The Trump administration announced on Monday that it is revoking Hong Kongs special trading status and stopping its defense equipment exports to Hong Kong, in order to protect U.S. national security amid the passing of Beijings national security law for Hong Kong.
“With the Chinese Communist Partys imposition of new security measures on Hong Kong, the risk that sensitive U.S. technology will be diverted to the Peoples Liberation Army or Ministry of State Security has increased, all while undermining the territorys autonomy. Those are risks the U.S. refuses to accept and have resulted in the revocation of Hong Kongs special status,” Secretary of Commerce Wilbur Ross said in a statement.
“Commerce Department regulations affording preferential treatment to Hong Kong over China, including the availability of export license exceptions, are suspended. Further actions to eliminate differential treatment are also being evaluated.
“We urge Beijing to immediately reverse course and fulfill the promises it has made to the people of Hong Kong and the world,” he added.
The United States previously treated Hong Kong as a separate entity from mainland China in the areas of trade, investment, and immigration. This has meant that current U.S. tariffs on billions of dollars worth of Chinese goods have not applied to Hong Kong.
President Donald Trump had warned of the move to revoke Hong Kongs special status in late May as the Chinese Communist Party (CCP) moved to draft its so-called national security law. At the time, Trump also said that U.S. travel advisories would be updated “to reflect the increased danger of surveillance and punishment by the Chinese state security apparatus” following the national security laws approval.
The administration will also “take necessary steps” to sanction Chinese and Hong Kong officials “directly or indirectly involved in eroding Hong Kongs autonomy,” Trump said at the time.
Halt to Defense Exports
Secretary of State Mike Pompeo announced in a statement on Monday that in addition to stopping exports of U.S.-origin defense equipment to Hong Kong, the administration will also take steps to impose similar restrictions on Hong Kong as it does for China on U.S. defense and dual-use technologies.
“The Chinese Communist Partys decision to eviscerate Hong Kongs freedoms has forced the Trump Administration to re-evaluate its policies toward the territory,” Pompeo said. “As Beijing moves forward with passing the national security law, the United States will today end exports of U.S.-origin defense equipment and will take steps toward imposing the same restrictions on U.S. defense and dual-use technologies to Hong Kong as it does for China.”
“The United States is forced to take this action to protect U.S. national security,” he continued. “We can no longer distinguish between the export of controlled items to Hong Kong or to mainland China. We cannot risk these items falling into the hands of the Peoples Liberation Army, whose primary purpose is to uphold the dictatorship of the CCP by any means necessary.”
Pompeo said that the administrations decision seeks to “target the regime, not the Chinese people.”
“It gives us no pleasure to take this action, which is a direct consequence of Beijings decision to violate its own commitments under the U.N.-registered Sino-British Joint Declaration … given Beijing now treats Hong Kong as One Country, One System, so must we,” Pompeo said.
CCPs National Security Law
Beijing formally began the process of drafting a national security law for Hong Kong on May 28, after the National Peoples Congress (NPC) conducted a ceremonial vote.
The law would criminalize those who engage in activities connected to “subversion, secession, terrorism, and any interfering activities by foreign countries and outside influences” that the CCP sees as a challenge to its one-party governing.
The NPC is a ceremonial rubber-stamp that approves directives from the CCP. The central governments law will now go to Hong Kongs pro-Beijing chief executive officer Carrie Lam, who will need to issue a legal notice in the Government Gazette for the law to come into effect.
Lam on June 30 refused to comment on the status of the national security law for her city, despite local media reporting that the law has been passed in Beijing.