Biden will warn US companies of the risks of operating in Hong Kong Business and Economy News


The U.S. will warn U.S. companies this week of the growing risks of operating in Hong Kong, three people familiar with the matter said, as Washington tries to increase pressure on Beijing’s crackdown on the financial center.

These risks include the Chinese government’s ability to access data that foreign companies store in Hong Kong, two of the people confirmed. The notice, which was first reported by the Financial Times, will be presented in the form of business advice, people said.

This alert from President Joe Biden’s administration would highlight how Washington’s concerns about the former British colony have increased since Beijing began cracking down on local democracy demonstrations in 2019.

A fourth U.S. official cited the territory’s national security measure passed last year as undermining the rule of law, which has allowed the business community to thrive in Hong Kong. U.S. officials argue that the law has weakened the borders between China and Hong Kong, which has been administered as a “special administrative region” with a separate system of government and economy since the British cession of the colony in 1997.

The United States is also concerned about a new law that would allow Beijing to retaliate against anyone who meets sanctions against China, the people said. The White House declined to comment.

The U.S. business warning would follow the Trump administration’s decision last year to withdraw special trade privileges granted to Hong Kong in recognition of China’s promise to ensure a “high degree of autonomy” in the city of Beijing.

US-China ties were already strained over issues such as tariffs and the origin of the Covid-19 pandemic when Biden took office in January. Relations have only intensified since then, and although Biden has met in person with counterparts from all over Europe, Russia, Japan and South Korea, he and Chinese President Xi Jinping have not yet met. .

The president of the United States is expected to attend a virtual meeting of the Asia-Pacific Economic Cooperation forum on Friday, including China. Later this month, Deputy Secretary of State Wendy Sherman plans to travel to Beijing, according to two people familiar with her plans. Biden and Xi could meet in person during a group meeting of 20 in Rome in late October.

Despite eroded ties between the world’s two largest economies, trade between the U.S. and China has continued to accelerate, fueled by consumer spending on the pandemic recovery.

Commercial data

Chinese data show that the nation’s merchandise exports to the U.S. are operating at a record pace so far this year, while U.S. figures indicate a much higher rate than in 2020 but lower than in previous years. Meanwhile, U.S. shipments to China are operating at record or near levels.

In response to reports on Tuesday, China’s Foreign Ministry reaffirmed its opposition to what it considers U.S. interference in Hong Kong affairs. Ministry spokesman Zhao Lijian told reporters that the city had been more stable under the security law.

These observations came before the United States updated its business advice by warning U.S. companies about the risks of supply chain links in the Xinjiang region, where China has been accused of a wide range of human rights abuses against Uighurs.

“The United States will continue to promote accountability for atrocities and other abuses in the PRC through a government-wide effort and in close coordination with the private sector and our allies and partners,” said Secretary of State Antony Blinken in a statement, in the People’s Republic of China.

In addition to growing tensions, China on Tuesday denounced Treasury Secretary Janet Yellen’s call for a “united front” against China.

On a visit to Brussels earlier this week, Yellen listened again to the association and the “rules-based international order” built after World War II, before calling on three countries and saying he put endangering this order.

“Together, we must counter threats to the principles of openness, fair competition, transparency and accountability,” Yellen said in statements he plans to deliver on Monday to EU finance ministers.

“These challenges include China’s unfair economic practices, malicious behavior, and human rights abuses; the abuses of the Lukashenko regime in Belarus; and Russia’s continued and growing malicious behavior, ”he said in some of his most notable criticisms to date in Moscow and Beijing.

“China deeply regrets and rejects the statements of Treasury Secretary Yellen,” Zhao said at a regular press conference in Beijing on Tuesday.

The latest events came as White House officials debated proposals for a digital trade deal covering Indo-Pacific economies, according to people familiar with the plans.

Details of the potential trade deal are still being drafted – part of an effort by the Biden administration to check China’s influence in the region – but the pact could include countries such as Australia, Canada, Chile, Japan and Malaysia. , New Zealand and Singapore, according to one person, who asked not to be identified because the process is not public.

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