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Hong Kong protests

US senators seek precision shot at China to spare Hong Kong

Washington weighs whether getting tough on mainland will only hurt the city

Pro-democracy activists Nathan Law and Joshua Wong speak to the media in response to the national security legislation in Hong Kong on June 3.   © Reuters

NEW YORK -- American lawmakers are rummaging through their sanctions toolbox for a targeted blow that would make China feel pain over Hong Kong while minimizing damage to the city itself and Washington's interests.

The Chinese Communist Party "must know that there are consequences to its actions," said Republican Sen. Pat Toomey, who chaired a hearing Thursday to review U.S. policy options. "Otherwise, the lesson that they will conclude is that they can continue the aggression against Hong Kong and perhaps in other places around the world."

The Senate Banking Committee hearing, held via videoconference, came days after President Donald Trump said Friday that his administration would revoke special treatment for Hong Kong that now ranges from travel to export controls.

"I would support effective calibrated additions to our present sanctions arsenal," said the committee's ranking member, Sen. Sherrod Brown, an Ohio Democrat.

Unilateral U.S. sanctions, however, may be ineffective, Brown warned, with possible "unintended consequences harmful to our strategic interests."

Trump's announcement, along with Secretary of State Mike Pompeo's recent report to Congress that Hong Kong is no longer autonomous, came in response to China's approval last week of legislation that would extend mainland-style national security rules to Hong Kong. The new law sparked fears over an end to freedom of expression in the city.

Despite Trump's strong statement, it remains unclear just how much of Hong Kong's special treatment will be ended and when.

Hong Kong pro-democracy activists including Joshua Wong and Denise Ho, who both testified in the U.S. Congress last year, have called for strong sanctions in response to China's actions in Hong Kong from Washington and its allies.

But the intricate web of interests between the formerly British city, the mainland and the U.S. present Washington with a dilemma as it looks for ways to hurt Beijing and not itself and Hong Kong.

"Too much pressure could further isolate Hong Kong from global markets, hurting Hong Kongers and causing U.S. and other foreign companies to downsize their exposure, or even leave the jurisdiction altogether," warned hearing witness Eric Lorber, senior director at the Center on Economic and Financial Power Foundation for Defense of Democracies.

Excessive pressure also risks "significant fallout in financial markets" and a damaging response from Beijing, Lorber warned.

"However, too little pressure may not move the needle enough," he continued. "A weak response could signal to Beijing that it has the green light to increase its aggression, crack down on the pro-democracy movement, and further erode the freedoms enjoyed by those in Hong Kong."

Brown also called on the White House to use existing U.S. laws allowing Washington to sanction foreign officials in order to take forceful action against China immediately.

"President Trump could use these authorities tomorrow," he said after noting the urgency of the situation. "He should have made it clear months ago he would use them to respond to action against Hong Kong. Congress should press the White House to do its job with a comprehensive and multilateral approach."

Democrats like Brown have criticized Trump's response to the Hong Kong crisis as too late.

"President Trump leads China's leaders to believe they can tighten their grip on their own people and our president, the president of the United States, will continue to look the other way," he said.

Trump had previously said that "I think President Xi of China has acted responsibly" regarding the Hong Kong protesters and that he stands with Hong Kong but also with Xi Jinping.

Meanwhile, experts at the hearing warned that in Hong Kong, some of the damage might have been already done.

"Sanctions will be unlikely to restore many of the freedoms that the CCP [Chinese Communist Party] has taken away from the people of Hong Kong," Lorber said.

"Our primary objective should be deterring the CCP and local authorities from further cracking down on the pro-democracy citizens of Hong Kong," he said. "Second, we should ensure that any action we take does not further push Hong Kong into Beijing's control. And third, we should work to target the economic impact of these actions, so that we do not harm legitimate businesses, including U.S. companies and financial institutions operating in Hong Kong. Achieving these objectives will be challenging."

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