Hongkong History of Special Status and the present problem.
Mike Pompeo, Secretary of State announced that now Hong Kong is no longer autonomous from China (warrant treatment under United States laws in the same manner as U.S. laws were applied to Hong Kong before July 1997). After Beijing’s announcement, this decision was taken and it was announced that it would draft sweeping national security legislation for the former British colony by sidestepping the city’s own legislature to outlaw secession, subversion and terrorism.
Hong Kong’s special status
Five years before Britain handed the control of Hong Kong to China on July 1, 1997, U.S. policymakers agreed that they will continue to treat the territory effectively as a separate entity from China beyond that date. So under the United States-Hong Kong Policy Act of 1992, the U.S. gives Hong Kong a special status as a part of China and agreements and in that agreement, it was stated that governing a wide range of interactions which also include commerce between the U.S. and Hong Kong will be predated the handover would remain in effect between both countries.
So from the U.S. perspective, Hong Kong is treated as separate from China in trade and economics in a long way. The U.S. also recognizes Hong Kong as a country of unique customs and that means the culture is largely spared from the upheaval of the U.S.-China trade war. Hong Kong is considered as one of the United States’ biggest export markets and as per reports, it also has a zero tariff rate on U.S. imports.
Hong Kong is one of the key global financial centres with a special status and they have earned a lot through a few decades of an open economy and rule of law. Investment flows into and out of China are a very critical conduit.
Now the question arises: what will change?
The United States government still has not revoked Hong Kong’s special status. Under an amendment made in 2019 to the U.S.-Hong Kong Policy Act, the new amendment states that the secretary of state is required to report all the matters to Congress at least once in a year on the special status of Hong Kong. Pompeo’s decertification of Hong Kong is much sufficiently autonomous when Beijing opens the door to concrete action by the administration, including possible sanctions.
According to the U.S. law, Hong Kong’s special treatment, they will always have a contingent on China abiding because of their promise to let the territory remain largely autonomous. This promise is mentioned in Hong Kong’s mini-constitution in the Basic Law, which gives permission to Hong Kong to manage its affairs in all areas but the matters including national defence and foreign policy are not included in this, it is mentioned under an arrangement called “one country, two systems. That means a country which is running on two different systems.
Because of this basic rule, the Hong Kong government is allowed to enact laws “on its own” to prohibit treason, secession, sedition, subversion, theft of state secrets, and to ban foreign political parties from conducting any kind of political activities in Hong Kong regarding any matter.
Since 2003 the Hong Kong government has failed due to widespread public opposition against them. Critics fear such laws are used to silence dissent or curtail civil liberties in Hong Kong. So the Communist Party of China has taken several matters into its own hands, and the drafting of national security legislation will unilaterally impose such laws on Hong Kong, circumventing Hong Kong’s own legislature.
What are the implications in this matter?
David Stillwell, Assistant Secretary of State for East Asian and Pacific Affairs said that the U.S will try to thread the needle when it comes to action.
Hong Kong has been a regional hub for American businesses for a very long time, drawn by Hong Kong’s free-market traditions, the rule of law and civil liberties. according to the U.S. Consulate around 1,400, U.S. firms have operations in Hong Kong. according to sources, in 2018 Bilateral trade was about $67 billion and the stock of U.S. foreign direct investment totalled more than $82 billion in 2017 according to the United States Trade Representative.