Hainan FTP Customs acts to spur investment

The rollout of island-wide special customs operations and expanded duty-free policies at Hainan Free Trade Port will significantly boost its attractiveness among global investors, encouraging foreign companies to increase long-term commitments of capital and talent, said business executives and government officials.

Starting on Thursday, Hainan province has further eased market access in sectors including tourism, modern services and high-end technology. Eligible businesses and professionals in certain industries will enjoy preferential income tax rates that are highly attractive globally.

Amid China's latest push to advance high-standard opening-up, Poh-Yian Koh, president of FedEx China, said the United States-based express transportation service provider will seek growth opportunities at Hainan FTP in the years ahead.

"We are confident that the island-wide special customs operations at Hainan FTP will lead to a higher benchmark of streamlined imports and exports, free and efficient flows of people, goods and capital, and deepened regional and global economic integration. All these factors will further support our growth in China," said Koh.

Operating more than 300 international flights to and from China per week, FedEx is keen to make supply chains smarter for its customers, and strengthen connections between China and other parts of the world in the logistics sector, she said.

"By leveraging our extensive global air and ground networks and smart digital solutions, we look forward to empowering Chinese customers to grow to the next level," Koh added.

The island-wide special customs operations will increase the proportion of zero-tariff products at Hainan FTP from 21 percent to 74 percent starting Dec 18, while the number of tariff-free items in Hainan will rise from about 1,900 to around 6,600, covering nearly all production equipment and raw materials, said the Ministry of Finance.

Combined with streamlined Customs clearance procedures, these measures are expected to solidify Hainan's competitive edge as a low-cost, high-efficiency trade hub and a key gateway for global goods entering China, said Gao Ruifeng, head of Haikou Customs.

Tapestry Inc, a US-based luxury goods company, also plans to add over 60 new stores in China, including in Hainan FTP, over the next three years, expanding its footprint from over 400 stores in 90 cities to more than 100 cities nationwide.

Sandeep Seth, chief growth officer and president of Tapestry International, said that many of these opportunities stem from China's expanded island-departure duty-free policy in Hainan FTP, as well as the "Shopping in China" initiative — part of the country's broader push to deepen market liberalization and spur inbound consumption — alongside young consumers' rising appetite for self-expression.

With Hainan FTP expanding its island-departure duty-free shopping policy on Nov 1 — bringing the offshore duty-free list to 47 product categories ranging from mini drones and portable musical instruments to handbags and tea — Tapestry said its Coach flagship store in Sanya has already seen stronger tourist traffic and broader purchasing demand under the upgraded policy.

"With China's strong consumption fundamentals and policy support, we are fully committed to long-term investment in Hainan FTP," said Seth.

Echoing these market responses, Hua Zhenghong, deputy director of the General Administration of Customs' department of port control, said future policy adjustments would aim to better align with travelers' diverse shopping needs, while supporting domestic consumption and inbound spending.

Also upbeat about the growth potential of Hainan FTP, Stephane Maquaire, president and CEO of Club Med — a Paris-based travel and lifestyle brand and a subsidiary of China's Fosun International Ltd — said the company will further expand its customer base and product innovation in China, integrating more local cultural elements.

"We will further strengthen our position in sun-and-beach offerings with new projects in Sanya, Hainan FTP," said Maquaire, adding that supportive policies at the free trade port and steadily rising tourism demand have strengthened the group's confidence in expanding its presence and innovating its resort offerings in China.

Contact the writers at zhongnan@chinadaily.com.cn