China has indicated that the United States may reinstate Hong Kong's preferential trade privileges, following confirmation from Washington that it will not renew an executive order that previously revoked the city's special trading status. The U.S. Commerce Ministry stated that commitments made by the U.S. on Hong Kong and other issues during trade talks in Madrid last year have been acknowledged. The ministry expressed China's appreciation for this development.
The specific implications of this decision remain unclear. A White House spokesperson referred inquiries regarding the executive order's expiration to the Treasury Department. The U.S. Office of Foreign Assets Control confirmed that the national emergency declared by the executive order had expired and that individuals sanctioned under it had been delisted. However, it noted that individuals still sanctioned under a separate act related to Hong Kong have been moved to a different sanctions list. Hong Kong's leader, John Lee, and his predecessor, Carrie Lam, were removed from the initial list but added to the secondary one.
This U.S. move comes ahead of an expected visit by Chinese President Xi Jinping to the United States later this year and could help improve U.S.-China relations. The decision follows President Donald Trump's meeting with Xi in Beijing two months prior, during which discussions reportedly touched upon the case of a pastor detained in China, who was later released.
Trump signed the executive order that has now expired in July 2020, during his first term, in response to Beijing's imposition of a national security law on Hong Kong that same year. The order, which was last renewed for one year in July 2025, had stated that Hong Kong was no longer sufficiently autonomous to warrant different treatment from mainland China under certain laws. Consequently, the order removed Hong Kong's preferential treatment to the extent permitted by law and in consideration of U.S. national security, foreign policy, and economic interests.
China views the national security law as essential for restoring stability to Hong Kong, which experienced significant anti-government protests in 2019. These protests presented one of the most substantial challenges to Beijing's Communist Party and the Hong Kong government since the city's return to Chinese rule from British administration in 1997. Critics argue that the civil liberties promised to Hong Kong for 50 years after the handover have diminished, with many prominent pro-democracy figures, including former media tycoon Jimmy Lai, having been imprisoned under the security law.
The Hong Kong government acknowledged the "positive shift in the U.S. policy" towards the city, stating that safeguarding Hong Kong's prosperity and stability aligns with the common interests of China and the U.S., as well as international expectations. The government expressed hope that the U.S. will respect China's sovereignty and Hong Kong's rule of law and resume normal economic and trade exchanges.