Construction of the Free Trade Port (FTP) in Hainan got a new impetus after companies signed agreements for 104 projects, involving CNY65.72 billion in total investment and covering tourism, modern services and high-tech industries. Of the 104 projects, 22 are foreign-funded. Previously, the FTP had seen the signing of 741 projects with an investment of CNY519.6 billion in multiple areas including intelligent manufacturing, international shipping, education, medical care and aerospace. China proposed setting up a free trade zone in Hainan in 2018 and began construction of the Hainan FTP last year. Over the past three years, a number of foreign companies have settled in Hainan, including Harrow School from Britain, U.S. electric automaker Tesla and tourism company TUI Group. Cambodia Angkor Air signed an agreement to operate 10 planes in Haikou and establish a base there. David Zhan, Board Director of the company, said they hoped to benefit from “Seventh Freedom of the Air” rights and fly from Haikou to major cities in Northeast Asia, Russia and ASEAN. The Hainan FTP last year began to trial Seventh Freedom of the Air rights, which allows foreign carriers to operate flights between two foreign countries without the need to touch down in the airline’s home country.

Despite the negative impact of the Covid-19 pandemic, the Hainan FTP has forged ahead with a steady inflow of investment. Last year, Hainan launched 538 projects involving investment of CNY172.5 billion. The province also unveiled 11 key industrial parks in June last year, where favorable FTP policies have been implemented to attract investment projects. Over 20,000 new enterprises were registered in these industrial parks last year. In 2020, 1,005 overseas-funded enterprises set up operations in Hainan, up 197.3% from the previous year. The booming duty-free shopping sector is another attraction for global brands wishing to explore China’s huge market. After 2025, the entire island could become duty-free. The first China International Consumer Products Expo, scheduled for Haikou in May, has attracted more than 1,100 international brands, including L’Oreal, Shiseido and Tesla. “With the expo, Hainan will become the largest luxury consumption center in China and even the  world,” said Chi Fulin, President of the Hainan-based China Institute for Reform and Development. Starting on July 1, 2020, Hainan increased its annual tax-free shopping quota from CNY30,000 to CNY100,000 per person. The categories of duty-free goods have been expanded from 38 to 45, with electronic products such as mobile phones and laptops added to the duty-free list. There are now nine duty-free shops in Hainan, the China Daily reports.