US to label Hong Kong's goods as 'Made in China' in blow to city

[WASHINGTON] The US will order imports from Hong Kong to be labeled as 'Made in China' according to a government document, in the latest escalation of trade tensions between the two nations.

The notice, published in the US Federal Register, says that goods produced in Hong Kong and imported into the US must be marked to indicate their origin is China. This will begin after Sept 25, the document said.

The actual impact of the new rules on Hong Kong's trade or economy will likely be limited as there are few direct exports from the city to the US. The vast majority of the city's shipments to the US consist of re-exports, or goods passing through its territory with no substantial modifications.

Of Hong Kong's roughly HK$304 billion (S$53.8 billion) in exports to the US last year, only about 1.2 per cent were domestic exports, according to data from the Census and Statistics Department Hong Kong. Almost 80 per cent was re-exports from China to the US.

The change was made because of President Donald Trump's July executive order ending Hong Kong's special status with the US "due to the determination that Hong Kong is no longer sufficiently autonomous to justify differential treatment in relation to China," the notice said.

The US decision comes after China announced sanctions on 11 Americans in retaliation for similar measures imposed by the US on Friday.

BLOOMBERG