China is building its biggest Free Trade Port in Hainan. Expected to be ready by 2035, the port will put Hainan on the frontline of the country’s integration into the global economic system. Financial opening, zero tariffs, and preferential policies for foreign investment are planned for the coming years.
The master plan announced by Xi Jinping counts with Hainan being fully operational as a Free Trade Zone by the end of 2020, Free-trade Port basic and essential setups to be all up and running by 2025, followed by advanced developments to compose the port system and turn it into a complete operational hub by 2035.
On top of the Hainan free-trade port infrastructure, other economical ecosystems are also escalating to the next stage. Hainan’s tourism industry is getting major incentives to boost its operations, citizens of 59 countries to entry Hainan for thirty days without applying for a visa if they book their travels through one of the qualified travel agencies.
To expand the medical tourism, Hainan’s government has established the Boao Lecheng International Medical Tourism Pilot Zone, which is the first special zone for medical travel in China. The goal is to develop a complete healthcare tourism service infrastructure to generate new streams of revenue and growth for Hainan.
Even international yachting is included. New policies have been implemented to allow foreign yachts stay for 183 days each year. In addition, several new ports will be built around the island to support and grow the yachting business.
Basically, Xi is hopping to attract a wide range of domestic and international companies by granting low or to no tariffs on goods and services in Hainan.
The Central Committee of the Communist Party of China and the State Council believes that a free trade port is the world’s most open form of economic zone. Clearly, it has brought prosperity and major development to places like Shanghai, Guangzhou, Hong Kong, Singapore, and many other locations worldwide thanks to its broad-based preferential policies on trade and investment.
The fact that Hainan is now a special functional economic area with the highest level of openness in the world, it has attracted and already signed hundreds of contracts with big companies. For example, the China National Travel Service Group Corporation (China’s biggest travel business company) moved its headquarters from Beijing to Hainan. Baidu will build an eco-village.
More and more international companies also signed investment deals with Hainan such as Ikea, Viacom, Avis Budget, Star Cruises, and Boehringer Ingelheim. To bring in the skilled workers that are needed for Hainan’s grand plan, the government of Hainan held a job fair in Beijing at the end of last year which resulted in significant increases to the local number of residents.
With the rising flow of people, goods and capital due to the tax-free policies brought by the free trade zone and port, Hainan is expected to be a pivotal point linking the Chinese mainland with southeast Asian countries, said Lin Jian, chairman of Hainan Ganghang Holding Limited Company, a local shipping and logistics enterprise.
‘I believe Hainan will be a highly international and modernized island in another 30 years,’ said Chi, who served as head of the provincial policy research office in his early years in Hainan, who later became a scholar.”