CX HK

Cathay and Swire will also do some behind the scenes negotiating and lobbying. Navigating the conflicting interests of Hong Kong, the US, and China is an impossible task. Swire is one of the most well-oiled business machines out there and if anyone can navigate these sensitive times, it is them. They will do everything they can to protect their flagship business using whatever (legal) means necessary.

garykung

Of course not. In fact - your narrow focus is what makes the so-called fact you believe in.

The purpose of Hong Kong Autonomy Act is to penalize those who affect the Autonomy of Hong Kong, i.e. Chinese official and/or entities. In multiple occasions, the Act states how the Chinese Government influence Hong Kong. Your bold portion exactly represents how the HKSAR Government has acted by obedience.

So far, the only actual sanction the U.S. Government has ever done is not to sell any non-lethal weaponry to the Hong Kong Police. Other than that, the U.S. Government has not taken a single action against HKSAR Government, as well as people and/or entities in Hong Kong.

To further illustrate this in aviation, when Elaine Chao bans Chinese flights to the U.S. as retaliatory against the China's 5-1 policy, CX (including UO) is not subject to the ban because the 5-1 policy never affects flights from/to Hong Kong. And Hong Kong never attempts to ban flights. Even with the new testing quarantine requirement, which resulted another service suspension by AA/UA, CX flights are still operating to the U.S.

FWIW - the U.S. is not trying to destroy Hong Kong, but instead to put enough pressure to China so that China will back down.

Basically, unless the HKSAR Government has done something dramatically to affects U.S. flights, CX is safe. In fact, CX can be benefited from it (given the sanction, ban, etc. impacts Mainland airlines).

889

"Swire is one of the most well-oiled business machines out there . . ."

Cathay Pacific shareholders might question that conclusion. Or at least ask, where has all that oil gone?

Share price 1/1/00: $12.30
Share price 1/1/20: $ 9.84
Share price 24/7/20: $ 5.56

CXYYZ

The HK Autonomy Act is not a threat to CX and I did not state that it was. I was responding to your assertion that the HK government hasn't done anything to annoy the US, which it demonstrably has. See also the US response to arrests of pro-democracy politicians in April. Regardless, this is all background noise and doesn't dictate whether CX will be forced to cut/amend US service.

As I said, the question is whether any of the laws and executive orders (and resulting changes) coming from the US impact the bilateral air services agreement between the US and Hong Kong. If you can directly address this, I would be interested in understanding the answer.

889

The President's Executive Order states, "It shall be the policy of the United States to suspend or eliminate different and preferential treatment for Hong Kong to the extent permitted by law and in the national security, foreign policy, and economic interest of the United States." The Order then goes on to list a number of statutes and rules to be affected. None of them includes air transport.

However, there is a catch-all under which agency heads shall propose for the President's consideration "any further actions deemed necessary and prudent to end special conditions and preferential treatment for Hong Kong."

Note it's not an absolute eliminate-all-special-treatment rule. The U.S.'s interests are also weighed.

So nothing now, but the issue is not closed.

CXYYZ

Thanks, that's really helpful.

YYCCL3

Into the morass of political instability...

garykung

As I have said before, any laws and/or orders aim Mainland, not Hong Kong. Even the U.S. claims it will normalize its treatment of Hong Kong, nothing has actually done. For example - EVUS. EVUS is a system, similar to ESTA, that a Chinese (Mainland) national must enroll even having a valid B1/B2 visa. Yet, despite the claimed normlization, EVUS is still not yet applied to HKSAR Passport holders yet, per CBP website.

So to impact the US impact the bilateral air services agreement between the US and Hong Kong, either the U.S. or HKSAR Government has to piss each other more than enough, such as a policy similar to 5-1. Then it may.

Otherwise, there is nothing. Really. CX still remains the only passenger airline currently serving between the U.S. and Hong Kong.

SKRan

Exactly. The word 'preferential treatment' of HK in US President's order is rather hollow. Everything US currently made available to HK is standard treatment and there is no legal definition of how a 'preferential' one would be like.

CX will see major benefit when the supply of direct air transport between the Mainland and US drops. No more ex-PEK I US$2000 fares!

garykung

Actually, there is - United States-Hong Kong Policy Act.

But keep in mind - even the status of Hong Kong has been normalized, it does not prevent the U.S. from giving preferential treatment to Hong Kong over the Mainland still. For example, the U.S. bans exports of weaponry to China. But Hong Kong may still able to get the weaponry with a export permit.

brunos

US started banning exports of defense and dual-technology equipment to Hong Kong on 30 June.
Dual-technology means technology that could possibly be used for military purposes. That is quite far reaching in terms of technology.
https://www.state.gov/u-s-government-ending-controlled-defense-exports-to-hong-kong/#:~:text=U.S.%20Government%20Ending%20Controlled%2 0Defense%20Exports%20to%20Hong%20Kong,-Press%20Statement&text=The%20Chinese%20Communist%2 0Party's%20decision,its%20policies%20toward%20the% 20territory.&text=The%20United%20States%20is%20for ced,to%20protect%20U.S.%20national%20security.

garykung

The ban has not stated yet, contrary to what has been claimed. While the State Department works with other federal agencies in trade, the actual federal agencies responsible in trading are USTR, Commerce and even CBP. In fact, the Commerce Department has not yet updated its website reflecting the "ban" or changes in requirement. The Hong Kong FAQs has not been updated yet. But Huawei's ban is fully in effect, currently under extension.

When the President's Executive Order did normalize Hong Kong with Mainland China, nothing practically has been changed. Again, the same normalization should make HKSAR Passport holders to fall under EVUS. Also - Hong Kong no longer considers its own place for immigration purpose (so Hong Kong will use China's quota). But none of them has happened.

In short - the ban is still a theory not yet recognized.