World / China to impose retaliatory sanctions over US bill on Hong Kong

Beijing: China has vowed to retaliate after Donald Trump ordered an end to Hong Kong’s special status under US law to punish China for what he called “aggressive actions” against the former British colony.

Citing China’s decision to enact a new national security law for Hong Kong, the US president said he signed an executive order that will end the preferential economic treatment Hong Kong has received for years. “No special privileges, no special economic treatment and no export of sensitive technologies”, he told a news conference.

In a strongly worded response, China’s ministry of foreign affairs said no country has the right to interfere in what it deemed “purely China’s internal affairs”.

“US efforts to thwart the implementation of Hong Kong’s national security will never succeed. In order to defend its own legitimate interests, China will respond as necessary and impose sanctions on the relevant American individuals and entities.

“We urge the US to correct its mistakes. If the US stubbornly pursues this path, China will give a firm response.”

Acting on a Tuesday deadline, Trump also signed a bill approved by the US Congress to penalise banks doing business with Chinese officials who implement the new security law.

“Today I signed legislation, and an executive order to hold China accountable for its aggressive actions against the people of Hong Kong,” Trump said. “Hong Kong will now be treated the same as mainland China.”

The White House later released the full text of the executive order, outlining the penalties and suspensions, as well as newly reallocated admissions within the US refugee ceiling “to residents of Hong Kong based on humanitarian concerns”.

The order suspended multiple sections of legislation governing US immigration, arms exports and defence production, and eliminated US preference for Hong Kong passport holders as compared to People’s Republic of China passport holders.

It also suspended extradition and prisoner transfer agreements, took steps to end US training of Hong Kong police and security officers, and suspended or terminated academic partnerships with Hong Kong including the Fulbright exchange program.

The order allows for the freezing of US-based property and interests of foreign persons linked to the new national security laws, or found to be involved in international human rights abuses, or in the limiting or penalising of independent media and freedom of expression.

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.

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

US relations with China have already been strained over the global coronavirus pandemic, China’s military buildup in the South China Sea, its treatment of Uighur Muslims and massive trade surpluses.

North Korea’s leadership spoke out in support of China on Wednesday. “It is an extremely sinister act that a non-Asian country across the ocean, not being content with its reckless remarks over the issue of the South China Sea, has hurled abuses at the [Chinese Communist Party],” a foreign ministry spokesperson said.

Ending Hong Kong’s special economic status could be a double-edged sword for the United States. Hong Kong was the source of the largest bilateral US goods trade surplus last year, at $26.1bn, based on US Census Bureau data. It is also a major destination for US legal and accounting business. More than 1,300 US firms have offices there.

The former British colony was returned to Chinese rule in 1997 with a law protecting freedoms of speech, assembly and the press until 2047 under “one country-two systems”.

The legislation Trump signed calls for sanctions on Chinese officials and others who help violate Hong Kong’s autonomy, and financial institutions that do business with those found to have participated in any crackdown on the city.

Trump’s handling of the coronavirus pandemic has raised doubts about whether he can win re-election on 3 November amid a surge of new infections. He has attempted to deflect blame onto China.

“Make no mistake. We hold China fully responsible for concealing the virus and unleashing it upon the world. They could have stopped it, they should have stopped it. It would have been very easy to do at the source, when it happened,” he said.

Asked if he planned to talk to Chinese President Xi Jinping, Trump said: “I have no plans to speak to him.”

In rambling remarks, Trump spent much of his Rose Garden appearance criticising Democratic presidential rival Joe Biden. Both candidates are constrained from active campaign rallies by the virus and fears that participants could be infected.

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.

A US official, speaking on condition of anonymity, said the administration was also preparing sanctions against Chinese officials and entities involved in the Hong Kong crackdown, including further U.S. travel bans and possible Treasury sanctions.