HONG KONG, May 26 (AFP) - Hong Kong on Wednesday defended itself against US claims that it is regularly used by Beijing to ship sensitive US military technology into mainland China. The congressional report published Tuesday said Beijing takes advantage of Hong Kong's less restrictive export controls to ship stolen military technology to the mainland through the use of front companies here. But a Hong Kong government spokesman said the territory, which returned to Chinese rule in 1997, operates an autonomous and stringent system of strategic trade control. "Hong Kong is a separate customs territory which has full autonomy in regulating the import and export of goods, including strategic commodities," the government spokesman said in a written statement. "Our strategic trade control system is backed up by transparent laws, comprehensive licensing requirements and vigorous enforcement. All companies, regardless of their background, are subject to the same set of rules and regulations." The spokesman added Hong Kong maintained close co-operation with its trading partners in combating the illegal diversion of strategic commodities and that it followed the highest standard of control practised by international non-proliferation regimes. "We are determined to continue doing so for our own economic interests," the spokesman said. China Wednesday denounced the report resulting from an 11-month inquiry led by Republican Representative Christopher Cox which alleges Beijing systematically stole US military technology including the secrets to every key US nuclear warhead made since the 1970s to update its own arsenal. Hong Kong-based Sino-US relations analyst Bob Broadfoot said the latest allegations were another indication that worsening relations between China and the United States could have a damaging effect on Hong Kong. "There are factions in the US that are now really taking a harder line on China and Hong Kong is in real danger of being squeezed in the middle here," said Broadfoot, managing director of the Political and Economic Risk Consultancy. "It's going to hurt Hong Kong's ability to trade and conduct an independent foreign economic policy. It's serious," he said. Hong Kong would suffer if the US imposed trade penalties against Hong Kong for allegedly allowing military equipment to be transshipped to China, he added. The Cox Report, released Tuesday, also suggests reviewing whether Washington should subject Hong Kong to the same strict export controls that it imposes on the mainland.  