June 10 marked five years since the Hainan Free Trade Port Law of the People’s Republic of China was promulgated. Since then, the legislation has established a robust legal and institutional framework that has enabled the smooth functioning of the Hainan Free Trade Port (FTP), particularly following the launch of special customs operations in December 2025. Recent data indicate that the key policies of the FTP have produced concrete outcomes, further boosting the island’s openness and economic vibrancy.

A press conference marking five years of implementation of the Hainan Free Trade Port Law of the People’s Republic of China on June 10.

From the launch of the landmark initiative through the end of April this year, imports benefiting from the FTP’s zero-tariff policy reached CNY 2.26 billion, almost doubling the previous year's total and up 99.5%. Goods sold domestically under the import tariff exemption policy for products with no less than 30% added value after processing in Hainan totaled CNY 510 million, with exemptions amounting to CNY 24.573 million.

A series of policy optimizations, such as the cumulative calculation of value added through processing and the inclusion of locally produced goods in value-added totals, have been successfully implemented. On June 1, the first example of value-added in the specialty vehicle sector was completed, broadening the policy’s range of applications.

Meanwhile, 15 transactions have been processed under the exception mechanism for the list of prohibited and restricted items, totaling CNY 3.503 million. Six enterprises have obtained qualifications for bonded maintenance services, and three companies have begun bonded maintenance operations under the “two-ends-abroad” model, whereby items are temporarily imported for maintenance before being re-exported, indicating new advances in trade management reform.

An aerial view of Yangpu Port in Hainan Province.

Since the launch of special customs operations, Hainan’s “first-line” (internationally facing) and “second-line” (mainland-facing) ports have operated efficiently and smoothly. The province has embraced a “smart regulation + credit-based supervision” approach and introduced facilitation measures, including expedited release at the first line, batch release upon leaving the island at the second line, and centralized declaration.

These measures have decreased the average customs clearance time for imported goods by 20% and reduced declaration requirements for goods entering the Chinese mainland through the second line by over 60%, further facilitating the cross-border movement of people and goods.

As customs procedures become more efficient, the movement of people and goods has accelerated. From the launch of special customs operations to the end of April, Hainan saw 1.167 million inbound and outbound passenger trips, a 33.2% increase compared to the previous year. Of these, 300,000 visitors entered visa-free, marking a 46.9% rise.

During the same period, the province managed 8,281 inbound and outbound aircraft movements, an increase of 28.9%, and 1,932 vessel movements, up 14.9%. Over 100,000 foreign trade entities in the province have been integrated into a credit-based customs clearance system, enabling bona fide businesses to enjoy faster procedures. No congestion was observed at any regulatory checkpoints, showing the success of the second-line supervision system.

The implementation of the special customs policies has also strengthened the appeal of the Hainan FTP, with more companies shifting from “wait and see” to “actual investment.” From the start of special customs operations through the end of April, 128,000 new business entities have been established in the province, including 1,016 new foreign-invested enterprises, representing a 35.5% increase compared to the previous year.

The number of foreign trade companies registered with customs has risen by nearly 10,000, now exceeding 100,000 for the first time in history. Offshore duty-free sales hit CNY 18.43 billion, a 23.2% increase compared to the previous year. Additionally, Hainan has introduced duty-free sales for daily consumer goods purchased by local residents, boosting benefits for both locals and visitors. Key projects such as Siemens Energy and Boao RICHL International Hospital have been initiated in Hainan, with more enterprises accelerating their investments and establishing a long-term presence on the island.