China's announcement in the summer of 2020 of a grand master plan to build the entire Hainan Island into a Free Trade Port will prove to be the province's biggest policy windfall since it attained provincial status in 1988.
The master plan's monumental scope, covering every detail about the island's market and industry from taxation to jurisdiction, and reaching as far as 2050 in its visionary frame with phased steps and goals, is a testament to China's ambition and determination to reinvent the tropical island into both an international platform for greater globalization and a domestic growth powerhouse.
Particular emphasis is placed on the FTP's liberalization and facilitation on six fronts, ranging from trade and investment to capital flows and customs supervision, with the ultimate goal of building a modern industrial system in Hainan, especially in tourism, modern service and high-tech industries.
Highlights of its policy windfalls include:
Maximum personal income tax of 15 percent for eligible talents;
Tax exemptions on imports and sales for overseas exhibits during exhibitions;
Offshore duty free shopping quota raised to 100,000 yuan ($14,000);
Categories of duty-free products expanded;
Corporate income tax of 15 percent on encouraged industrial enterprises;
Corporate tax exemptions on certain FDI in tourism, services & high-tech industry.
Implementing a more convenient visa free entry policy;
Salary ranges employed as main indices to evaluate talents;
Negative list management on the issuing of work permits for foreign employees;
Foreigners able to serve as legal representatives in public institutions and enterprises.
Conducting a special list of market access to Hainan FTP;
Treating domestic and foreign enterprises as equals in government procurement;
Constructing a negative list of foreign investment access to Hainan FTP;
Foreign universities with certain specialties to open campuses independently in Hainan;
Opening up basic telecommunications services in a safe and orderly fashion;
Conducting cross border asset management services;
Opening up value added telecommunications services;
Expanding the scope of cross border asset transfer;
Removing restrictions on overseas ship and aircraft financing.
Industrial Development Activities
Building an international aviation hub;
Building a shipping hub for the New Int'l Land-Sea Trade Corridor;
Building Yangpu Port into an international port of registry;
Building a pilot zone for cruise ship tourism;
Building a pilot zone for the yacht industry;
Building Hainan into an international Design Island;
Granting greater autonomy to various industry organizations.