China Passes National Security Laws for Hong Kong

Business Investing – The National People’s Congress Standing Committee passed new national security laws for Hong Kong on Tuesday as it wrapped up a three-day meeting.

The laws will punish activities involving terrorism, secession, foreign interference and subversion of state power.

The Basic Law Committee will be meeting later in the day to discuss inserting the laws into the Basic Law, Hong Kong’s constitution-like instrument. Full details of the laws, which come into effect on July 1, will also be disclosed later in the day.

The Hong Kong government’s first attempt at enacting national security laws in 2003 resulted in mass protests and the resignation of then Chief Executive Tung Chee Hwa. But after a half year of protests in the city over an extradition bill, which was later withdrawn, in the latter half of 2019, the committee passed a motion to draft and enact the laws for both Hong Kong and Macau in May.

The U.S. stripped Hong Kong of its special trade status soon after the motion was passed, and the Senate passed a bill during the previous week imposing sanctions on Chinese entities involved in enacting the laws.

The Hang Seng Index gave up some of its earlier gains but was up 0.76% by 10 PM ET (3 AM GMT). The Shanghai Composite was up 0.33% and the Shenzhen Component was up 0.68%.

Meanwhile, the CNY/USD pair slid 0.17% to 7.0674.