Analysis | Pence speech takes hard stance on Hong Kong

Analysts are highlighting the strong support Mike Pence offered for protesters in Hong Kong during a long-anticipated speech delivered in Washington late last week. That may mean the Senate will move ahead with measures backing the demonstrators, they said, which might in turn spark countermeasures from China.
Earlier, China fired back at Pence’s criticism on human rights, calling his speech “lies” and chiding him for ignoring U.S. problems like racism and wealth disparity.
Separately, China said that preventing U.S. investors from entering Chinese markets isn’t in the interest of the U.S. Those comments came after Senator Marco Rubio criticized MSCI Inc. for helping funnel Americans’ investment dollars into Chinese companies linked to human rights abuses and national security threats.
The speech gave a “green light” for Congress on Hong Kong, Chris Krueger of financial services firm Cowen wrote in a note. “Pence was extremely strong in his defense of the Hong Kong protesters,” he said. That added to Cowen’s conviction that pending legislation will “clear the Senate by the end of the year.”
Pence “went a bit further than other U.S. officials so far in expressing support for the Hong Kong protest movement,” RBC’s Elsa Lignos wrote. She also flagged remarks by Pence that called out Nike and the NBA for acting like a “wholly owned subsidiary” of China.
The speech was “more aggressive than expected on Hong Kong, but struck an overall balance that we expect will preserve progress in trade talks,” write Clayton Allen of Height Capital Markets.
“While the statement that the U.S. ‘stands with’ Hong Kong protesters was strikingly close to language which drew backlash from Chinese leadership, Pence moderated its impact with clear references to Chinese sovereignty and restraint,” he said. Allen sees Chinese push-back as unlikely to include limiting or pulling away from trade talks.
Allen also expects the remarks will “go quite a long way toward satisfying China hawks in Congress looking for a tougher stance toward Chinese authoritarianism.”
Ed Mills of financial services firm Raymond James noted that the vice president offered the “strongest vocal support for the Hong Kong protesters to date,” even as his tone on U.S.-China trade seemed more moderate compared to his remarks last year. MDT/Bloomberg