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Hainan yacht industry buoyed by policy vision

Updated: China Daily
A flotilla of boats enters the mouth of the Sanya River on July 6. FENG SHUO/FOR CHINA DAILY

Almost every morning, the coastline of Sanya in Hainan province transforms into a shimmering spectacle, with a flotilla of yachts moored at bustling ports poised to set sail on their maritime adventures.

Sanya, with its abundant aquatic resources and favorable tropical climate, has emerged as a magnet for international and domestic visitors eager to embark on yachting trips and enjoy blue skies and sparkling waters.

"Except for occasional typhoons, Sanya can almost achieve more than 350 seagoing days throughout the year," said Gao Yongning, deputy director of the cruise and yacht department of the Sanya Central Business District Administration.

Hainan is home to over 13,000 yacht-related enterprises, and boasts 14 operational marinas and 2,511 yacht berths.

Sanya, a southern coastal city of the province, has emerged as a standout destination for the leisure activity. More than 7,300 yacht enterprises, making up 22.7 percent of China's total yacht-related businesses, were located there as of June, according to a report by Hainan Daily.

The city also accommodates a registered yacht fleet exceeding 1,400 vessels, according to the Sanya Maritime Safety Administration, with the number exceeding its reputation as the "city of a 1,000 yachts".

In the first half of the year, yachts made around 58,000 port entries and exits in Sanya, which received about 367,000 visitors.

During the 40-day Spring Festival travel season, 30,944 port entries and exits were recorded and 212,154 visitors welcomed. The numbers were a record for the holiday period, the administration said.

Free trade benefits

The establishment of the Hainan Free Trade Port has emerged as a catalyst to propel Sanya's yacht tourism. In 2021, Hainan introduced a zero-tariff policy on vehicle and yacht imports, exempting registered enterprises in the province's transportation and tourism sectors from import duties on vehicles, aircraft, ships, and yachts.

In July 2022, the government in Hainan issued regulations aimed at accelerating the growth of the yacht industry in the free trade port. These regulations enable overseas residents working in Hainan and holding a residence permit to apply for yacht registration in Hainan, bolstering efforts to boost yacht sales.

On Feb 5, 2024, the Sanya Central Business District Special Fund Incentive Measures for Cruise And Yacht Industry Development was announced.

The fund provides incentives and support for the development of the yacht industry in five aspects: operational rewards; operational space subsidies; scientific and technological innovation support; fixed asset investment incentives; and incentives for the sale of new energy yachts.

"Following the introduction of regulations and policies, the yacht-leasing sector has entered a period of rapid growth," said Liu Yangliu, general manager of Hainan Visun Yacht Industry Development (Investment) Group.

Wakesurfing, a favorite water activity among younger people, is also gaining greater attention.

Chen Xiaoyu, executive director of Sanya Serenity Marina, said there has been an influx of wakesurfing clubs in the area in recent years, with over 50 wave-making boats mooring at the marina.

The development of the yacht industry has also dovetailed with sectors such as wedding photography, catering, event hosting and provision of accommodation, which have also enjoyed notable success.

Visitors inspect boats and yachts during the Haikou Boat Show in April in Haikou, Hainan province. YI HAIFEI/CHINA NEWS SERVICE/YANG HE/FOR CHINA DAILY

Captain's choice

Despite the surging success of the yacht industry, the scene was vastly different three decades ago.

Back then, there were just over 1,000 households on Xidao Island off Sanya, with the majority earning a living from fishing. "I always envisioned a life as a fisherman," said Mai Shineng, while reminiscing about his previous life spent fishing beside his father.

With the transformation of the picturesque small island into a tourist hot spot, Mai left the unpredictable life of a fisherman for a more secure livelihood as a ferry captain.

In 2010, he become captain of a yacht and a pioneering helmsman in Sanya.

Mai was not alone in abandoning his old fishing job. Scores of long-term inhabitants of Xidao Island chose the regular work and stable income provided by the yacht industry over the uncertain returns from fishing, Mai said.

Fishermen are limited to the waters around Sanya due to the capacity and range of their boats. They are also restricted by annual fishing moratoriums, which are imposed to ensure healthy fish stocks.

Since he became a yacht captain, Mai has sailed to nearly all the coastal provinces of China, which has broadened his perspective, he said. His new occupation has also given him the opportunity to compete in, and win, sailing regattas.

During these events, he keeps a watchful eye out for yachts and sailboats that appear to be in trouble.

In 2022, Mai spotted a sailboat over 1 kilometer away drifting aimlessly on the waves. He quickly reported the situation to the race organizers and joined the rescue mission.

"At sea, unity, friendship, and mutual assistance are essential for achieving better outcomes," said Cui Xiaojin, head of marketing at Hainan Hongzhou Marine Tourism Co.

Cui praised Mai's leadership in nurturing the skills and cooperative spirit of yacht captains, and helping provide talent for Sanya's yacht industry.

Visitors inspect boats and yachts during the Haikou Boat Show in April in Haikou, Hainan province. YI HAIFEI/CHINA NEWS SERVICE/YANG HE/FOR CHINA DAILY

A little luxury

Hongzhou Yacht Marina, the largest commercial yacht base in Hainan province, has undergone a major transformation in recent years.

