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China on Friday signalled that the United States could restore Hong Kong’s preferential trade privileges after Washington confirmed it would not renew an executive order that revoked the city’s special trading status.
China’s Ministry of Commerce said the United States had made commitments on Hong Kong and other issues during bilateral trade talks in Madrid last year and had recently informed Beijing that the President’s Executive Order on Hong Kong Normalization would expire.
“The U.S. side’s actions represent an important step in fulfilling the consensus reached during the bilateral economic and trade talks. China appreciates it,” the ministry said in a statement.
The move could mark a modest improvement in US-China relations, although its full practical implications remain unclear.
The White House referred questions about the executive order to the US Treasury Department.
The US Office of Foreign Assets Control (OFAC) said the national emergency declared under the executive order had expired and removed individuals sanctioned under that order from its sanctions list. However, it said those still subject to sanctions under separate Hong Kong legislation had been redesignated under another sanctions programme.
Hong Kong Chief Executive John Lee and former leader Carrie Lam were removed from the expired sanctions list but added to the new one.
The development comes two months after US President Donald Trump met Chinese President Xi Jinping in Beijing and ahead of Xi’s expected visit to the United States later this year. Earlier this month, China also released a detained underground church pastor after Trump raised the case with Xi.
Trump first signed the executive order in July 2020 following Beijing’s introduction of a national security law in Hong Kong. The order declared that Hong Kong no longer enjoyed sufficient autonomy from mainland China to justify preferential treatment under US law and ended the city’s special trade status on national security, foreign policy and economic grounds. The order had been renewed annually, most recently in July 2025.
Beijing has consistently defended the national security law, saying it restored stability after the large-scale anti-government protests in Hong Kong in 2019.
Critics, however, argue the law has significantly curtailed the civil liberties and political freedoms that China pledged to preserve for 50 years after the territory’s 1997 handover from Britain. Several prominent pro-democracy figures, including media entrepreneur Jimmy Lai, have since been imprisoned under the legislation.
The Hong Kong government welcomed what it described as a “positive shift” in US policy.
“Safeguarding Hong Kong’s prosperity and stability serves the common interests of China and the US, and also aligns with the general expectation of the international community,” it said.
The government added that it hopes Washington will respect China’s sovereignty and the rule of law in Hong Kong while restoring normal economic and trade relations with the city.
