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Alan Hoo

In the negotiations between the British and Chinese governments leading up to the Joint Declaration, the major anxiety for Hongkongers was the possible extension of the mainland socialist system to Hong Kong. This was quickly laid to rest by the Chinese government’s “one country, two systems” formula.
This framework allowed Hong Kong to retain its capitalist system after the handover. The resultant provision in Article 5 of the Basic Law states: “The socialist system and policies shall not be practised in the Hong Kong Special Administrative Region, and the previous capitalist system and way of life shall remain unchanged for 50 years.”
Chapter V of the Basic Law acts as a charter for capitalism, granting Hong Kong autonomy in all its economic affairs. The city “shall be a separate customs territory” and may “participate in relevant international organisations and international trade agreements”.
Hong Kong was thereby able to become a separate member of the World Trade Organization and it led to the US-Hong Kong Policy Act recognising Hong Kong’s trade and economic autonomy.
However, the recent passing of the Hong Kong Economic and Trade Office (HKETO) Certification Act by the US Congress threatens to destroy this autonomy. If the act is signed into law, American firms might have to deal with the Chinese embassy and consulates on trade matters related to Hong Kong.
This is part of a package of anti-China measures making its way through Congress. The targeting of Hong Kong started under president Donald Trump when he declared Hong Kong would be “treated the same as mainland China”.

The new US bill, if also passed by the Senate, would destroy the separation of “two systems” guaranteed by the Joint Declaration. The US position seems to be that the ship of Hong Kong has already sunk, so let’s treat it like just another mainland Chinese city. No regard is being shown for the views and interests of the 7.5 million people still on board.
The Hong Kong government has said the US House of Representatives’ “fact-twisting attack on Hong Kong is politically driven, violates international law and the basic norms governing international relations, and grossly interferes in the affairs of Hong Kong”.
The Hong Kong government also described the US bill as “a self-deception of double standards”. But what can Hong Kong do in such a situation? Although it is taking flak from the West amid a bout of China-bashing, Hong Kong cannot rely on mainland China to fight its case in matters related to Hong Kong’s trade autonomy.
Indeed, Hong Kong is a founding member of the WTO. In 2021, the Hong Kong government brought a case before the WTO’s Dispute Settlement Body against the US requirement that Hong Kong goods be marked as originating in China, on the grounds that it is inconsistent with the most-favoured-nation treatment required under the General Agreement on Tariffs and Trade 1994.

The US lost the case and is appealing, but the appeal is not being handled because the US has been blocking the appointment of new members to the WTO Appellate Body. The US bill seeking to shut Hong Kong’s trade offices similarly violates the most-favoured-nation principle.
There is another avenue the Hong Kong government should explore: appointing a new Hong Kong commissioner for economic and trade affairs in the US.
According to Hong Kong government papers from 1996, the post was created in May 1993 to strengthen the city’s representation in Washington, “to ensure that congressional and business leaders were fully aware of Hong Kong’s interests and concerns, to promote Hong Kong more widely” and to oversee and coordinate the work of the three Economic and Trade Offices in the US.
The US being the “second most important trading partner as well as a major foreign investor in Hong Kong”, it is “essential that the Hong Kong case is well presented in the right quarters in the US,” the papers said.

For reasons unknown, the said post was not filled when it fell vacant in September 2021, during a period of intense focus on Hong Kong after the National People’s Congress passed a national security law for Hong Kong in 2020. This was a time for a Hong Kong commissioner to explain the events of 2019 in Hong Kong and the necessity for the immediate implementation of national security legislation to US Congress members and other concerned parties.
The Hong Kong commissioner would also be able to give relevant sectors of Hong Kong society a heads-up on any US Congressional measures targeting Hong Kong, so representations could be made in good time on behalf of Hong Kong.
US Congressional hearings are the principal method by which evidence is presented to a House or Senate committee and decisions are made. It is therefore axiomatic that procedural justice must be observed and the party that is to be subject to a congressional act has a fundamental right to be heard, as a cardinal principle of natural justice.
However, the residents of Hong Kong were not afforded a hearing before the US made decisions to deprive Hong Kong of its economic and trade autonomy. This autonomy is the bedrock of one country, two systems. The passage of the Hong Kong Economic and Trade Office Certification Act by the US Congress is therefore an act that serves only the prevailing political interests of the US but not the interests or welfare of Hong Kong’s 7.5 million inhabitants.


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Why is the US trying to kill off Hong Kong’s trade autonomy?

Illustration: Craig Stephens

People walk in front of the US Capitol in Washington, DC, on September 3. The recent passing of the Hong Kong Economic and Trade Office (HKETO) Certification Act by the US Congress threatens to destroy the city’s trade autonomy. Photo: EPA-EFE

The Hong Kong Economic and Trade Offices in San Francisco, in a picture taken in 2021. Photo: Frank Chen

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Hong Kong’s capitalist system depends on its ability to exercise its trade and economic freedoms enshrined in the Basic Law. The city must defend them


Hong Kong’s capitalist system depends on its ability to exercise its trade and economic freedoms enshrined in the Basic Law. The city must defend them.


Hong Kong national security law (NSL)

Hong Kong Basic Law

Hong Kong politics

US-China relations

Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)


Why is the US trying to kill off Hong Kong’s trade autonomy?

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Hong Kong’s capitalist system depends on its ability to exercise its trade and economic freedoms enshrined in the Basic Law. The city must defend them

Hong Kong’s capitalist system depends on its ability to exercise its trade and economic freedoms enshrined in the Basic Law. The city must defend them