Hainan FTP sees sharp increase in global investment

Six months after the launch of island-wide special customs operations, the Hainan Free Trade Port is running smoothly, with international trade and investor interest rising sharply, Feng Fei, Party secretary of Hainan province, told China Daily.

The landmark move, which took effect on Dec 18, 2025, represents one of China's most ambitious institutional opening-up efforts. Feng said that the initial phase had achieved its primary goal of stable and orderly operations, with goods moving efficiently, cross-border travel more convenient, and businesses increasingly moving operations to the island.

As of May 31, the efficiency of customs clearance had improved significantly. The value of imports under the zero-tariff policy jumped 116 percent year-on-year, the average clearance time for imported goods dropped 20 percent, and the declaration requirements for goods leaving the island for the mainland were simplified by more than 60 percent.

The total value of international trade rose 53.7 percent during the period. The number of registered foreign trade companies grew 57.8 percent, while newly established foreign-funded enterprises increased 37.6 percent.

The robust growth reflects not only the initial effects of the special customs operations, but also the growing effectiveness of the Hainan FTP's institutional framework, he said. A comprehensive policy framework is now in place, featuring zero tariffs, low tax rates, and liberalization and facilitation of trade, investment, cross-border capital flows, personnel entry and exit, and transport, alongside safe and orderly data flow. Goods eligible for zero-tariff treatment have expanded from 21 percent to 74 percent of all tariff lines.

Institutional innovations are also reshaping the island's economic structure. Feng said that Hainan has developed a modern industrial system with distinctive characteristics and competitive strengths. Tourism, modern services, high-tech industries and high-efficiency tropical agriculture accounted for nearly 70 percent of the province's GDP in the first quarter of 2026.

Against this backdrop, Feng said that Hainan is becoming an increasingly attractive destination for global investors and highlighted three major opportunities for foreign businesses. Hainan offers China's shortest negative list for foreign investment, a pioneering cross-border services trade negative list, and special market-access measures, including the establishment of wholly foreign-owned hospitals, as well as the independent operation of high-level overseas universities and vocational colleges in the fields of science, engineering, agriculture and medicine.

Located at the junction of two of the world's most dynamic markets — China's 1.4 billion consumers and Southeast Asia's nearly 700 million — Hainan has attracted 22 Fortune Global 500 foreign-funded enterprises and a total of 139 headquarters-type companies. The island has become a popular choice for global investors looking to enter the Chinese market or expand globally. In 2025, Hainan's outbound investment volume grew 20.7 percent year-on-year.

To sustain the momentum, Hainan has been stepping up efforts to develop a market-oriented, law-based and internationalized business environment, according to Feng. The province has introduced a fair competition regulation, enacted 57 local regulations under the Hainan FTP Law, and established international commercial courts and a specialized intellectual property court. A one-stop dispute resolution mechanism integrating mediation, arbitration and litigation is now operational.

Meanwhile, Hainan is upgrading its transport and logistics infrastructure to strengthen its role as a regional hub linking China with global markets.

Hainan aims to become a shipping hub for the New International Land-Sea Trade Corridor and an aviation gateway to the Pacific and Indian Oceans. The first seventh-freedom traffic rights route, which enables foreign airlines to operate routes between two countries without flying to their home countries, is now operational.

Feng outlined a road map to establish Hainan as a new frontier of China's opening-up by 2035, and as a globally influential high-level free trade port by the middle of the century. The province has partnered with 44 global free trade zones and ports, attracted investment from 180 countries and regions, and maintained trade ties with over 220 countries and regions.

chenbowen@chinadaily.com.cn