Hainan Free Trade Port to launch independent customs in December
The Hainan Free Trade Port is finally coming into its own.
Over the past week, finance, customs and tax authorities have released a blueprint of Hainan’s new, independent customs operations.
- New customs procedures for the island province will go into effect on December 18.
Once the system is up and running, nearly three quarters of imports into Hainan will be duty-free, up from ~20% currently.
- Duty-free imported goods will be bought and sold freely throughout the province, rather than limited to "self-use" by the importer.
- Manufactured or processed products can then enter the rest of China’s market tariff-free, as long as Hainan adds value of 30% or more.
That’s not all: Hainan’s customs authorities will be able to further streamline processes and relax rules for importing goods that are restricted across the rest of China.
ICYDK: Xi Jinping revealed plans to develop Hainan into a free trade port in 2018.
- The initiative seeks to turn Hainan into a large-scale free trade port featuring tariff-free imports, preferential tax policies, and liberalized capital and data flows – drawing inspiration from international precedents such as Hong Kong and Singapore.
Get smart: After a half-decade of preparation and regulatory fiddling, Hainan could now become a major regional base for processing, re-exporting, and remanufacturing.
- However, for Hainan to truly develop into a global investment and innovation hub will require that authorities allow the free flow of capital in and out of the island.