How important is Hong Kong to China?

https://www.reuters.com/article/us-hongkong-protests-finance-explainer/explainer-how-important-is-hong-kong-to-china-as-a-free-finance-hub-idUSKBN2350VO

Many analysts painted the picture that at least 60% of FDI in China came from HK and without HK, China would lose all these foreign direct investments (FDIs).  However, the truth is the exact opposite from these analyses.  Why?

Many US firms established their regional HQs or HQs in HK because of the US special trading status bestowed upon HK since the US wanted to make use of the special political status (1 country-2 systems) that HK possessed.  The HK tax-free status between the US and HK had given the US firms the advantages to import and export to China through HK without any tax.  Therefore, many US firms avoided direct investments in China by harnessing this special trading status in HK and invest in China indirectly through HK.  This basic understanding helps to explain the high HK's FDI in China. 

This special US-HK trading status also gives US the leverage to embark on a US-China trade war because the US can exclude the HK trading figures from the US-China trade deficit.  In the last decade, the US-HK trade surplus had reached about US$300B which had benefitted the US.

https://www.channelnewsasia.com/news/asia/amcham-sad-day-hong-kong-trump-strips-special-treatment-12786452

http://sg-stock.blogspot.com/2019/05/how-did-us-fudge-us-china-trade-data.html

The time has come for China to close this loophole in the US-China trading relationship.  HK was able to enjoy this preferential treatment because China had always treated HK as a long-lost child.  Recently, China had decided to impose its national securities law (NSL) on HK so that it could get rid of US influences in HK to restore peace and order in HK.  Yes, there will be protests in the next 1-2 years but peace and order will return after China executes the NSL against some defiant Hongkongers as a show of force.  This NSL will be good for HK in the long run.

http://sg-stock.blogspot.com/2019/11/hong-kong-is-financial-hub-because-of.html

The US firms will lose a lot and China will gain more leverage against the US because the US firms will have to invest directly in China instead since there is no added advantage by using HK after the US cancels the special US-HK trading status.  The US has to weigh the pros and cons now with regards to this cancellation.

Many US firms will not choose to give up the China market since there are a lot of monies to be made and their stock prices will drop significantly without China revenues.  Therefore, China will gain more direct FDIs but will diminish its HK's FDIs in the end which will not result in a significant fall in the total China FDI figure.  The only victim in this episode will be HK since HK deserves it with its misjudgement (anti-China stance).