'The end of Hong Kong'? China's new plan for the region has Trump fuming

China is set to impose new national security legislation on Hong Kong after last year’s pro-democracy unrest, a Chinese official said on Thursday, drawing a warning from President Donald Trump that Washington would react “very strongly” against the attempt to gain more control over the former British colony.

The US State Department also warned China, saying a high-degree of autonomy and respect for human rights were key to preserving the territory’s special status in US law, which has helped it maintain its position as a world financial centre, the Reuters reported.

China’s action could spark fresh protests in Hong Kong, which enjoys many freedoms not allowed on the mainland, after often violent demonstrations of 2019 plunged the city into its deepest turmoil since it returned to Beijing’s rule in 1997.

Trump, who has ratcheted up his anti-China rhetoric as he seeks re-election in November, told reporters “nobody knows yet” the details of China’s plan. “If it happens we’ll address that issue very strongly,” he said.

Zhang Yesui, spokesman for the China’s National People’s Congress, said details of the legislation would be given on Friday when the parliament holds its annual session.

“In light of the new circumstances and need, the National People’s Congress (NPC) is exercising its constitutional power” to establish a new legal framework and enforcement mechanism to safeguard national security in Hong Kong, he told a briefing.

The “Hong Kong Human Rights and Democracy Act” approved by Trump last year requires the State Department to certify at least annually that Hong Kong retains enough autonomy to justify favourable US trading terms.

US Secretary of State Mike Pompeo said on May 6 he was delaying this assessment to account for any NPC actions.

If the State Department decertifies the territory, it would still ultimately fall to Trump whether to decide to end some, all, or none of the privileges Hong Kong currently enjoys.

On Thursday, Democratic and Republican US senators said they would introduce legislation to strengthen the Hong Kong act’s sanctions provisions.

Wall Street ended lower on Thursday as US -China tensions raised doubts about a trade deal reached this year between the world’s two largest economies. Tensions have heightened significantly in recent weeks, with bitter exchanges over the coronavirus.

Pro-democracy demonstrators have for years opposed the idea of national security laws, arguing they could erode the city’s high degree of autonomy, guaranteed under the “one country, two systems” formula in place for two decades.

A senior Hong Kong government official said details on the move and its implementation remained unclear, but Hong Kong media have reported the legislation would ban secession, foreign interference, terrorism and all seditious activities aimed at toppling the central government.

US State Department spokeswoman Morgan Ortagus said any Chinese move to impose legislation that did not reflect the will of the people would be highly destabilising and met with strong condemnation.

Ending Hong Kong’s special status would be a big blow for US firms. The State Department says 85,000 US citizens lived in Hong Kong in 2018 and more than 1,300 US companies operate there, including nearly every major US financial firm.

A previous attempt to introduce Hong Kong national security legislation, known as Article 23, in 2003 was met with mass peaceful protests and shelved.

Online posts had urged people in Hong Kong to protest on Thursday night and dozens were seen shouting pro-democracy slogans in a shopping mall as riot police stood nearby.

Opposition lawmakers said the move would gravely wound Hong Kong’s reputation as a financial centre and its autonomy.

“If this move takes place, ‘one country, two systems’ will be officially erased,” said democratic lawmaker Dennis Kwok. “This is the end of Hong Kong.”

Daniel Russel, the top US diplomat for Asia until early in the Trump administration, suggested Chinese President Xi Jinping might see “muscle-flexing” on Hong Kong as a means to make up for a series of setbacks, most notably the coronavirus pandemic that began in China - despite the risk of severe economic consequences for Hong Kong, China and others.