Rethinking Banking Ties: U.S. Lawmakers Warn of Hong Kong's Role in Trade Violations

Lawmakers have urged U.S. Treasury Secretary Janet Yellen to reconsider financial links with Hong Kong due to its involvement in U.S. trade control violations. Hong Kong has shifted from a trusted financial hub to a critical player in the authoritarian axis of China, Iran, Russia, and North Korea.

In a significant development, U.S. lawmakers have urged Treasury Secretary Janet Yellen to reassess ties with Hong Kong's banking sector following reports of violations. The Wall Street Journal highlighted concerns over Hong Kong's role in exporting restricted Western technologies to Russia and facilitating the purchase of Iranian oil through front companies.

The letter, slated for public release on Monday, emphasizes a shift in perception of Hong Kong from a reliable global financial center to a crucial participant in the authoritarian network of China, Iran, Russia, and North Korea. Lawmakers question if existing U.S. policies concerning Hong Kong's financial sector remain appropriate in this evolving dynamic.

Signed by bipartisan committee leaders, the correspondence cites findings that high-priority items exported from Hong Kong, such as semiconductors, constitute nearly 40% of shipments to Russia, potentially aiding its military efforts in Ukraine. As of now, reactions from the U.S. Treasury and involved committees are awaited.

(With inputs from agencies.)