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Hainan after transitioning to a special customs operations regime: the island in a new format of openness

Hainan after transitioning to a special customs operations regime: the island in a new format of openness

Published on: 2026-04-03

Source: People’s Republic of China in Russian – People’s Republic of China in Russian –

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Source: People’s Republic of China – State Council News in Russian

Haikou/Moscow, April 3 /Xinhua/ — More than 100 days have passed since the launch of the independent customs operations regime throughout the territory of the Hainan Free Trade Port (FTP) in southern China on December 18, 2025. In just over 100 days, the volume of foreign trade in this youngest and largest FTP in the world increased by 32.9% in annual terms, and the number of people entering the island province under the visa-free regime grew by more than 54%. Meanwhile, political dividends are rapidly transforming into real development results.

POST OF THE EXTRAORDINARY COMMISSION AND PROHIBITION

After the transition to the regime of independent customs operations in full, a system was introduced: “open first line, controlled second line, free trade across the entire island.”

As stated by the deputy head of the department for the development of free trade zones and special customs administration zones of Haikou, Liao Yitin, the first line is the connection of Hainan with foreign markets, where measures to simplify and liberalize the movement of goods and people are being introduced. The second line is the direction between the island and the continental part of China, where strict control of commodity flows is maintained. Within the island, relatively free movement of production factors is ensured.

“An independent customs operations regime ensures a higher level of transparency,” she emphasized.

More than a hundred days after the introduction of the new regime, everyday life in Hainan and the mainland part of China remains stable, without negative changes. No additional restrictions have been imposed on foreign tourists either. Moreover, inbound tourism continues to actively develop.

An important role was played by the expansion of the visa-free policy and the development of air communication. Currently, the number of countries whose citizens can enter Hainan without a visa has reached 86. The route network covers Northeast and Southeast Asia, Europe, Oceania, and other key regions.

“It has now become much more convenient for tourists to arrive in Hainan using the opportunity of visa-free transit through other cities in China,” noted the deputy director of the International Rehabilitation Center at the Hospital of Traditional Chinese Medicine in the city of Sanya, Chen Peng.

The updated duty-free trade policy has become another factor in the growth of interest.

“This shopping center is simply magnificent! There are many products here that I have wanted to buy for a long time, and the prices are lower,” said a tourist from Russia, Alisa, who visited the International Duty-Free Shopping Center in the city of Sanya.

Since November 1, 2025, the list of duty-free goods has been additionally expanded, and the circle of persons entitled to benefits has increased, which has directly stimulated the growth of purchases among foreign guests.

“It’s cheaper to combine shopping and leisure in Hainan. This is another additional advantage in favor of Hainan as a destination,” said Anton Lavruin, director of the management company “Sletat.ru.”

At the same time, the island improves the quality of tourist products and services. In addition to traditional beach holidays, medical and wellness tourism, cultural routes, and sporting events are actively developed. The service environment for foreigners is systematically improving — from language support to payment infrastructure.

NEW OPPORTUNITIES FOR STUDENTS

Hainan is increasingly perceived not only as a resort but also as a platform for institutional experiments and international cooperation.

Unlike traditional free trade zones focused on processing and re-export, the main emphasis here is on the development of tourism, modern services, and high-tech industries.

“China has considerable experience in creating special economic zones. Hainan is a concentration of experience. This is an experimental zone not only for China, but also for all of Asia, primarily East and Southeast Asia,” emphasized Alexey Maslov, Director of the Institute of Asian and African Countries at Moscow State University.

One example of institutional innovation has been the reform in the ferry industry. As part of the Hainan Free Trade Port policy, zero tariffs were introduced on the purchase of ferries, leasing was legalized, night sailing zones were expanded, and the allowable number of passengers was increased from 12 to 26 people, provided safety standards are observed.

“Key free trade parks fulfill the task of institutional innovations and pilot projects. In 2025, a breakthrough was achieved in the crew member limit for yachts. This significantly stimulates the development of the yacht industry in the city of Sanya,” noted Cui Yuimin, head of the cruise tourism and yachting department of the Central Business District Management in the city of Sanya.

Hainan, relying on the creation of a free trade port (FTP), is forming a base for the placement of headquarters of Chinese companies focused on overseas markets, as well as foreign companies developing the Chinese market.

Thanks to tax incentives, including exemption from profit tax on income from foreign investments, as well as the mechanism of multifunctional free trade accounts, Chinese enterprises are gradually transitioning from exporting products to investment and branding expansion.

“We are creating an integrated platform for foreign video game companies in overseas markets, relying on data centers in Hainan and special channels for international data transmission,” said Liu Tianyuan, General Director of Hainan Overseas Information Technology Co., Ltd.

The island offers simplified registration procedures and the use of PST tax benefits to attract global investors.

“Investment cooperation between Russia and China does not yet correspond to a high level of political relations, and Hainan should become the platform that fills this gap,” noted A. Maslov. According to him, it is necessary to create joint Russian-Chinese high-tech zones and laboratories in the fields of biopharmaceuticals, aerospace, and space on the island. The main goal is not just development, but joint patenting of technologies for entry into the markets of Russia, China, and third countries.

HIGHER LEVEL OF ASSERTIVENESS IN TERMS OF GLOBAL CHANGES

There are 22 pilot free trade zones in China. The Hainan Free Trade Port is distinguished by the fact that it is here that the highest level of openness is tested — not only the unhindered movement of goods and production factors, but also institutional openness corresponding to high standards of international trade and economic rules.

Against the backdrop of rising protectionism and instability in the global economy, China is betting on expanding cooperation. The introduction of an independent customs operations regime in Hainan has become a clear signal of the intention to continue the policy of openness.

“At the present moment, the world is going through one of the most complex phases of its development. Hainan is precisely one of these islands of stability. China acts as the only party that speaks about real freedom of trade, real circulation of goods,” emphasized A. Maslov.

Within the framework of the model “open first line, controlled second line, free trade throughout the island,” reforms are being carried out in the tax, trade, investment, financial, and migration spheres. These measures aim to create a reproducible and scalable model of deeper foreign economic interaction.

“Hainan Free Trade Port will become an important gateway for a high level of openness of China,” said the official representative of the Ministry of Foreign Affairs of the PRC, Lin Xian, on December 23, 2025. “Despite the growth of global uncertainty, China intends to expand openness, share development opportunities, and promote the formation of a more open world economy,” he emphasized.

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