President Trump has signed new legislation and an executive order that aims to hold China accountable for its treatment of Hong Kong in the wake of a newly imposed national security law.
On Tuesday, the president said he had signed a Congressionally approved bill that would penalize banks doing business with the Chinese officials tasked with implementing Beijing’s order, according to a report from Reuters. Trump also said he signed an executive order that would punish China for its “oppressive actions” against Hong Kong by putting an end to the preferential trade status that the region has enjoyed for years.
President Chinese President Xi Jinping signed the Hong Kong national security law in late June. While the legislation remains nebulous in the eyes of outsiders, the government in Beijing has said the ruling will prohibit the semi-autonomous region from seceding from Mainland China or subverting its authority.
Trump said the U.S. would afford “no special privileges, no special economic treatment and no export of sensitive technologies” to Hong Kong, which is classified as a special administrative region of Mainland China and has maintained its own governing system since it was handed over by the U.K. in 1997.
“Hong Kong will now be treated the same as Mainland China,” Trump said in Tuesday’s press conference. A White House fact sheet also noted that the executive order would revoke special treatment for Hong Kong passport holders, Reuters reported.
The move is not a wholly unexpected one, given that a bitter two-year trade war between the U.S. and China continues to rage on without resolution. The Trump administration has also repeatedly blamed the global superpower for the worldwide spread of the coronavirus.
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The moves to penalize China’s dictatorial actions will undoubtedly leave Hong Kong caught in the crossfire, however. A world-class hub for the luxury retail sector, the region has already been suffering economically since political unrest began to take shape last spring.
Riots and protests that began as a pro-democracy push against China in March of 2019 have continued for more than a year. The social unrest has pummeled the region’s retailers, which have been forced to shutter their businesses intermittently in key shopping districts.
In January, luxury sales dropped 21.4 percent as coronavirus fears swept the region, keeping shoppers at home. Hong Kong also counts on patronage from tourists from Mainland China, but trade has been constricted due to coronavirus border restrictions that disrupted the movement of people into the city. May retail sales tumbled 32.8 percent year over year to about $26.8 billion, according to the Hong Kong Retail Management Association (HKRMA), while January-through-May sales saw a 34.8 percent slump versus the prior-year period. In April, HKRMA said it expects 25 percent of the region’s stores to shutter this year, according to Reuters, though the group conducted its survey before the government triggered $17.7 billion in aid to businesses and residents in the region.