Secretary of State Mike Pompeo announced on Wednesday that Hong Kong was not sufficiently independent from mainland China – an assessment that trade relations of the city, with the United States and employs a blow both American and Chinese companies that could jeopardize it. The news comes at creating a law of national security to Hong Kong following the decision last week in Beijing. The move came after Hong Kong Legislative Council in its obligations not to adopt such a law, since the former British colony, however, had his hand again to China in 1997. Critics say bypassing the local Chinese government legislator undermines the “high” the autonomy promised to Hong Kong when China resumed sovereignty over the territory of 7.4 million. “No reasonable person can say today that Hong Kong maintains a high degree of autonomy from China, as facts on the ground,” Pompey said in a statement. This autonomy is important because commercial privileges in Hong Kong with Washington depended on it. A decision in the White House what actions Pompey following assessment will last, but the options are the fees, visa restrictions, export controls and freezing the US assets of Hong Kong and Chinese officials as are in his intervention in the freedom of Hong Kong support Beijing. Officials realized that the move is not to target the people of Hong Kong. The US attempt to “the people of Hong Kong to ensure no negative impact on the most affected as possible,” David R. Stilwell, Assistant Secretary for East Asian and Pacific Affairs, however, said during a media conference call, on 27 May, companies are nervous, almost 300 US companies their regional headquarters in Hong Kong and more than 1,300 have operations in the city – 3M Goldman Sachs for the insurer AIG. In addition, there are about 85,000 US citizens living in Hong Kong. A spokesman for the American Chamber of Commerce last week said that “to develop fear factor for the economy.” From a business confidence it has been triggered since the six months of often violent protests last year, shaken by a litigation delivery bill, following which some companies have begun plans to move their operations. Now experts say Beijing, increasing the control of Hong Kong and possible trade restrictions from Washington could lower business confidence and the importance of Hong Kong as an international commercial center of compromise. “Companies will rapidly evolve their perception of Hong Kong as a gateway to China, protected by the rule of law,” says Benjamin Quinlan, CEO and managing strategic consulting partner Quinlan and Associates, who also sits on the board of FinTech Association. “If [special status of Hong Kong] Remove, is foreign companies that say: ‘Just enter China, I did not go one-up in Hong Kong,’ or will leave China completely alone,” says TIME. “It does not bode well for Hong Kong’s position as a global financial center.” What is the special status of Hong Kong? Although Hong Kong is part of China, which was in the position of Hong Kong Policy Act of 1992, the US is Hong Kong in contrast to the mainland when it comes to economic relations, on the things a different set of rules from rest of China application such as export controls, customs and immigration. The continuation of this special status will be different predicated on Hong Kong from mainland China. “One country, two systems” framework, a political formula that was in 1997, delivered on the spot, the city offers his own business enough space to solve, including an independent judiciary and freedom of assembly, press and speech. The enclave has its own currency, the Olympic team and based at the World Trade Organization. Business groups say that these properties are an important engine for the economic success of the city. “It would be a serious compromise mistake on many levels of special status of its Hong Kong, which is its role as a destination attractive investment and an international financial center is of paramount importance,” said the US Chamber of Commerce in a statement on Tuesday. adopted by Hong Kong Human Rights and Democracy in November 2019, after months of protests in Hong Kong law requires the State Department to complete an annual assessment to determine whether Hong Kong remains sufficiently China. This evaluation is necessary to justify the unique treatment of Hong Kong under United States law. What happens next? Scott Kennedy, senior presidential adviser and trustee for the Chinese economy and the economy at the Washington Center for Strategic and International Studies (CSIS) said that, while President Trump Time, “a menu of things he did would choose to do,” it was “a la carte menu or off the upper hand.” According to Kennedy, it is likely that things export controls on sensitive technologies would be adopted first as, with the most punitive tariffs come later. In his lecture on May 27, Stilwell said actions were “as much as possible to change behavior aligned.” The sanctions against officials or Chinese structures can the ability of Chinese companies to the damaged city in transactions, which in turn affects the ability of China to do international business in US dollars. But he warned the government against Hong Kong in a statement on May 28 that “all sanctions a double-edged sword that not only harm the interests of Hong Kong, but also significantly higher than in the US” Eswar Prasad, professor of Economics trade policy at Cornell University and former head of the Chinese division of the international monetary Fund says after revocation of the special status of Hong Kong will have a significant negative impact on trade and investment flows between the United States and Hong Kong. In 2018, foreign direct investment in the US $82.5 billion and US territory goods and services are traded in Hong Kong amounted to an estimated $66.9 billion $. Hong Kong is to maintain one of the few countries had a trade surplus with the United States amounted to $26.4 billion in 2019. The Key Success Hong Kong’s rule of law, but its longevity doubted say many businessmen. “If the Chinese lawmakers start things and this compelling legislators in Hong Kong do what they can do similar things on other issues such as national security start?” Asks Kevin Yam, a lawyer for financial regulation based in Hong Kong. A lawyer in a global law firm told Time that he had received requests from nervous customers in recent days, it can get away from Hong Kong law, trade agreements. “For companies of the United States and the financial institutions operating in Hong Kong, this would require a period of great uncertainty usher,” says Prasad, “especially since they can not count the much-touted rule of law in Hong Kong and at least independence modest by China. ” Kennedy believes that companies with offices in Hong Kong is likely to leave if the situation continued to deteriorate. “If Hong Kong loses its independent judiciary, freedom of the press, and all the things which he later estimated Hong Kong is not a safe haven in China and in the region for American companies that see their regional headquarters at the base of the majority part of their capital and large staff and have based their contracts, “he says. In Hong Kong hedge fund executive said that time was “concerned in any case” at the news. His company began considering alternative sites in Asia because of the events in Hong Kong last year, but had no significant decisions are made. Depending on how the situation pans out, you can get “speed up” the process of a contingency plan in place. Better for business? Officials in Hong Kong sought to allay concerns of international investors, saying that legislation on national security is required to ensure that there is no repeat of the mass demonstrations that Hong Kong for the second half of 2019. The protests plunged Hong Kong paralyzed in its first recession in a decade. Protests raged in the financial district for several weeks late last year. to disperse a crowd at lunchtime on Wednesday, riot police fired pepper balls that have had to protest at the central national security collection area, which houses the headquarters of many international banks and law firms. “While the impact of the recent direction of China to Hong Kong start to decline, there is a growing possibility is that investors lose confidence in Hong Kong’s unique legal structure of British law operating on Chinese soil,” says Kurt Tong, the ‘former US general -Konsul in the field, which is now a consulting partner of the Asian group. “In this way, the movement of people and money from Hong Kong happens snowball could start.” Others say that it may take a little ‘for the consequences of the law on national security needs business to see in the city. Some are even cautious optimism. “If the process is purely restricted to addressing the mass protests and what is not,” says Quinlan, “then you could argue the opposite point that companies see this as a better place to do business, especially those who are most affected from protest movements will be as retail and catering. “
US could withdraw the special status of Hong Kong. ‘Here’s what this means for the business as a global financial center
