US making ‘unnecessary’ link between human rights and trade, HK commerce chief Edward Yau says

10-Sep-2019 Intellasia | | 7:29 AM Print This Post

Hong Kong’s commerce minister believes Washington is trying to make “an unwarranted and unnecessary” link between its trade policy and the city’s human rights and development, and has urged the US to focus on the pair’s bilateral trading relationship.

Secretary for Commerce and Economic Development Edward Yau Tang-wah said Hong Kong’s autonomy was mandated in its mini-constitution the Basic Law, “which has nothing to do with any other jurisdictions”.

He also said Washington was dragging the anti-government protests into US-China trade talks, as the ongoing dispute caused serious collateral damage to the city.

“The US government should consider more how it handles US-Hong Kong bilateral relations when facing pressure from its Congress members,” Yau said. “The US and Hong Kong are on an equal footing under the World Trade Organisation trading status. So we should respect each other on a no-more-no-less basis.”

On Sunday, thousands of demonstrators marched to the United States consulate in Hong Kong and called on Washington to pass a law in support of the city’s democratic development and human rights.

US Congress members have vowed to prioritise passing a bipartisan bill, the Hong Kong Human Rights and Democracy Act, that would require an annual justification of the special treatment afforded by Washington to the city, including the special trade and business privileges, under the US-Hong Kong Policy Act of 1992.

The 1992 act shields Hong Kong from the tariffs President Donald Trump has imposed on mainland Chinese exports, but Yau said the indirect impact on the city could not be underestimated.

“There is every interest for Hong Kong to maintain its autonomy, which stems from constitutional rights, and has nothing to do with any legislation and policy of other jurisdictions,” Yau said.

Trump flirted with China’s red lines when he called on Beijing to humanely settle the civil unrest in Hong Kong, and urged President Xi Jinping to meet protesters.

The US president was rebuked by the Chinese Ministry of Foreign Affairs, which told him not to meddle in the country’s internal matters.

China and the US are expected to hold face-to-face talks in Washington early next month, at which Chinese vice-Premier Liu He pledged to make substantial progress to resolve the trade war.

“I expect a positive outcome, and progress to be made during the talks,” Yau said. “I have also psychologically prepared for an unforeseeable outcome. The trade war has dragged on for too long and Hong Kong has suffered the biggest collateral damage.”

Washington has so far levied punitive tariffs on $550 billion worth of Chinese goods. Beijing has responded with tariffs on $75 billion worth of American goods.

Yau said the city’s economy was under the combined impact of the trade war and persistent protests, which could push it into a technical recession between July and September.

In the second quarter, the economy contracted 0.4 per cent from the first quarter, putting it in its worst shape in a decade.

Fitch Ratings, one of the big three credit-rating agencies, downgraded Hong Kong’s sovereign rating on Friday, and raised doubts about the city’s governance amid its worst political crisis since the handover of sovereignty in 1997.

The agency also pointed to the growing risks from the trade war, and Yau said the Hong Kong government had put adverts in international newspapers last week aiming to update overseas clients on the situation in the city.

“As a Hongkonger, I hope to see the awakening of everyone from the ongoing situation, reconciliation and riding out of the storm,” Yau said. “Honesty is the best policy.”

As part of a package of relief measures for smaller firms in the city, reeling from the dual impact of the trade war and the political turmoil, two funds totalling HK$5.5 billion (US$700 million) have been made available, he said.

There is a HK$3.5 billion fund dedicated to branding, upgrading and domestic sales, while the export and marketing fund for small and medium-sized businesses amounts to HK$2 billion.

The electronics industry has become the latest victim of the trade war, with its products included in the $300 billion worth of China’s goods subject to 30 per cent tariffs to be imposed on September 1 and December 15.

While welcoming the relief measures, Steve Chuang, CEO of electronics maker ProVista, urged the government to negotiate with China’s Ministry of Commerce to see if Hong Kong manufacturers could be allowed to rent some space at its industrial estates overseas.

“This will help them settle down in an alien country faster, and easier, and hopefully in a more cost-effective manner,” he said.

Chuang added that factory relocation was urgently needed, partly because US orders for mainland factories tend to dry up in the forth quarter. His company, and the industry commonly, see a 30 per cent decline in orders in October year-on-year.

“This situation is even worse than that of the global financial crisis in 2008,” he said.

On Monday, Hong Kong’s government hit back at the United States’ efforts to introduce the Hong Kong Human Rights and Democracy Act.

In a rebuke reminiscent of Beijing’s rhetoric, a government spokesman said: “The Hong Kong Special Administrative Region (HKSAR) government expresses regret over the reintroduction of the act and reiterates that foreign legislatures should not interfere in any form in the internal affairs of the HKSAR.” The foreign ministry in Beijing has also urged the US not to interfere in Hong Kong’s affairs.

The Hong Kong government stated that the extradition bill that sparked mass protests in the past 14 consecutive weeks was fully withdrawn on September 4 after it was suspended almost two months ago.

The US had raised the Causeway Bay booksellers incident in 2015, in which five publishers and booksellers in Hong Kong disappeared before re-emerging in mainland China, it added. The episode gave rise to concerns that mainland law enforcement agents had operated in Hong Kong.

But the spokesman said: “The HKSAR government has all along been dealing with matters relating to the HKSAR in strict accordance with the principle of ‘one country, two systems’ and the Basic Law, and will not allow ‘law enforcement across the boundary’.”

It said Hong Kong’s special customs and trade status which are different from those in mainland China were guaranteed under the city’s mini-constitution, the Basic Law. It was not “an offering from other jurisdictions”, it said.


Category: Hong Kong

Print This Post