President Donald Trump announced Friday the U.S. would sanction China over the government’s treatment of Hong Kong, saying “Hong Kong is no longer sufficiently autonomous.”
The financial sanctions will be targeted in order to leave the U.S. room for escalation if necessary, according to a fourth person familiar with the matter. Trump officials crafting the sanctions are wary of the impact on global financial markets and retaliation from Beijing, the person said.
The retaliatory measures won’t include withdrawl from the “phase one” trade deal Trump signed in January, two of the people said. The White House declined to comment.
China’s legislature has approved a plan to draft legislation that Hong Kong democracy advocates say will curtail freedom of speech and undermine the city’s independent judiciary.
That prompted Secretary of State Michael Pompeo to announce earlier this week that the administration no longer considers the city sufficiently autonomous under a 1992 law that allows for easier travel and trade between the U.S. and Hong Kong. The law also allows companies based in the Chinese territory access to American technologies deemed sensitive to national security that face export restrictions in mainland China.
Chinese officials earlier Friday called potential U.S. actions over Hong Kong “purely nonsense,” saying the matter was an internal affair and that essential freedoms in the city would remain intact.
Beijing urged the U.S. to stop its “frivolous political manipulation,” Chinese foreign ministry spokesman Zhao Lijian told reporters at a daily briefing, reiterating Beijing’s support for Hong Kong police in upholding the law. Chinese officials have indicated they may retaliate against U.S. firms over the president’s decisions.
Trump’s announcement follows weeks of growing anger toward Beijing within the White House. The president and his advisers have repeatedly blamed the Chinese government for the coronavirus outbreak that began in the country’s Hubei province but has killed more than 100,000 Americans — a far greater death toll than China has publicly reported.
“Frankly the U.S. government is — I’ll use the word ‘furious,’ at what China has done in recent days, weeks, and months,” Kudlow said. White House economic adviser Larry Kudlow told Fox News earlier on Friday. “They have not behaved well and they have lost the trust I think of the whole Western world.”
The U.S. outbreak and the associated economic collapse from social distancing practices adopted to curb the virus’s spread have damaged Trump’s prospects for re-election, public polling shows.
Trump has also expressed frustration that Chinese purchases of U.S. agricultural goods are lagging behind levels agreed to in the “phase one” trade agreement he signed with a delegation from Beijing in January.
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