Hong Kong warns removing US special status is ‘double-edged sword’

Hong Kong told the United States to keep out of the internal debate over new national security laws being imposed by China, and warned that withdrawal of the financial hub’s special status under U.S. law could backfire on the U.S. economy.

U.S. President Donald Trump is due to announce later on Friday his response to the Chinese parliament’s advancement of security legislation for Hong Kong, which many lawyers, diplomats and investors fear could erode the city’s freedoms.

The former British colony has been wracked by civil unrest amid fears Beijing is curbing the high degree of autonomy it has enjoyed under a “one country, two systems” formula put in place when it returned to Chinese rule in 1997.

“Any sanctions are a double-edged sword that will not only harm the interests of Hong Kong but also significantly those of the U.S.,” Hong Kong’s government said late on Thursday.

It added that from 2009 to 2018, the U.S. trade surplus of $297 billion with Hong Kong was the biggest among all Washington’s trading partners, and 1,300 U.S. firms were based in the city.

Beijing says the new legislation – likely to take effect before September after China’s parliament this week approved a decision to advance it – will tackle secession, subversion, terrorism and foreign interference in the city. It could see Chinese intelligence agencies set up bases in Hong Kong.

Beijing’s Ministry of Public Security said it would “guide and support” Hong Kong police, which is supposed to be independent from China.