China condemns US over Hong Kong. That won’t stop trade talks

China vented Thursday after President Donald Trump signed new human rights legislation covering the protest-wracked city of Hong Kong. It denounced the new law as illegal interference in its own affairs. It summoned the US ambassador for the second time in a week. It vowed retaliation.

The threats sounded severe. They also sounded empty.

Behind the harsh rhetoric, China has few options for striking back at the United States in a meaningful way. And it has bigger priorities — namely, ending the increasingly punishing trade war between the two countries. Though both sides are talking about their willingness to reach a deal, they have yet to sign even an interim pact that would head off potentially damaging new tariffs less than three weeks from now.

On Thursday, Beijing’s main agency on trade remained quiet on the legislation even as other officials railed against it, suggesting that the government remained open to a trade deal and would let the volatile issue of Hong Kong simmer, at least for now.

“Beijing will make a lot of noises but they can’t afford to do much,” said Steve Tsang, director of the SOAS China Institute in London, a research Centre. “The trade deal is so important to the Chinese that they won’t let anything upset it.”

On the face of it, Trump’s signature on two bills looks like a direct brushback against Beijing’s rule over Hong Kong. The former British colony operates under its own laws but has come increasingly under the sway of Beijing, one reason behind the increasingly violent protests that have troubled the Chinese territory for five months.

The first bill authorises the US government to impose sanctions on Chinese or Hong Kong officials responsible for human rights abuses there. The second bill bans the sale of American-made tear gas, rubber bullets or other crowd-control equipment to Hong Kong authorities.

China’s reaction was immediate but unspecific. It summoned Terry Branstad, the US ambassador to China, to complain about the Hong Kong legislation, after doing the same thing just three days ago. Hu Xijin, the well-connected editor of the nationalistic Global Times tabloid, said China could retaliate by banning the legislation’s drafters from China and Hong Kong, a move that would be symbolic at best.

At a daily news conference in Beijing on Thursday, Geng Shuang, a spokesman for China’s Foreign Ministry, said Beijing may take unspecified countermeasures.

“This so-called act will only make the broad Chinese people, including their compatriots in Hong Kong, more aware of the sinister intentions and hegemonic nature of the US,” he said, adding that “the plot of the US side is doomed to failure.”

Still, asked about trade, Geng said only that the United States should not implement the law “so as to not affect China-US relations.” And at its weekly news conference Thursday, China’s Commerce Ministry — the arm of the Chinese government directly involved in trade talks — did not mention the US legislation.

The Trump administration has sent its own signals that it does not want the Hong Kong legislation to derail trade talks. Trump signed the bills in private, outside the presence of lawmakers, photographers and television crews. He also said, without offering specifics, that some of the provisions might infringe on the constitutional prerogatives of the presidency to oversee foreign policy, suggesting he may not implement them.

Still, thousands of people turned out Thursday night in Hong Kong for a “Thanksgiving” rally to celebrate the signing of the bills.

And while the Chinese government sees the unrest in Hong Kong as a test of its strength and authority, it has reasons to put the economy first.

The trade war has contributed to an economic slowdown that has sent growth to its most sluggish pace in nearly three decades. Economic indicators in recent weeks suggest the slowdown has continued, if not worsened. The Communist Party governs with undisputed power in China based on a promise of a better life, so a slowdown could present a direct challenge to its rule.

At the same time, China has come to realise in recent weeks that it needs massive imports of meat to offset an epidemic that has killed half or more of the country’s pigs. The United States is the world’s second-largest producer of pork after China, the second-largest soybean producer for animal feed after Brazil and the largest beef producer.

China and the United States are far from ending their trade war. But both sides are trying to reach a stopgap pact, called the Phase 1 trade agreement. Reaching a deal could forestall another round of US tariffs set to go into effect Dec 15 on even more Chinese imports, including consumer goods like smartphones and laptops.

Chinese negotiators “feel that they’re getting enough out of the trade talks not to let other issues, like North Korea and other questions, get in the way,” said James Green, who was the top trade official at the US Embassy in Beijing until last year and is now a senior associate at McLarty Associates, a Washington consulting firm.

China has let similar affronts pass without meaningful retaliation in recent months as it tries to seek a deal. For example, Chinese officials continued to negotiate after Canadian authorities at the behest of Washington last year arrested a top executive of Huawei, the Chinese telecommunications giant. Negotiations continued also after the United States put more than two dozen Chinese companies and organisations on a blacklist over human rights concerns.

Beijing could take a similar approach to Hong Kong, where its problems would be difficult to solve quickly in any case.

Large-scale protests began in Hong Kong in June over a bill that would have allowed the extradition of Hong Kong residents and visitors to the opaque and often harsh judicial system in mainland China. While that Hong Kong government bill was finally withdrawn this fall, protesters have broadened their goals to include the introduction of universal suffrage and a general amnesty for several thousand demonstrators who have been arrested at protests.

The unrest led to a major setback for Beijing on Sunday, when Hong Kong residents voted overwhelmingly in favour of anti-government candidates in elections for neighbourhood councils. The results signalled broad discontent with the territory’s Beijing-aligned leaders and undermined a Communist Party narrative that a silent majority in Hong Kong opposed the protests but dared not speak out.

Despite the setback, Beijing may now have the freedom to play the long game with Hong Kong. Tensions have eased and street violence has subsided considerably since the vote. Sunday’s elections were held with minimal disruptions.

Even before the vote, Hong Kong’s stock market had begun to climb again, even though the territory’s economy has fallen into a recession for the first time in a decade. On Tuesday, Alibaba, the Chinese e-commerce giant, raised billions of dollars through a share sale in Hong Kong, suggesting that the city remains a crucial financial centre for Chinese companies.

That could give Beijing room to see what its opponents do next. In particular, the winners of Sunday’s vote will now have to show that they can meet the needs of their constituents. The more than 250 pro-democracy candidates who won local office for the first time last Sunday will have to deal with countless tiny community management issues, from the location of bus stops to complaints over air conditioners that drip too much. Most of the city’s new district councillors, many of them in their 20s, campaigned on democracy issues instead of less glamorous community service.

“I just hope the radicals in the democratic camp haven’t bitten off more than they can chew,” said Leung Chun-ying, a former chief executive of Hong Kong who is now a top adviser to Beijing’s leadership.

Hong Kong’s core issues are unlikely to be solved anytime soon. They could extend past the US elections next year, when Chinese negotiators may face a new US president.

While Beijing may wait for now, the challenges presented by the US legislation are not likely to be forgotten. Trump’s signing of the bill could intensify fears within the Communist Party that its influence is waning in the territory and provoke additional efforts to tighten control.

Xi’s government said last month that it would roll out new steps to “safeguard national security” in Hong Kong, though it has not offered specifics.

The more the United States tries to “play the Hong Kong card,” said Tian Feilong, executive director of a research institute on Hong Kong policy in Beijing, “the deeper China’s anxiety over Hong Kong’s national security gets.”

“The central government will even more urgently consider its methods and systems to control Hong Kong,” Tian said.

©2019 The New York Times Company