HK and US talks not far-fetched amid trade warTop News | Phoenix Un 1 Nov 2018
Hong Kong may seek direct negotiations with the United States amid the Sino-American trade war, Acting Chief Executive Matthew Cheung Kin-chung said.
The trade war has affected the city, despite the US-HK Policy Act that ensures tariffs on mainland goods do not affect the SAR, cheung said at the annual forum of online media Master Insight. He said the SAR is very concerned that the United States has imposed tariffs on some goods exported from Hong Kong for alleged national security reasons.
Cheung slammed the US administration for imposing a series of protectionist measures which had taken international free trade "a great step backward."
He added: "World Trade Organization members should keep their promises and stay within the framework of the WTO, but the trade war that the United States has initiated has added a large variable to international trade.
"Hong Kong will be impacted directly and indirectly and will not be able to stay immune."
Cheung said the government will prepare for possible economic difficulties next year by strengthening the SAR's traditional industries and innovative businesses.
"There are no winners in trade wars and we still hope all sides will resolve trade disputes through bilateral meetings and WTO mechanisms. We won't rule out making requests for direct negotiations with the United States," he said.
Cheung said Hong Kong will seek to take part as a third party in WTO expert groups if any are set up to solve disputes.
He also reiterated that the government aims to boost expenses on research and development from 0.75 percent of Hong Kong's gross domestic product to 1.5 percent.
Cheung said Hong Kong was gifted in having four universities on the world's top 100 list, even though it only has a population of 7.3 million.
Associate professor of economics at Clemson University Kevin Tsui Ka-kin said China is more vulnerable during a trade war.
"The United States has a steadily growing economy with low unemployment, while China's economy is still growing - and the growth is not as rapid as in past years," Tsui said.
But former financial secretary Antony Leung Kam-chung believes China will benefit from the trade war.
"As the United States withdraws from global leadership, China can advance and replace [the Americans] to become the leader of the new globalization," Leung said.