In more normal times, several USA naval ships visit Hong Kong annually, a rest-and-recreation tradition that dates back to the pre-1997 colonial era and one that Beijing allowed to continue after the handover from British to Chinese rule.
An extradition bill was introduced in Hong Kong in April, triggering the first round of protests.
The legislation targets officials believed to be involved in human rights abuses carried out in response to the pro-democracy protests that have roiled Hong Kong since June.
Hong Kong has seen nearly nonstop protests for six months demanding democratic elections and an investigation into police use of force at the demonstrations.
China's United Nations mission in Geneva said the article interferes in China's internal affairs and exerts pressure on Hong Kong's government and police, which "will only embolden the rioters to conduct more severe radical violence".
China will impose sanctions on US-based pro-democracy and human rights groups in response to a recent USA law supporting protesters in Hong Kong.
The NED, one of the U.S. NGOs to be sanctioned, though defines itself as a private, non-profit organization committed to supporting democratic institutions worldwide, has been proved covert ties with Central Intelligence Agency (CIA), which operates two of its largest overseas branches in Hong Kong, one of which - NDI - is also on the sanction list.
A woman holding a baby shouts at police during the anti-government rally "Lest We Forget" in Kowloon in Hong Kong, China December 1, 2019.
"These organisations deserve to be sanctioned and must pay a price, " Hua said.
The institute has no role in the current protests, and "to suggest otherwise spreads misinformation and fails to recognize the movement stems from genuine grievances", he said.
China denies interfering, says it is committed to the "one country, two systems" formula put in place at that time and has blamed foreign forces for fomenting unrest.
The bill also says the U.S. should allow Hong Kong residents to obtain USA visas if they have been arrested for being part of non-violent protests.
Shops and businesses in the area closed early as police sprayed volleys of tear gas at protesters, including some elderly residents and others with their pets, as they marched past the city's Kowloon waterfront, home to luxury hotels and shopping malls.
Antony Yiu, an entrepreneur in advertising and one of the organizers, said they want other business sectors to join them.
"Our effort is to make sure those weren't empty promises that were made to the people of Hong Kong", Mr Pompeo said, while calling for all sides to avoid violence.
The territory's leader has so far refused to make concessions, despite the pro-democracy camp's victory last month in district council elections.
"China will take further steps if necessary to uphold Hong Kong's stability and prosperity and China's sovereignty".
"The willingness of tourists coming to Hong Kong has been significantly affected, " the city's financial secretary, Paul Chan, said Monday.