US president Donald Trump speaks during a news conference in the Rose Garden at the White House in Washington, US on July 14, 2020.(Reuters Photo)
US president Donald Trump speaks during a news conference in the Rose Garden at the White House in Washington, US on July 14, 2020.(Reuters Photo)

Donald Trump ends Hong Kong’s special status with US to punish China

Donald Trump approved the legislation on Tuesday after spending weeks blaming Beijing for the coronavirus pandemic and criticizing its handling of Hong Kong.
By Bloomberg | Posted by Kanishka Sarkar
UPDATED ON JUL 15, 2020 03:30 AM IST

President Donald Trump said he issued an order to end Hong Kong’s special status with the US and signed legislation that would sanction Chinese officials responsible for cracking down on political dissent in Hong Kong, the latest escalation in tensions between the world’s largest economies.

“No administration has been tougher on China than this administration,” Trump said Tuesday at the White House.

Trump, speaking in the Rose Garden, announced both moves, and used the event to repeat attacks on his Democratic opponent, Joe Biden, portraying him as having been cozy with China during his time as vice president.

Trump approved the legislation on Tuesday after spending weeks blaming Beijing for the coronavirus pandemic and criticizing its handling of Hong Kong. The president has faced widespread criticism over his response to the virus, with cases once again surging as businesses reopen.

Under the United States-Hong Kong Policy Act of 1992, the US treats Hong Kong, a semi-autonomous part of China with its own legal and economic system, differently than the Chinese mainland in trade, commerce and other areas.

Trump said that his order meant that Hong Kong would now be treated the same as mainland China.

The bipartisan legislation that Trump also signed comes in response to the Chinese government’s new national security law for the former British colony, which critics say is aimed at quashing political protests and stifling dissent. People found guilty under the law could, in some cases, face life imprisonment.

Targeting Banks

The legislation would penalize banks doing business with Chinese officials involved in the national security law the country is seeking to impose on Hong Kong. It’s the latest in a series of efforts designed to pressure China amid tensions over the spread of the coronavirus, implementation of a trade pact finalized earlier this year, and efforts to tighten control over Hong Kong.

The legislation would require the State Department to report to Congress every year about officials who seek to undermine the “one country, two systems” model that applies to the special administrative region. It also gives the president the power to seize the assets of and block entry to the US for those individuals.

Under the legislation, banks are granted a kind of year-long grace period to stop doing business with entities and individuals the State Department determines to be “primary offenders” when it comes to undermining Hong Kong’s autonomy.

After that period, the Treasury Department can impose a variety of penalties on those institutions, including barring top executives from entering the US and restricting the ability to engage in US dollar-denominated transactions, according to Pat Toomey, a Pennsylvania Republican who co-sponsored the legislation.

Hong Kong Announcement

Trump announced last month that he would end preferential treatment for Hong Kong, and signed legislation aimed at punishing Chinese officials for oppression of Uighurs and members of other Muslim minority groups.

The tougher stance toward Beijing represents a pivot for Trump, who largely avoided human rights-related interventions as he was negotiating the first phase of his trade deal. On Monday, the US president said the deal was still “intact” because China was purchasing the promised agricultural products. But Trump also expressed frustration with the country over the spread of the coronavirus, which originated in Wuhan.

“What they did to the world should not be forgotten,” Trump said.

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