China has launched island-wide special customs operations in the Hainan Free Trade Port, allowing freer entry of overseas goods, expanded zero-tariff coverage, and more business-friendly measures. This move is widely seen as a landmark step in China's efforts to promote free trade and high-standard opening-up amid rising global protectionism. The first batch of zero-tariff petrochemical materials has cleared customs, signaling the start of a new phase.
The Hainan Free Trade Port (FTP), spanning over 30,000 square kilometers, is the world's largest by area. On Thursday, China officially launched island-wide special customs operations, designating the tropical island as a special customs supervision zone. This enables freer flows of goods, capital, personnel, and data, backed by zero tariffs, low tax rates, and a simplified tax system.
The initiative stems from President Xi Jinping's 2018 announcement supporting Hainan's construction of a free trade port with Chinese characteristics. A master plan released in June 2020 aims to build it into a globally influential high-level FTP by mid-century. Xi described it as a major move by the Communist Party of China Central Committee to further opening-up and promote economic globalization.
During visits in December last year and November this year, Xi reviewed local reports and noted that the operations will raise the share of zero-tariff goods from 21 percent to 74 percent, while further opening sectors like tourism, modern services, and high-tech industries. He stated, "The launch of island-wide special customs operations will provide Hainan with the foundational conditions to advance opening-up across a broader scope and at a deeper level," urging bolder reforms.
The first batch of zero-tariff petrochemical raw and auxiliary materials arrived at Yangpu Economic Development Zone on Thursday, totaling 179,000 metric tons valued at nearly 400 million yuan (about $56.79 million), saving enterprises around 10 million yuan in costs.
Ruslan Tulenov, a Kazakh and the first foreign employee at the Hainan International Economic Development Bureau since 2019, said, "Every time President Xi comes, we feel encouraged." He promotes Hainan globally, likening it to the next chapter after Shenzhen's opening. Matteo Giovannini, an Asia-Global Fellow at the University of Hong Kong, views Hainan as a test ground for high-level opening-up, offering models for cross-border flows and data governance. Wang Ying from the University of International Business and Economics noted it reflects China's confidence in globalization and contributes Chinese solutions to international rules.
The launch coincides with the 47th anniversary of the 1978 Third Plenary Session of the 11th CPC Central Committee, marking another key step in China's reform and opening-up.
