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Hong Kong Chief Executive Carrie Lam speaks during a press conference in Hong Kong on December 3, 2019. Lam was speaking after a mass demonstration over the weekend in the Asian financial hubANTHONY WALLACE/AFP/Getty Images

Hong Kong leader Carrie Lam said on Tuesday U.S. legislation supporting protesters may damage business confidence in the financial hub, as she announced a fourth round of relief measures to boost the city’s battered economy.

Lam told reporters the Hong Kong Human Rights and Democracy Act signed into U.S. law last week was “wholly unnecessary,” as the former British colony grapples with its first recession in a decade.

The act requires the U.S. State Department to certify at least annually that Hong Kong retains enough autonomy to justify favourable U.S. trading terms, and threatens sanctions for human rights violations.

“The impact currently is on confidence ... because corporates will be worried about the actions the U.S. government may take in the future after they review this legislation,” Lam said.

Lam did not specify what additional measures would be taken to boost economic activity, saying details would be announced in the near-term. The government has previously offered relief of about HK$21 billion ($2.7 billion) to support the economy, particularly the transport, tourism and retail sectors.

The unrest has hammered retail sales which fell by their steepest on record in October as protests scared off tourists and hit spending.

In more bad news for the economy, China on Monday banned U.S. military ships and aircraft from visiting Hong Kong – a rest and recreation stop for the U.S. Seventh Fleet – in retaliation for the U.S. legislation.

Lam said approvals for such port visits were a matter for China’s Foreign Ministry.

Hong Kong has been rocked by six months of sometimes violent unrest in the biggest challenge to Chinese stability since the bloody crackdown on pro-democracy protesters in and around Beijing’s Tiananmen Square in 1989.

The protesters’ demands include universal suffrage, an investigation into alleged police brutality and an end to Beijing’s perceived efforts to undermine democratic freedoms promised when the former British colony was handed back to China in 1997.

China denies interfering in Hong Kong’s affairs and says it is committed to the “one country, two systems” formula enshrined at the handover and guaranteeing the territory a high degree of autonomy. Beijing blames foreign countries including the United States for inciting unrest.

Activists have pledged to hold lunchtime rallies throughout the week after a mass demonstration over the weekend when police fired tear gas to disperse crowds of protesters.

Hundreds of office workers gathered in Hong Kong’s business district on Monday in support of the pro-democracy movement after it scored a resounding victory in district polls last month.

Lam has renewed her appeals for peace but her administration has failed to offer any concessions to the protest movement despite the election results.

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