Photo/Illutration People visit the annual book fair in Hong Kong on July 14. (AP Photo)

WASHINGTON--The Biden administration is expected to issue a blanket warning to U.S. firms about the risks of doing business in Hong Kong as China continues to clamp down on political and economic freedoms in the territory.

U.S. officials say the advisory could be issued as soon as this week. President Joe Biden told reporters Thursday that the alert would point out deteriorating free market conditions in Hong Kong, which was once one of Asia’s main financial hubs, and the potential for further erosion.

“The situation in Hong Kong is deteriorating, and the Chinese government is not keeping its commitment that it made, how it would deal with Hong Kong,” Biden said. “And so it is more of an advisory as to what may happen on Hong Kong, it’s as simple as that, and as complicated as that.”

The United States under both the Trump and Biden administrations has determined that since the passage of a new national security law last year, Hong Kong no longer enjoys the significant autonomy from mainland China that Beijing had pledged to respect for 50 years when it assumed control of the former British colony in 1997.

As such, Hong Kong no longer enjoys preferential U.S. trade and commercial privileges and certain officials in Hong Kong have been hit with U.S. sanctions for their actions in cracking down on democracy.

“We know that a healthy business community relies on the rule of law, which the national security law that applies to Hong Kong continues to undermine,” State Department spokesman Ned Price said Tuesday.

“As a general matter, we seek to ensure that businesses can operate in stable, predictable and fair regulatory environments around the world, and rule of law risks that were formerly limited to mainland China are now increasingly a concern in Hong Kong. That’s of great concern to us. It is of great concern to the American business community. It’s of great concern to the international business community,” he said.

The new warning would come on the heels of a similar advisory issued earlier this week reminding American companies about potential sanctions liability if they engage in business with Chinese entities that operate in the western Xinjiang region, where China is accused of widespread repression of Uighur Muslims and other minorities.

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