#China #Xi Jinping #Hainan #Hainan Free Trade #Yangpu Port

Hainan Free Trade Port: A New Era for China's Economy

On December 18, 2025, the eagerly awaited special customs operations of the Hainan Free Trade Port (FTP) will officially commence. This significant step is considered a cornerstone in China's broad initiative for enhanced openness, as highlighted by recent discussions surrounding its implications for trade, finance, and overall economic growth.

Significant Milestones Ahead

As part of the lead-up to this historic launch, Hainan International Ship Registration Administration has completed the registration for the Xiang Tai Kou, a semi-submersible vessel, marking a crucial milestone for China’s maritime logistics. This vessel, chartered from Liberia, can now operate within the Yangpu Port fleet under Hainan's zero-tariff regime, effectively saving over 10 million yuan (around $1.4 million) in fees including import tariffs and value-added tax on charter rents.

This case exemplifies the advantages that will emerge from the upcoming customs operations, expected to streamline business operations and accelerate high-standard openings for various enterprises within the port.

National Enthusiasm and International Impact

In a recent address, President Xi Jinping applauded these special customs operations as a critical move towards broadening international economic collaboration. He encouraged enhancements in cross-border capital flows and the creation of a welcoming business environment that is market-oriented and compliant with international norms.

Following the launch, Hainan will implement an innovative supervisory model characterized by two different lines of customs regulation. The 'first line' will facilitate freer access for goods from overseas, while the 'second line' will impose standard customs controls for transitioning goods into mainland China.

According to Wang Changlin, deputy head of the National Development and Reform Commission, the portion of tariff lines benefiting from zero-tariff products will surge from 21% to an exciting 74% within the Free Trade Port zone. Moreover, imported goods that have undergone at least 30% processing within the province will be able to enter the mainland tariff-free. This new framework will not only boost trade but also liberalize access to certain restricted products in the market.

Hainan's Growth Trajectory

Hainan has been increasingly attracting foreign investments, accumulating a total of 102.5 billion yuan over the past five years, with an impressive average annual growth rate of 14.6%. This momentum is poised to accelerate following the initiation of the special customs operations, as businesses will be able to capitalize on Hainan's unique economic landscape.

Eight ports are designated to facilitate first-tier entry points for expedited clearance of qualified imports, while an additional ten second-tier ports will manage imports directed towards the mainland. The province already has a visa-free regime in place for travelers from 85 countries and aims to enhance its appeal by expanding this list and relaxing stay policies.

Furthermore, Hainan is laying groundwork for innovative cross-border service trade practices by establishing a negative list that permits foreign investors to access key sectors such as finance, healthcare, and education on equal terms as local businesses.

Yangpu Port is being significantly upgraded to support these efforts. Du Chengcai, deputy general manager of Hainan Port and Shipping International Port Group, noted that new 200,000-tonne berths are being constructed and current shipping routes expanded to enhance cargo flow efficiency, thereby bolstering Hainan's connection to global markets.

Looking Ahead

Economist Li Daokui from Tsinghua University has indicated that China's Hainan FTP is on the brink of a vital opening of its markets. As it transitions into a special customs region, Hainan is expected to become a pivotal site for testing broader economic reforms aimed at inviting foreign companies and technologies.

With the imminent launch of the special customs operations, Hainan strives to position itself as a gateway for global commerce and a model for other regions in China looking to enhance economic integration. For updates on this transformative initiative, visit CGTN.