The Chinese government has officially transformed Hainan Island into\na special customs zone valued at US$113 billion (approximately Rp1.76\ntrillion), as its largest free trade experiment ever conducted. The\nambitious project named the Hainan Free Trade Port was launched on 18\nDecember 2024, separating its customs system from the mainland\nterritory.<\/p>\n
Through tariff reductions and the easing of various regulations, this\nstep aims to attract foreign investment while positioning Hainan as an\nalternative new business centre in the region, rivaling Hong Kong\u2019s role\namid global economic uncertainties.<\/p>\n
The policy significantly increases the number of goods eligible for\ntariff-free entry, from around 21% to 74%. Not only that, the category\nof duty-free goods has been expanded more than threefold, now covering\nmore than 6,600 types of products.<\/p>\n
Under the new policy framework, goods processed in Hainan can enter\nmainland China without tariffs if the local value added exceeds 30%. The\nplan also opens access for foreign entities to certain services\npreviously restricted on the mainland, as well as simplifying\ncross-border investment procedures.<\/p>\n
This project is expected to accelerate supply chain integration and\nstrengthen China\u2019s economic relations with countries in Southeast Asia,\nwhich lie directly south of the island.<\/p>\n
The launch of the Hainan FTP was immediately welcomed positively by\nthe market, with shares in China and Hong Kong recording gains on Monday\namid signs of new capital inflows. Analysts view Hainan as a \u201clow-risk\ntesting ground\u201d for China\u2019s transition towards high-level economic\nopenness.<\/p>\n
\u201cThe Hainan model essentially offers managed liberalisation that will\nbe very good for reintegrating supply chains, but this model lacks the\nlegal system and financial openness that Hong Kong can boast,\u201d said Xu\nTianchen, senior economist at the Economist Intelligence Unit, to\nReuters late last year.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/china-suddenly-builds-new-hong-kong-near-indonesia-worth-rp1-76-quadrillion-1777824503", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }