President Trump issued an executive order on Tuesday announcing a series of sanctions and US policy changes in retaliation for China’s recent restrictions on Hong Kong autonomy. “The situation with respect to Hong Kong, including recent actions taken by the PRC to fundamentally undermine Hong Kong’s autonomy, constitutes an unusual and extraordinary threat,” reads the order, which suspends Hong Kong’s preferential treatment as an autonomous territory, the termination of Fulbright scholarships for American students studying in Hong Kong, and extra screening precautions for Hong Kong immigrants to the United States.
The executive order was issued in conjunction with his signing of a bill, the Hong Kong Autonomy Act, imposing economic sanctions against China in response to the Hong Kong crisis. The bill broadens the discretion of American banks to unilaterally terminate or refuse loans to businesses in Hong Kong, allows the President to prohibit certain foreign exchange transactions at will, and permits the President to suspend the issuance of equity or debt instruments to banks within Hong Kong. The bill also details strict penalties for banks that fail to comply.
Earlier this month, China passed a new security law that restricted freedom of speech within Hong Kong by criminalizing secession, collusion with foreign powers, and subversion of state power. This law places further restrictions on demonstrations against restrictions on freedoms that have now been occurring for over a year.
China has responded harshly to the Hong Kong Autonomy Act. Foreign Ministry spokeswoman Hua Chunying condemned the measure at a press conference on Wednesday, saying that “The Act […] seriously violates international law and the basic norms underpinning international relations. It constitutes gross interference in Hong Kong affairs and China’s internal affairs. The Chinese government firmly opposes and strongly condemns this move by the United States.”
Hua further noted that Hong Kong is China’s territory and that laws passed in relation to Hong Kong should not concern the United States. She stressed that China’s security laws are in the national interest and help uphold the PRC’s sovereignty and security. “Hong Kong affairs are purely China’s internal affairs, said Hua. “No foreign country has the right to interfere.”
The measures authorized by the President executive order are subject to review in the event China changes its stance on Hong Kong. “If, based on consideration of the terms, obligations, and expectations expressed in the Joint Declaration, I determine that changes in China’s actions ensure that Hong Kong is sufficiently autonomous […] I will reconsider the determinations made and actions taken and directed under this order,” the executive order ends.