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The president said the U.S. will crack down on Chinese companies listed on American exchanges. He directed the Presidential Working Group on Financial Markets to examine the practices of those businesses.
“Investing firms should not be subjecting their clients to the hidden and undue risks associated with financing Chinese companies that do not play by the same rules,” Trump said. “Americans are entitled to fairness and transparency.”
The U.S. is also revising its travel advisory for Hong Kong, warning that Americans could be spied on or arrested by the Chinese government, Trump said. And Chinese and Hong Kong city officials could face direct U.S. sanctions for “smothering” Hong Kong’s freedom.
Hong Kong has been an autonomous Chinese territory since 1997 when the U.K. returned its former colony via a treaty. The city was to remain an autonomous city for 50 years governed differently than mainland China under a “one country, two systems” deal, per that treaty.
The U.S. and other countries granted favorable treatment to Hong Kong as a result, helping it grow into a major financial hub. Hong Kong was the U.S.'s 10th largest goods export market in 2018. There were 1,300 American companies with business operations in Hong Kong, with $82.5 billion in U.S. foreign direct investment. American-Hong Kong trade was estimated at $66.9 billion that year, according to the U.S. Trade Representative’s Office.
"Hong Kong is no longer sufficiently autonomous to warrant the special treatment that we have afforded the territory since the handover," Trump said. "China has replaced its promised formula of 'one country, two systems' with 'one country, one system.'"
The move by Chinese officials to exert greater control over Hong Kong has also prompted a new wave of protests in the city.
Hong Kong residents stand to lose significant civil liberties under closer Chinese rule, according to critics of the new law. Several pro-democracy advocates in Hong Kong have reportedly already been arrested.
“This is a tragedy for the people of Hong Kong, the people of China, and indeed the people of the world,” Trump said.
Trump also announced the U.S. is “terminating” its relationship with the World Health Organization, blaming it on a disparity in funding paid by the U.S. and China, as well as the spread of the coronavirus.
“Chinese officials ignored their reporting obligation to the World Health Organization,” he said.
The funds the U.S. normally pays to the WHO – more than $450 million last year – will instead be directed to other public health groups, according to Trump.
More than 1 million people have died from COVID-19, including more than 100,000 in the U.S. Trump blamed Chinese officials for the virus’s spread.
“The world is now suffering as a result of the malfeasance of the Chinese government,” he said.
Check back for more on this developing story.