Chinese Premier Xi Jinping has bold and daring plans for Hong Kong, the semi-autonomous territory that has been the epicenter of million-man demonstrations against Beijing’s strong-arming since last summer. And those plans could severely complicate President Trump’s trade agenda with China.
Beijing’s announcement that it will ram through a national security law to give law enforcement authorities in Hong Kong more powers to crack down on what it terms as foreign-linked, secessionist troublemakers was the most controversial move Xi could have taken short of an all-out land invasion of the city. The “increasingly notable national security risks in [Hong Kong] have become a prominent problem,” Chinese state news agency Xinhua reported. The law under consideration would strip Hong Kong of a sizable portion of its sovereignty, a move the city’s pro-democracy activists justifiably call an infringement on the “one country, two systems” framework that has governed Hong Kong since 1997.
As one could imagine, Washington didn’t take the news well. Republican and Democratic lawmakers released a torrent of statements and tweets denouncing Beijing’s decision as an usurping of Hong Kong’s rights and an assault on the city’s autonomy. “Attempting to circumvent the HK legislature shows a complete disrespect for the rule of law,” House Speaker Nancy Pelosi tweeted on Thursday. Sen. Josh Hawley was more blunt, writing that “the USA cannot let this stand.” Sens. Pat Toomey and Chris Van Hollen quickly declared they were working on a bill to slap sanctions on any Chinese official who implemented the Hong Kong law.
Beijing’s announcement of yet another attempt to bring an end to the “one country, two systems” framework in #HongKong is deeply alarming. Attempting to circumvent the HK legislature shows a complete disrespect for the rule of law.
— Nancy Pelosi (@SpeakerPelosi) May 21, 2020
The USA cannot let this stand. Today I will introduce a resolution in the Senate condemning this attempted crackdown & call on all free nations to stand with #HongKong https://t.co/f6V9nVRoSf
— Josh Hawley (@HawleyMO) May 21, 2020
For Trump, this couldn’t come at a worse time. The president has never been especially sympathetic or interested in the protest movements against the Chinese Communist Party. Although Trump signed a law last year expressing support for Hong Kong’s democracy activists, he did so with reservation. The last thing he wanted was to do something that would jeopardize a trade negotiation with Beijing that, at that point in time, was highly vulnerable to breaking down. Fortunately for Trump, Washington and Beijing eventually arrived at a Phase 1 trade deal two months later.
That was the good news. The bad news: The Hong Kong issue will almost certainly stall the beginnings of a Phase 2 trade negotiation for the remainder of the year. Depending on how Trump responds to the latest developments, Phase 1 could even be at risk.
Trump is already deeply frustrated with China over its handling of the coronavirus. He also isn’t particularly pleased with Beijing’s execution of the trade agreement. Larry Kudlow may be going on television to reassure everyone that China is intent on meeting its commitments, but numbers don’t lie. Due in large part to the Chinese economy’s 6.8% contraction, Beijing is on track to miss its $200 billion import target of U.S. goods as stipulated in the Phase 1 deal.
If the numbers don’t improve, Trump could be staring at a trade deal fluttering in the wind rather than one he could use on the campaign trail to demonstrate his administration’s success in finally introducing reciprocity in the U.S.-China trade relationship. Now, rather than preparing those talking points for the campaign, Trump is musing about withdrawing from the agreement and severing the bilateral relationship entirely.
U.S. policy on China is always a balancing act. A slugfest in one area, like Hong Kong, could threaten cooperation in another, like trade. The trick for any foreign policy official or negotiator is trying to compartmentalize and insulate the positive from being swallowed by the negative.
Yet if the past four months are any indication of the future, there may not be much balancing left to do when the calendar hits November 2020.
Daniel DePetris (@DanDePetris) is a contributor to the Washington Examiner’s Beltway Confidential blog. His opinions are his own.
