Daily US Times: US President Donald Trump on Friday launched a blistering attack on Beijing, naming misdeeds that range from espionage to the violation of Hong Kong’s freedoms. Mr Trump announced unprecedented action against China that will plunge US-China relations deeper into crisis.
Mr Trump described the Chinese government’s moves to introduce the measure in Hong Kong as a “tragedy”.
He also targeted China for taking advantage of the US saying: “They’ve ripped off the United States like no one has ever done before,” as he decried the way Beijing has “raided our factories” and “gutted” American industry.
President Trump is facing re-election battles in November and it seems he is casting Beijing as a central foil he will run against in the remaining months of his re-election campaign.
Trump appeared Rose Garden at the weekend to announce the unprecedented action against China when US coronavirus death toll hit 100,000, and a massive protests broke out Minneapolis after the death in police custody an African American man. But in his press briefing, he mentioned neither, focusing instead on casting Beijing as an existential geopolitical threat.
He accused China for “espionage to steal our industrial secrets, of which there are many,” and announced steps to protect American investors from Chinese financial practices. He also accused Beijing of “unlawfully claiming territory in the Pacific Ocean” and threatening freedom of navigation.
The President also blasted China for passing a national security law that fundamentally undermines Hong Kong’s autonomy and announced that the US will no longer grant Hong Kong special status on trade or in other areas and instead will apply the same restrictions to the territory it has in place with China.
Trump outlined that the US will strip Hong Kong of the special policy measures on extradition, travel, customs and trade Washington had previously granted it.
Pull out of the WHO
Mr Trump also said he was “terminating” the US relationship with the World Health Organization (WHO) over its handling of Covid-19, claiming that China has “total control” over the organization of 194 member states. He said China had pressured the WHO to “mislead the world” over the origins of the pandemic. Trump administration has been strongly claiming that the virus appeared in the Chinese city of Wuhan, which Mr Trump described as the “Wuhan virus”.
He said that health funding would be redirected to “other worldwide and deserving, urgent global public health needs.”
The US President also said he would take a number of actions, including barring “certain foreign nationals from China” from entering the US and sanctioning officials in Hong Kong and China for their direct or indirect role in “smothering” Hong Kong’s freedoms.
The relationship between the two world power has been rocky since both of the countries added extra tariff to each other’s products. The long trade war is still running.
Richard Fontaine, the CEO of the Center for a New American Security, said: “US-China relations are in full crisis.”
“We’ve hit the floor and keep falling through it. Beijing will retaliate in response to the Hong Kong steps the administration takes, and then the ball will be back in the President’s court. Things will get worse — potentially much worse — before they get any better.”
Trump’s announcement of unprecedented action against China was a multi-part salvo in what has been a steadily escalating confrontation playing out over telecommunication, trade, student visas, the media, the South China Sea, the coronavirus and most recently, the question of Hong Kong’s autonomy.
The Cantonese-speaking territory was handed over from the UK to China in 1997 under an agreement that was meant to preserve Hong Kong’s autonomy in domestic matters, including the judiciary, and ensure its citizens could vote for their leaders.
Trump said Friday: “This week China unilaterally imposed control over Hong Kong security,” calling it “a plain violation of Beijing’s treaty obligations with the United Kingdom.”
As a result, Trump said Hong Kong “is no longer sufficiently autonomous to warrant the special treatment that we have afforded the territory” and his administration would “begin the process of eliminating policy exemptions that give Hong Kong different and special treatment.”
What will happen if US removes Hong Kong’s special status?
With a free economy and a competitive tax regime, Hong Kong is well-known as one of the world’s most important financial centers and it’s attracted many multinational companies to its shores. If Trump’s declared unprecedented action against China takes place, Hong Kong will be revoked many extra advantages.
It is also an important trade hub, but all of that could be in jeopardy if the US changes the way it deals with Hong Kong.
In 2018, Hong Kong was ranked with the 7th highest volume of trade with a total value of nearly $1.2tn. But much of that trade is made up of goods that pass into, or come out of, mainland China.
8% of mainland China’s exports to the US in 2018 and 6% of mainland China’s imports from the US in the same year, passed through Hong Kong.
This role as a gateway between the Chinese market and the rest of the world has put Hong Kong in a unique position, but different trade arrangements could change that.
Dr Tim Summers, a Senior Fellow at Chatham House, based in Hong Kong, said: “If there’s a new trade regime in place, that changes the calculation for companies.”
He said: “The people who are going to get hurt are businesses and consumers.”