HAIKOU, China, Dec. 18, 2025 — On Thursday, China initiated special customs operations across the entire Hainan Free Trade Port (FTP), the world’s most expansive FTP by land area. This facilitates easier import of foreign goods, broadens the scope of zero-tariff policies, and introduces further measures to improve the business climate.
This step is broadly recognized as a pivotal moment in China’s drive to advance free trade and extend high-level opening-up, even as global protectionist trends increase.
As part of the new framework, the tropical island spanning over 30,000 square kilometers is now classified as a special customs supervision zone, signifying a fresh phase for the Hainan FTP’s evolution.
International firms operating there will enjoy a business setting more attuned to global norms, reduced taxation and operational expenses, wider entry to service industries such as healthcare and education, and the opportunity to leverage Hainan as a gateway to the extensive mainland Chinese market.
Authorities characterize the special customs regime as offering “freer access at the first line,” meaning more liberalized trade between Hainan and regions beyond China’s customs territory, and “regulated access at the second line,” which entails standard customs procedures for goods entering the mainland from Hainan.
The proportion of zero-tariff goods within the Hainan FTP has increased from 21 percent to 74 percent, with the catalog of eligible items growing from 1,900 to more than 6,600.
Zero-tariff items manufactured in Hainan can be exported to the mainland without additional duties, provided local processing adds at least 30 percent to their value.
Hainan, once a remote and less-developed area, was designated as China’s biggest special economic zone in 1988. A 2020 blueprint aimed to transform the island into a high-caliber FTP with worldwide impact by mid-century.
According to official statistics, over 9,600 enterprises with foreign investment have been registered in Hainan since 2020.
The commencement date of Dec. 18 aligns with the anniversary of a pivotal CPC meeting in 1978, commonly viewed as the beginning of China’s period of reform and opening-up.
In recent decades, China has created 22 pilot free trade zones, removed foreign investment limits in the manufacturing sector, and opened markets wider in areas like telecommunications, healthcare, and education.
Source: Hainan Free Trade Port
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