U.S. Officially Declares That Hong Kong Is No Longer Autonomous

U.S. Officially Declares That Hong Kong Is No Longer Autonomous

‘It is now clear that China is modeling Hong Kong after itself,’ said Secretary of State Mike Pompeo

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Updated May 27, 2020 6:57 pm ET

WASHINGTON—The State Department determined that Hong Kong no longer has a high degree of autonomy from China, Secretary of State Mike Pompeo said Wednesday in a statement likely to unsettle the global financial center and certain to aggravate Beijing.

The determination, required under federal law, amounted to a U.S. condemnation of China’s announcement of plans to impose greater control over Hong Kong, a move which triggered renewed protests against Beijing. Mr. Pompeo’s decision also comes at a time of growing strains between Washington and Beijing over the worldwide Covid-19 pandemic, technology and a widening rivalry for global influence.

The State Department is required under the 1992 Hong Kong Policy Act to assess the extent of the former British territory’s autonomy from China. It certified to Congress on Wednesday that Hong Kong is no longer autonomous.

The decision opens the way for President Trump to take a range of possible measures, from revoking special arrangements on trade to imposing sanctions on individuals involved in suppressing civil liberties in the territory.

“This decision gives me no pleasure. But sound policy-making requires a recognition of reality,” Mr. Pompeo said. “It is now clear that China is modeling Hong Kong after itself.”

Hong Kong has operated one of the freest economies in the world, even in the 23 years since Beijing took control of the territory from Britain, granting it limited autonomy. The U.S. endorsement of Hong Kong’s special status has served as a seal of approval of the city’s role as a global financial center with Western-style rule of law. The new assessment is likely to diminish confidence among U.S. and other foreign businesses in Hong Kong.

The special status has permitted U.S. exports of advanced technology equipment to Hong Kong that may not be sold elsewhere in China. It also has provided U.S. support for Hong Kong’s separate representation on global bodies from the World Health Organization to the Asian Development Bank.

The U.S. action doesn’t change Hong Kong’s international status and representation in such organizations, but could begin to call into question whether those arrangements should continue.

Jude Blanchette, a China expert at the Center for Strategic and International Studies in Washington, said the Trump administration may adopt a menu approach and revoke some of the benefits Hong Kong has been granted under U.S. law, or it could move to wipe away all the special treatment measures at once.

“This is a gasoline bomb on an already rapidly deteriorating situation and again, it just shows there’s emerging flashpoints in this relationship which no one’s predicting,” Mr. Blanchette said. “For companies and investors, We just don’t know where a lot of these black swans are going to emerge from.”

Relations between the U.S. and China are at the lowest point in decades. Trump administration officials have stepped up criticism of Beijing in recent weeks, accusing China of deliberately concealing the threat posed by Covid-19 and blaming it for the pandemic that has wreaked havoc on the global economy. Trump administration officials have also suggested the virus may have originated in a Chinese lab and have accused China of attempting to hack organizations involved in vaccine research.

Beijing denies the accusations and accuses the U.S. of a role in the outbreak, even though the virus is known to have originated in Wuhan, China.

U.S. lawmakers also have assailed China’s treatment of minorities, particularly Muslim minority groups. Amid the strains, trade officials from both countries are trying to keep a trade deal on track, with the Trump administration saying last week that plans for the deal were intact.

The Hong Kong Policy Act, which was passed in the twilight of British rule and most recently amended last year, has allowed the U.S. to treat Hong Kong as a separate entity from mainland China. It requires the State Department to assess on at least an annual basis the extent of autonomy of Hong Kong from the People’s Republic of China.

Hong Kong hosts banks and securities firms from around the world and is still a gateway to the wider China market. Its reputation as an open international business city, however, has been rocked over the past year by at times violent protests against heavier handed rule by Beijing. Wednesday’s decision adds to the uncertainty.

Mr. Pompeo cited Beijing’s intention to unilaterally and arbitrarily impose national-security legislation on Hong Kong as a motivating factor for the decision. He said the U.S. government continues to stand with the people of Hong Kong in their struggle for autonomy. A U.K. spokeswoman said the government was also deeply concerned about the legislation and coordinating closely with allies on a response. Mr. Pompeo and U.K. Foreign Secretary Dominic Raab spoke earlier on Wednesday, according to the State Department.

A Chinese spokeswoman in Washington accused the U.S. of meddling in its internal affairs and said the pending national-security legislation had no effect on Hong Kong’s autonomy or the rights of residents and foreign investors. “We will take necessary countermeasures in response,” she said.

Last week, China announced its plan to impose new national-security laws that override Hong Kong’s system of self-governance. That move was a sign of the growing frustration within China’s leadership over the long-running and at times violent unrest that began last summer and has often targeted the Communist Party and other symbols of Chinese rule.

On Wednesday, protesters surrounded the city’ legislature, where a debate is taking place on a measure to criminalize disrespect for China’s national anthem.

Analysts have said that the Trump administration will need to balance any decertification decision that makes it painful for Beijing to execute on its plans against the need to maintain support for Hong Kong’s democratic-leaning population. Hong Kong residents enjoy benefits of their city’s special status, including easier entry to the U.S. than other Chinese citizens.

The expanding U.S.-China strains have prompted U.S. lawmakers on Capitol Hill to advance several measures targeting Beijing.

A bipartisan bill introduced last week would sanction officials and entities involved in the execution of new national-security laws in Hong Kong and penalize banks that do businesses with those entities. The Senate also passed legislation that would boot Chinese firms off U.S. stock exchanges unless U.S. regulators can inspect their audits.

The House passed a bill late Wednesday that would sanction officials involved in the suppression of Muslim minority groups in China. Broad bipartisan support expedited the approval of the measure, which passed 413 to 1. The Senate has already passed the bill, and it now heads to President Trump’s desk.

—Andrew Duehren contributed to this article.

Write to Jessica Donati at jessica.donati@wsj.com

Corrections & Amplifications
Secretary of State Mike Pompeo made a statement Wednesday on Hong Kong’s autonomy, and the State Department certified to Congress on Wednesday that Hong Kong is no longer autonomous. An earlier version of this article incorrectly said the statement and the certification both took place on Thursday. (May 27, 2020)

One comment

  1. I’ve always thought it was a very good idea. I don’t know why some people do not think so. I’m glad you do. I agree with you completely

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