15) said it would retaliate after US President Donald Trump signed into law an Act allowing sanctions on banks over Beijing’s clampdown on Hong Kong.

The Hong Kong Autonomy Act “maliciously slanders” national security legislation imposed by Beijing on the city, China’s foreign ministry said in a statement.

“China will make necessary responses to protect its legitimate interests, and impose sanctions on relevant US personnel and entities,” the ministry said.

The foreign ministry also said that Beijing strongly opposes the latest US action and urged Washington to stop interfering in China’s internal affairs, state television reported.

“Hong Kong affairs are purely China’s internal affairs and no foreign country has the right to interfere,” it said.

Trump on Tuesday signed a law penalising banks doing business with Chinese officials who implement the new Hong Kong national security law.

“No special privileges, no special economic treatment and no export of sensitive technologies,” he said.

Critics of the security law fear it will crush the wide-ranging freedoms promised to Hong Kong when it returned to Chinese rule in 1997, while supporters say it will bring stability to the city after a year of sometimes violent anti-government protests.

The security law punishes what Beijing broadly defines as subversion, secession, terrorism and collusion with foreign forces with up to life in prison.

Double-edged sword?

Analysts say that completely ending Hong Kong’s special treatment could prove self-defeating for the United States.

Hong Kong was the source of the largest bilateral US goods trade surplus last year, at US$26.1 billion, US Census Bureau data shows.

According to the State Department, 85,000 US citizens lived in Hong Kong in 2018 and more than 1,300 US companies operate there, including nearly every major US financial firm.

The territory is a major destination for US legal and accounting services.

The United States began eliminating Hong Kong’s special status under US law in late June, halting defense exports and restricting the territory’s access to high-technology products as China prepared to enact the security legislation.

In May, Trump responded to China’s plans for the security law by saying he was initiating a process to eliminate the special economic treatment that has allowed Hong Kong to remain a global financial centre.

He stopped short then of calling for an immediate end to privileges, but said the moves would affect the full range of US agreements with Hong Kong, from an extradition treaty to export controls on dual-use technologies.

CAPTION:

Top: Pro-Beijing activists holding placards and flags hand over a petition at the US consulate general in Hong Kong. File photo: AFP / Anthony Wallace and published by CNBC

 

 

Nina
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