Consumers visit a duty-free store in Haikou, capital of South China's Hainan province, Oct 4, 2020. £¨Photo/Xinhua£©
Expenditure by bargain hunters more than doubles to $1.27 billion
South China's island province of Hainan is riding a shopping boom after its new duty-free policy took effect on July 1, according to the General Administration of Customs.
Duty-free spending by visitors in Hainan has grown 227 percent year-on-year to 8.61 billion yuan ($1.27 billion) in the period from July 1 to Sep 30, the administration said.
During that time, customer numbers have topped 1.29 million, up 62 percent year-on-year. This, coupled with the personal duty-free allowance increase, has driven the purchase of 9.35 million duty-free items, with a 147 percent year-on-year increase, according to the statistics from Haikou Customs.
The top three commodities in value were cosmetics, watches and jewelry, with total spending of 6.31 billion yuan.
Starting July 1, Hainan increased the tax-free quota from 30,000 yuan to 100,000 yuan per person each year, and tax-free goods categories were expanded from 38 to 45, including electronic products and wine.
Experts believe Hainan has become a leading participant in the development of China's duty-free industry.
They expect a gradual spending recovery despite the mounting downside pressure amid the COVID-19 pandemic.
They said the new allowance increase, together with other preferential policies in the Hainan free trade port will help spur consumption, aid trade and investment in the island province.
China released a master plan in early June on building a high-quality free trade port in Hainan province, as part of the country's ongoing efforts to build an open economy within the framework of globalization.
According to the plan, Hainan will establish a basic free trade port policy system with a key focus on helping free trade and investment by 2025.
By 2035, the free trade port system and operations in Hainan will be more mature, and high-level process supervision will be constructed to achieve free trade and investment facilities, free cross-border capital flows, free and convenient transportation and access for people, and safe and orderly flow of data.
By the middle of the century, a high-level free trade port with strong international influence will be fully established, the plan said.
Cui Weijie, director of the Institute of Industry Development and Strategy under the Chinese Academy of International Trade and Economic Cooperation, said the preferential policies will help offer more products worldwide with lower prices, provide higher-quality services and create more jobs in Hainan.
Cui expected to see more measures that center on zero tariffs for the trade of goods in the future, as the nation is working hard to enable the free flow of trade and investment for Hainan.
Chi Fulin, president of the Haikou-based China Institute for Reform and Development, said the construction of a free trade port in Hainan is part of China's larger drive to promote economic globalization, and it will help cushion the effects of COVID-19.
"The move has demonstrated China's firm determination to open its doors wider to the outside world and deeply integrate itself into the global economy," Chi noted.
According to Chi, to expand opening-up at a higher level, the central government needs to grant greater autonomy to Hainan to carry out reforms and innovation and establish the system and mechanism suitable for the construction of the free trade port.
More efforts are also needed to further implement zero tariffs on daily consumer goods and speed up the construction of an international tourism and consumption center in the province, Chi added.
Editors' Picks
