Advancing the national goals

With multiple initiatives, Hainan spearheads efforts to establish new development paradigm

HAIKOU — The Chinese economy has entered a stage of high-quality development, and the southern province of Hainan is spearheading the country’s efforts to establish its new development paradigm.

With the first China International Consumer Products Expo in Hainan, the country is giving full play to the advantages brought by Hainan Free Trade Port. The port has demonstrated China’s determination to push ahead with its high-level openingup, and will set an example for highquality development nationwide, Vice-Minister of Commerce Wang Bingnan said during the expo, which ended on May 10.

China first proposed the establishment of a free trade zone in Hainan in 2018. Construction of the Hainan Free Trade Port began in 2020.

The consumer products expo is an essential move toward the construction of the Hainan Free Trade Port and a step toward further openingup as the province strengthens dutyfree consumption to drive economic development.

Official data shows that offshore duty-free sales in the province exceeded 32 billion yuan ($4.98 billion) in 2020 and average daily duty-free sales hit 120 million yuan by the end of 2020, after the annual tax-free shopping quota was lifted from 30,000 yuan to 100,000 yuan per person on July 1.

Offshore duty-free shopping in Hainan has expanded domestic demand and helped push the new development paradigm of “dual circulation”, said Chilli Zhou, country sales director of Zimmerli Textil AG, an exhibitor at the four-day event.

“Dual circulation” allows the domestic and overseas markets to reinforce each other and takes the domestic market as the mainstay.

To prop up high-quality development, Hainan is working to build itself into an international tourism and consumption center, and will introduce modern services such as the Boao Lecheng International Medical Tourism Pilot Zone and over 100 new educational institutions established jointly with domestic and overseas partners, as well as high-tech industries.

Hainan has said it will bolster three emerging industries during the 14th Five-Year Plan period (2021-2025) — the digital economy, new petrochemical engineering materials and biological medicine.

Progress has also been made in green development and innovation. The province plans to optimize and upgrade the entire industrial chain for vehicles powered by clean energy in the free trade port, according to the provincial government.

To expand its high-tech sectors, the province aims to bring its number of high-tech companies to 1,100 in 2021, and to take that number to more than 3,000 by 2025, according to provincial government plans.

The province will also explore green finance products such as a carbon emission exchange and green credit and bonds, said Hainan’s Vice-Governor Shen Danyang.

The Hainan Free Trade Port’s construction has unleashed a slate of favorable policies for market entities.

On April 8, China released a guideline to support the easing of market access in sectors including culture, medical services and education in Hainan Free Trade Port to help build the province into a globally influential, high-level free trade port by the middle of the century.

Direct foreign investment grew from $340 million in 2017 to $3.03 billion in 2020, and the number of new foreign-invested companies expanded to nearly three times the number in 2019, according to the provincial government.

“We are confident in Hainan as the local government has provided us with much support, and we are convinced that the country has great potential for high-quality development as it consistently furthers opening-up,” said Woody Lam, managing director of Savills Southern China.

Since April 2018, 40 centrally administered State-owned enterprises have established strategic cooperative partnerships with Hainan, and the number of new private companies totaled 307,400 in 2020, up 28.3 percent over the previous year.

Shanghai-based Fosun International Ltd has for 25 years been ramping up its layout on the island in sectors including tourism.

“We will introduce more quality global industries into the development of the Hainan FTP using our global supply chain to sustain high-quality development,” Guo Guangchang, chairman and executive director of the company, said at the expo.