President Donald Trump on Friday leveled an extraordinary broadside at the Chinese government, accusing it of a comprehensive “pattern of misconduct” and ordered U.S. officials to begin the process of revoking Hong Kong’s special status under U.S. law.
The U.S. as a result will no longer treat Hong Kong and China as separate entities for the purposes of extradition, customs, trade and visa issues, he said.
In Rose Garden remarks, Trump also attacked the World Health Organization, which he said was effectively controlled by Beijing.
“We will today be terminating our relationship” with the WHO, the president said, adding that the organization’s more than $400 million annual U.S. contribution would be diverted to other health groups.
The president said he would issue a proclamation to protect sensitive American university research from Chinese spying and bar some Chinese nationals from entering the U.S. He also directed an administration working group to evaluate Chinese corporations that are listed on U.S. financial markets as a potential target of additional restrictions.
The moves seemed certain to intensify growing U.S.-China tensions and risked unsettling financial markets that are still trying to regain their footing during the coronavirus pandemic.
Trump’s fury at China has escalated in recent weeks, as he has blamed Chinese officials for not doing more to contain the outbreak and warn the outside world of the danger. On Friday morning he tweeted simply “CHINA!”
The announcement follows Secretary of State Mike Pompeo’s statement earlier this week that Hong Kong was no longer sufficiently autonomous from mainland China to deserve separate treatment. Under the 1997 handover agreement with the United Kingdom, China agreed to preserve the former British colony’s Democratic system for 50 years. Xi’s decision to impose security legislation on Hong Kong directly rather than by working through the territory’s local legislature may mark the collapse of that “one country, two systems” approach.
The U.S. since 1992 has treated Hong Kong as a separate jurisdiction from China for the purposes of trade, customs and visa regulations.
Caught in the middle of the deepening U.S.-China dispute are more than 1,350 U.S. corporations with offices in Hong Kong. The erosion of the city’s freedoms, including an independent judiciary, threatens to turn one of the global economy’s financial centers into just another Chinese city and calls into question the rationale for such a sizable commercial presence there.
The Chinese National People’s Congress, the country’s rubber-stamp legislature, on Thursday approved a plan to impose national security legislation in Hong Kong. The move was denounced in a joint statement by the U.S., Canada, Australia and United Kingdom as in “direct conflict” with China’s promises in 1997 when it regained sovereignty over the former British colony.
“The United States may well have to do something the market doesn’t like in light of its longer term interests,” said Patrick Chovanec, economic adviser for Silvercrest Asset Management in New York. “But there is concern about whether the U.S. is in a spiral of escalation with China on several fronts.”
Friday’s action represents only the administration’s latest slap at Beijing. The president earlier this month pushed a federal retirement pension board to abandon plans to invest in Chinese securities. And the Commerce Department tightened limits on Chinese telecom giant Huawei’s ability to purchase American computer chips.
Just four months after Trump celebrated a partial trade deal with China, marking an apparent truce in a two-year-long diplomatic conflict, relations between the two countries have plummeted. The president has been openly displeased with China’s failure to quickly fulfill the trade deal’s terms, including massive additional purchases of American crops, energy products and manufactured goods.
In recent weeks, as the human and financial toll from the coronavirus pandemic soared, the president has lashed out at China in ever sharper tones. He has blamed Chinese officials for suppressing information about the initial outbreak late last year and refusing to cooperate in efforts to investigate its origins.
“Frankly the U.S. government is—I’ll use the word furious with what China has done in recent days, weeks and months, they have not behaved well and they have lost the trust I think of the whole western world,” Larry Kudlow, director of the National Economic Council, said Friday on Fox News.
On Thursday evening, Pompeo took a swipe at Trump’s predecessors in an interview on Fox News.
“President Trump is the first president—and this isn’t political—President Bush, President Obama, they all refused to recognize the threat that the Chinese Communist Party presented to the United States of America,” he said. “They were stealing intellectual property from us, they were moving in the South China Sea—all the things that you know. And presidents before just turned their head. They wouldn’t do it.”