US to ‘reap what it sows’ with ban on China tech investment: Hong Kong’s John Lee

City leader warns rules targeting investment in semiconductors, quantum technologies, AI to hurt both free markets and US’s own interests

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Hong Kong has been caught in the crossfire between Beijing and Washington amid escalating geopolitical tensions in recent years. Photo: Reuters

Published: 2:39pm, 29 Oct 2024Updated: 4:53pm, 29 Oct 2024

Hong Kong’s leader has warned that the United States will ultimately “reap what it sows” with its plan to clamp down on outbound investment in China’s semiconductor, quantum technology and artificial intelligence industries.

Chief Executive John Lee Ka-chiu also said on Tuesday that the move by Washington was not only harmful to others but also its own residents and businesses, citing the US$271.5 billion the country had earned through trade with Hong Kong over the past decade.

“American politicians, in pursuit of political goals, are harming not only others but also their own country, citizens and businesses, and they will ultimately face the consequences,” Lee said before a meeting with the Executive Council, the city’s key decision-making body.

The US Treasury Department announced a day earlier that new rules would be introduced that prohibited engagement in certain transactions with mainland China, Hong Kong and Macau involving “a defined set of technologies and products” that posed national security risks.

The department also said it would require businesses and individuals to notify it if they had engaged in such transactions. The new rules will come into effect on January 2.

Lee said the restrictions once again showed how US politicians undermined normal investment trade, free markets and economic order in pursuit of their own interests.

The new US regulations would also harm global supply chains, while affecting the country’s own interests and those of its businesses, he added.