US Likely to Warn Companies on Hong Kong Business... "Concerns Over China Risks"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Suhwan] The U.S. government is expected to issue a warning to its companies operating in Hong Kong about increasing business risks.

Along with the warning issued on the same day targeting companies linked to China's Xinjiang region, this additional measure appears to indicate that pressure against China is expanding into the private sector.

On the 13th (local time), Bloomberg News cited multiple sources reporting that the U.S. government is expected to issue such a warning within this week.

According to sources, the U.S. government is concerned that various data held by foreign companies operating in Hong Kong could be accessed by Chinese authorities.

The U.S. government believes that the business environment risks for foreign companies operating in Hong Kong have increased due to the Hong Kong National Security Law passed last year. In particular, sources added that this assessment was influenced by the possibility that the Chinese government could abuse this law to carry out various retaliatory measures against U.S. companies based in Hong Kong that participate in sanctions against China.

This warning measure is an additional step following the U.S. government's revocation of Hong Kong's special status last year, showing intensified pressure targeting Hong Kong. Previously, during the Trump administration last year, the U.S. government revoked Hong Kong's special status in response to the passage of the Hong Kong National Security Law.

This special status had been credited with driving the growth of Hong Kong's financial market by treating Hong Kong differently from mainland China in areas such as tariffs, investment, trade, and visa issuance.

Furthermore, on the same day, the U.S. government warned that U.S. companies and individuals face risks of violating U.S. laws when directly or indirectly involved in supply chains and venture investments related to the Xinjiang region, indicating that pressure on China is spreading comprehensively to the private sector.

Tony Blinken, U.S. Secretary of State [Photo by AP News]

Secretary of State Antony Blinken highlighted in a statement that the defining feature of this warning is the explicit mention that the Chinese government is committing genocide and crimes in the Xinjiang region.

Blinken emphasized, "The United States will continue to hold China accountable for its atrocities and abuses through whole-of-government efforts and close coordination with the private sector and allies."

Additionally, U.S. Treasury Secretary Janet Yellen made remarks aimed at countering China during her visit to the European Union (EU) headquarters in Brussels, Belgium, the previous day. She said, "We all must respond to elements that threaten the values of transparency, fair competition, and accountability," adding, "Among these threats are China's unfair economic practices and human rights abuses."

As high-ranking U.S. officials continue to make statements countering China, the U.S. government is reportedly advancing the Indo-Pacific Digital Trade Agreement, which is expected to increase economic pressure on China.

According to Bloomberg News, the U.S. government is considering pursuing a new digital trade agreement with Asian countries including Canada, Chile, Japan, Malaysia, Australia, New Zealand, and Singapore. The digital trade agreement aims to establish various standards related to the digital economy, such as the use of big data, trade facilitation, and tariff policies on electronic products.

This push for a trade agreement is interpreted as reflecting the Biden administration's intention to check China's economic influence while establishing new trade relationships with countries in the Indo-Pacific region.

This content was produced with the assistance of AI translation services.