"A decade ago, Hongzhou Yacht Marina was a bustling fishing harbor — with a multitude of boats moored — that an unpleasant odor emanated from that greatly inconvenienced residents and visitors," said Cui, whose company later repurposed it into the yacht marina.

Yachting, once a luxury pastime for the affluent due to the high purchase price of the boats and maintenance costs, is now accessible for more people, he said.

"Initially, yachts were predominantly used for commercial services," Cui said. "However, owners soon realized they could lease their vessels during downtimes to help defray maintenance expenses."

This shift gave rise to yacht chartering and pooling in 2014, a flourishing business that has advantages for both owners and tourists who want to experience opulence on the seas.

The implementation of hourly yacht rentals has increased the affordability of yacht tourism, said Gao Yongning, deputy director of the cruise and yacht department of the Sanya Central Business District Administration.

With the increasing availability of yachts and the maturation of the market, rental prices have plummeted from over 10,000 yuan ($1,400) to less than 1,000 yuan, making yachting increasingly accessible and boosting its popularity.

"For a three-hour yachting escapade for my family of four, the cost is now under 1,000 yuan," said Zhang, a visitor from Sichuan province.

Sanya is now home to five yacht marinas, with the Hongzhou Yacht Marina having a capacity of 450 berths and hosting around 420 yachts year-round.

A technician from Lingao Haiquan Yacht Co works on a luxury yacht in Lingao, Hainan province, on Tuesday. [Photo provided to CHINA DAILY]

Changing tack

However, a series of challenges and obstacles, which experts say need urgent attention, are testing the yacht industry in Hainan.

The upstream aspect of the industry involves design and manufacturing, the midstream sales and consumption, while the downstream covers maintenance, repairs, and financial services, said Hu Xiaoming, a special adviser to the Sanya Central Business District Administration and general manager at Hainan Marine Trade Exchange Services.

Zuo Zhiyong, secretary-general of the Sanya Cruise and Yacht Association, said "even within the midstream segment, where Hainan's yacht industry shines, there are shortcomings".

Despite flourishing yacht tourism in Sanya, operational costs have been hampered by high berthing fees, Zuo said. For instance, one well-known yacht club in Sanya pays an annual fee of around 1 million yuan to berth nine yachts.

Sanya has nearly 1,000 yacht berths, and more than 90 percent are privately owned. This has led to a shortage of affordable public berths, Zuo said.

Another critical part of the industry that needs attention is the upstream design segment, experts said.

Hu believes there is an urgent need to accelerate recruitment and training of yacht designers as well as specialists in construction, woodworking, plumbing, fiberglass work, sheet metal painting, electromechanical installation, and technical evaluation.

After setting up operations in the Lingao Jinpai Port Development Zone, Lingao Haiquan Yacht Co has boosted its manufacturing capacity, resulting in an uptick in orders.

"The growth potential of the yacht industry within the Hainan Free Trade Port is substantial," said Wu Yanfeng, assistant to the company's general manager.

In order to attract more yacht manufacturers to the province, facilities to support the industry need to be expanded and better access to land and marine resources guaranteed, Wu said.

"We hope that raw materials such as steel plates and paint can be supplied locally. Additionally, the construction of suitable sheltered harbors and yacht berthing areas are essential to alleviate the concerns of businesses," Wu added.

The company has secured orders worth about 25 million yuan this year, coming from countries including Singapore and the United Arab Emirates. It is aiming to produce 20 vessels this year, with a total output value of 80 million yuan.

"Under the Hainan Free Trade Port, we want to explore international markets and promote China's 'smart manufacturing' new energy yachts on a global scale," he said.

Visitors inspect boats and yachts during the Haikou Boat Show in April in Haikou, Hainan province. YI HAIFEI/CHINA NEWS SERVICE/YANG HE/FOR CHINA DAILY

Showcase event

The Haikou Boat Show, a support event of the China International Consumer Products Expo since 2021, has also played a major role in driving the yacht economy in Hainan.

The exhibition aims to not only showcase vessels and businesses, but also offer a space to foster cross-industry growth and advance Hainan's yacht sector.

"Featuring sleek and innovative designs, the showcased yachts offer a fusion of novel features and experiences," Du Hongyu said while visiting the consumer expo.

This year's Haikou Boat Show was held from April 13 to 18. Visitor turnout on April 15 was double that of the previous year, underscoring the event's growing appeal and popularity.

Wang Min, chairman of the Haikou Tourism and Culture Group, said this year's focus on high-quality and new products, had enhanced the exhibition's appeal. A total of 250 yachts were featured at the event, a 14 percent increase from the previous year. The vessels included 120 from 80 international companies.

At a seminar on development of the yacht industry held during the expo, experts and observers highlighted China's huge consumption potential in the sector.

Liao Minsheng, a maritime economy expert and vice president of Hainan Tropical Ocean University, said as people's living standards rise, the consumer base for yacht tourism is gradually expanding. The yacht tourism market has been experiencing rapid growth in recent years, emerging as a new hot spot for consumer spending, as exemplified by Sanya's success, Liao added.

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