Critics say the new law would end Hong Kong’s status as an international business hub, especially for hundreds of US multinational firms.

China on Tuesday warned the US against imposing sanctions on it over the new Hong Kong security law, saying Beijing was ready with its own necessary countermeasures.

Chinese President Xi Jinping on Tuesday signed a controversial security law that gave Beijing new powers over Hong Kong that are tailor-made to crackdown against dissent, criminalising sedition and effectively curtailing protests, amidst global anger and outrage in the former British colony.

Xi signed the legislation soon after Chinese lawmakers voted unanimously to adopt the Law of the People’s Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region (HKSAR).

The law — facilitating the presence of Chinese security offices in Hong Kong, besides prohibiting acts of secession, subversion, terrorism and collusion with foreign forces to endanger national security — was passed by the 162-member Standing Committee of China’s legislature the National People’s Congress (NPC).

In a statement, US Secretary of State Mike Pompeo said in view of Beijing moving ahead with the national security law, Washington will stop exporting US-origin defence equipment and will take steps towards imposing the same restrictions on US defense and dual-use technologies to Hong Kong as it does for China’s mainland.

US Secretary of Commerce Wilbur Ross had announced that the US would suspend preferential treatment to Hong Kong, including the availability of export license exceptions.

In a sharp reaction, Chinese Foreign Ministry spokesman Zhao Lijian said Hong Kong’s national security legislation is China’s internal affair and no foreign country has any right to interfere.

“The Chinese government is determined to safeguard national sovereignty, security and development interests, in implementing the “one country, two systems” policy, and in opposing external forces interference in the affairs of Hong Kong affairs,” he said.

“Intimidation does not work on China. The US wants to wield the so-called ‘sanctions’ to obstruct China’s legislation process to safeguard national security in Hong Kong. Such attempts will never succeed”, he said.

Zhao warned “China will take necessary retaliatory measures to resolutely safeguard its national interests.”

Critics say the new law would end Hong Kong’s status as an international business hub, especially for hundreds of US multinational firms.

According to the Chinese Foreign Ministry, the US has 85,000 nationals in Hong Kong and has over 1,300 companies in the city.

American firms have over 300 regional headquarters and 400 regional offices in Hong Kong. In the decade gone by, the US trade surplus in Hong Kong reached USD 297 billion.