United States closes China's Houston consulate 'to protect intellectual property'

The Chinese flag flies over its consulate in Houston- which the US has ordered closed in the latest row between Beijing and Washington

The United States said on Wednesday it had given China 72 hours to close the consulate "to protect American intellectual property and Americans' private information".

U.S. President Donald Trump was due to hold a news conference at 5:30 p.m. (2130 GMT), the White House said.

"We thought there was a fire in one that we did close", Trump said. But the order for Beijing to shut its Houston consulate in three days spurred risk-off sentiment overseas and drove investors to assets offering relative safety, such as gold and silver. Witnesses said that people were burning paper in what appeared to be trash cans, the Houston Chronicle reported, citing police.

"The unilateral closure of China's consulate general in Houston within a short period of time is an unprecedented escalation of its recent actions against China", Wang said at a daily news briefing in Beijing. Besides Wuhan, the US has four other consulates in China - in Shanghai, Guangzhou, Chengdu, and Shenyang - along with its embassy in Beijing, according to its website.

These actions have come as Trump has sought to blame China for the coronavirus outbreak in the US, where cases have soared, threatening his prospects for reelection. Foreign ministry spokeswoman Hua Chunying wrote on Twitter that China would "surely react with firm countermeasures".

Communist Party rulers in Beijing were considering shutting the US consulate in the central city of Wuhan in retaliation, a source with knowledge of the matter said.

The development signified a "decouple" and "chicken game" in China-US relations, says Dr. Wang Yiwei, Director of the Institute of International Affairs and Center for European Studies at Renmin University of Beijing. "I would have done both (Houston and San Francisco) but it also makes sense to start with one", he told Reuters by text. Pompeo spoke Wednesday at press conference in Denmark. In an apparent bid to stave off the reciprocal closure of an American diplomatic mission in China, the State Department told the Chinese that it would not reopen its consulate in Wuhan, according to two USA officials who were not authorized to discuss the matter publicly and spoke on condition of anonymity.

"The market is still trying to ascertain whether this increase in geopolitical tension is going to be enough to derail the positive vibes we've been seeing", said Rodrigo Catril, senior FX strategist at National Australia Bank in Sydney.

"We can't continue to sit by and have China rip us off", LaHood told host Sean Spicer. China now has consulates in Chicago, Los Angeles, San Francisco and New York City, but only Houston's has been shut down as of Wednesday.

"We took a practical step to prevent them from doing that", Stilwell told the Times. The State Department did not respond to requests for further explanations.

The official, who was not authorized to discuss the matter publicly and spoke on condition of anonymity, said the closure of the Wuhan consulate might mitigate China's response to the shutdown of the Houston consulate.

HFD explained in a statement that fire crews were denied access to the building, and that the worldwide agreement between the United States and China requires consent from the consulate's staff to enter the property.

The move comes as tensions soar between the world's two biggest economies on a number of fronts, including a controversial national security law in semi-autonomous Hong Kong.

Chinese state media said on Thursday that the move was a political ploy ahead of November presidential elections, and one source with knowledge of the matter told Reuters that China was considering closing the USA consulate in Wuhan in response. The Trump administration has also demonstrably thrown its weight behind India in its border clash following China's incursions, sending an aircraft carrier group for exercises in the Bay of Bengal with an eye on China's depredations. Washington has also cracked down on the Chinese media operating in the United States, asking them to register as diplomatic entities since they are seen as China propagandists, and has threatened to ban Tik-Tok and other Chinese apps.