CHINA. The extraordinarily ambitious vision for the Hainan Free Trade Port, including a star role for the duty free retail and international luxury brand sectors, was outlined yesterday during an online European Chamber webinar led by Hainan Provincial Department of Commerce and Hainan Provincial Bureau of International Economic Development (IEDB).
The Moodie Davitt Report participated in the webinar, which outlined the authorities’ determination to open the Hainanese economy to global multi-national enterprises across multiple sectors – including the duty free and luxury industries.
After brief opening remarks from George Lau, Chairman, European Chamber South China Chapter, the webinar’s keynote presenter was Shengjian Han, Director General of Hainan Provincial Bureau of Intentional Economic Development (IEDB), a former Deputy Director General of Foreign Trade Development Bureau of the Ministry of Commerce of the People’s Republic of China.
Introducing the policies of the Hainan Free Trade Port masterplan, Han said: “Hainan is starting its journey of becoming a free trade port. I hope it will open new opportunities for global entrepreneurs from all countries.
“China is going to start a new high level of opening up. That is very, very important. We will align with the high-level global economic rules and build Hainan Free Trade Port into a flagship of China opening up.”
“Hainan will definitely become the global duty free shopping centre. That means in later years, that all Chinese people in the Mainland living in other provinces will not have to fly to other countries… they will just have to fly to Hainan, because here they can buy any duty free products.”
Talking specifically about the duty free sector, he said, “During phase one we are going to relax the offshore duty free shopping policy.” As reported, the annual personal shopping allowance will be raised from RMB30,000 to RMB100,000 RMB30,000 (US$4,215 to US$14,050) . “This means that you can buy very expensive handbags and watches. Also, the categories of duty free goods will be expanded. However, that is just for phase one. After 2025, there will be no limit – so everybody can run the business of a duty free shop, and everyone will be able to buy all kinds of duty free commodities without any quota or category limits.”
According to Tropical Hainan.com, more products for daily consumption, along with additional luxury items will be added to the list of offshore duty free product categories. The number of categories stands at 38 following the addition of medical devices last year.
Summing up the overall plan, Han said: “Before the year of 2035, we are going to realise six things: free trade, free investment, free capital, free visas, free transportation, and free data. By 2050 a high-level Free Trade Port with strong global influence will be built.
“Hainan is going to be an international tourism and consumption centre. Hainan will definitely become the global duty free shopping centre. That means in later years, that all Chinese people in the Mainland living in other provinces will not have to fly to other countries… they will just have to fly to Hainan, because here in Hainan they can buy any duty free products.”
Big luxury brands welcome
Later in the conference, Han added: “Nowadays, world famous brands such as Louis Vuitton and duty free retailers are coming to Hainan to discuss current and future cooperation. For those independent designers and world-famous top-end retailers, all of you are welcome here in Hainan.
“We are encouraging multinationals to set up their regional headquarters here in Hainan. I believe the Hainan Free Trade Port can create many opportunities for multinational companies. Some of the European multinationals, for example, are already in discussions with Hainan.”
