So who will feel the pain most?Editorial | Mary Ma 29 May 2020
Sino-American geopolitical conflicts are set to escalate after the National People's Congress defied the sanction threats from the US and voted yesterday to impose controversial national security legislation on Hong Kong.
How will US President Donald Trump react?
Hours before the vote in Beijing, his Secretary of State Mike Pompeo announced he had advised Congress that Hong Kong was no longer autonomous.
Pompeo's warning opened the door to certain possibilities.
Beijing must be concerned, but the concern was not enough to reverse President Xi Jinping's determination to proceed with the law. Leaders in Beijing must have studied how the US might react and evaluated the impact of each probable scenario.
Pompeo's warning was alarming, but predictably within Beijing's assessment.
It's probable that Washington will impose sanctions against some officials in Beijing and Hong Kong.
There are precedents for that. After Russia annexed the Crimea from Ukraine, Washington slapped sanctions on certain Russian companies and billionaires accused of supporting strongman Vladimir Putin.
But censuring individuals won't derail a country's policy.
Washington may also revoke Hong Kong's special trade status. If Trump opts for this option, the guess is that it will be a gradual process in order to give the 1,300 US companies here time to plan their retreat with a view to limiting losses. Those firms will bear the brunt of such action.
As long as Europe, Australia and other countries keep their doors open to the SAR, Hong Kong authorities will be able to absorb the move's marginal impact.
But a devastating response would be for Washington to find ways to decouple the Hong Kong dollar from the greenback.
Given its tiny size, Hong Kong is too small to leave its currency floating alone. Before the global economy shifts away from the US dollar, neither the euro nor the yuan can provide stability.
The big question is whether Trump will go for the nuclear option. At least for now, it is not visible on the horizon.
Looking forward, fears that local cases contravening the new security law would be tried in the mainland should abate a little in light of political talks about excluding judges of foreign nationalities from such cases.
Does this infer those cases will be tried in the SAR?
Hong Kong's judiciary is unique, with many judges who are permanent residents but of foreign nationalities serving at various levels of the judicial system. It would be unreasonable to shut them out of the cases and we should maintain the status quo of the judicial system.
Another concern is how the new law will be executed in the SAR. In any case, Hong Kong police should be entrusted with the power and not secret agents from the mainland.
A review on how the police might perform the additional role is preferred, and it is important to include safeguards protecting freedoms including that of speech.
The law's expansion to cover not just "acts" but also "activities" is further cause for concern.