United States ending Hong Kong’s special trading status will hurt US firms, city’s American Chamber of Commerce says
- Chamber breaks silence, saying withdrawal of preferential treatment ‘will hurt American businesses in Hong Kong’
- Donald Trump signed the executive order this week in response to Beijing’s imposition of the national security law in Hong Kong
The biggest international business group in Hong Kong warned on Friday that the United States’ decision to revoke the city’s preferential trading status would damage American firms there.
“It will hurt American businesses in Hong Kong,” AmCham said.
Beijing vows to retaliate after Trump ends US privileges for Hong Kong
Other measures include increased barriers to Hong Kong importing American hi-tech goods and the cancellation of a US-backed student exchange programme.
AmCham said the policy act which took effect in 1997 helped the city play a crucial role in the global economy and protected US commercial interests in the Indo-Pacific region.
There are more than 1,300 American firms and 85,000 American citizens in Hong Kong.
“A thriving American business community in Hong Kong shapes Chinese and regional institutions and perspectives by modelling best business practices and the values of an open and competitive marketplace for goods and ideas,” it said.
“American businesses in Hong Kong have stressed the significance of fostering regional stability through exchanges between the United States and Hong Kong. Without the policy act this goal becomes much more difficult to achieve.”
On the day of the executive order, Trump also signed off a law to penalise mainland Chinese and local officials deemed to have trampled on Hongkongers’ rights.
The Hong Kong Autonomy Act will allow sanctions against individuals said to have undermined the city’s autonomy with the passage of the controversial national security law last month, and also punishes banks doing business with them.
What Trump’s executive order means for Hongkongers
Meanwhile, Standard Chartered Bank Greater China senior economist Kelvin Lau Kin-heng said he believed Hong Kong still maintained its competitive edge even without the preferential treatment.
“Hong Kong still offers free flow of capital, rule of law, a talented pool of people, and a simple and low tax regime,” he said.
But he conceded that the US claim that Hong Kong was no longer “sufficiently autonomous” would have ramifications for the city’s reputation as a global financial hub.
Lau predicted that Hong Kong, which already serves Beijing as the primary gateway between China and international financial markets, could even have a bigger role to play during escalating US-China tensions.
He said the stock exchange in the city could provide an alternative fundraising platform for larger mainland firms that listed in overseas stock markets.