Hainan Fully Implements Customs Closure

HAIKOU, Dec. 18 (Xinhua) — Hainan Free Trade Port (FTP) officially launched comprehensive customs closure on December 18, 2025, marking a milestone in China’s high-level opening-up drive. This landmark move, which designates the entire island as a special customs supervision area, has unleashed a new wave of opportunities for international trade partners by overhauling policies on cross-border logistics, production, warehousing, and product access. With the core framework of “opening up the first line, controlling the second line, and free flow within the island,” Hainan is poised to become a key hub linking the Asia-Pacific region to the global market, offering tangible benefits to businesses worldwide.

The customs closure initiative, backed by a series of policy documents including the Notice on Tax Policies for Goods Entering and Exiting the “First Line” and “Second Line” of the Hainan Free Trade Port and Circulating Within the Island, has fundamentally optimized the international logistics landscape. Leveraging its geographical advantage as a gateway between Asia-Pacific and the rest of the world, Hainan has upgraded its transportation infrastructure, with Haikou Meilan, Sanya Phoenix International Airports expanding international routes and Haikou New Port, Yangpu Port enhancing maritime capacity. These ports, part of the 10 “second line” checkpoints connecting Hainan to the Chinese mainland, have implemented streamlined customs clearance procedures supported by digital booking systems, enabling 80% of outbound goods to be processed efficiently.

For international logistics operations, the “zero-tariff, low tax rate, simplified tax system” policy has drastically reduced transit costs and time. Customs data shows that goods transiting through Hainan now enjoy 30%-50% faster declaration, inspection, and release processes compared to traditional routes, minimizing storage and detention fees. “Hainan’s strengthened integration with global shipping and air routes ensures seamless connectivity to major markets, making it an ideal choice for optimizing supply chain layouts,” noted an official from the Hainan Provincial Department of Commerce. This efficiency boost has been widely anticipated by multinational logistics firms, which see Hainan as a catalyst for improving the timeliness of goods delivery to Asian and global markets.

The production and manufacturing sector in Hainan has also emerged as a new magnet for international investment, thanks to preferential policies and improved industrial support. Post-customs closure, Hainan has expanded its “zero-tariff” list from over 1,900 tariff items to 6,600, covering 74% of all commodities, and introduced a 15% corporate income tax rate for eligible industries—well below the global average. Key incentives include full tariff exemption on imported raw materials and auxiliary materials for production, and a policy allowing duty-free domestic sales if processed products achieve over 30% value-added locally.

Real-world cases highlight these benefits: a Hainan-based nut processing enterprise imported South African macadamia nuts, processed them locally to meet the 30% value-added threshold, and sold them to the Chinese mainland with 12% import duty exempted. Similarly, medical firms using Southeast Asian latex to produce catheters have saved millions in tariffs. Additionally, Hainan has relaxed trade management for “two-end overseas” businesses—those importing raw materials and exporting finished products—allowing 38 new commodities including auto engines to be processed under bonded maintenance, opening new business avenues for international automotive parts suppliers.

Hainan’s warehousing industry, equipped with advanced intelligent management systems, is another highlight of the post-customs closure ecosystem. A network of high-standard bonded logistics centers offers deferred tax payment for stored goods, freeing up working capital for businesses—particularly beneficial for seasonal products. “Goods stored in Hainan can be quickly distributed to both the Chinese mainland via convenient cross-border channels and international markets in Southeast Asia and Australia, shortening the inventory-to-sales cycle,” explained a manager at a Hainan-based international logistics warehouse. Customized services such as bonded processing, sorting, and packaging further cater to diverse market demands, reducing intermediate operational links.

The policy dividends have resonated globally, with international figures acknowledging Hainan’s role in boosting open global trade. “Hainan’s customs closure is a landmark step in China’s opening-up, providing new opportunities for trade, capital flow, and personnel exchanges,” said Philip Laird, Vice President of Trinity Western University in Canada. Emirati Minister of State for Foreign Trade Thani Al Zeyoudi noted that Hainan’s policies are highly attractive to Emirati investors, promising to enhance UAE-China economic ties. South African and Serbian business leaders also expressed enthusiasm, seeing Hainan as a gateway to the Chinese and Asian markets.

As Hainan enters a new era of development, the customs closure initiative is not just a domestic policy adjustment but a commitment to fostering win-win international cooperation. With streamlined logistics, favorable production policies, advanced warehousing services, and broad market access, Hainan is set to reshape regional trade dynamics and offer sustained value to global partners. Industry insiders predict that the island will attract a surge of international investment in the coming years, driving growth in cross-border trade and logistics for the Asia-Pacific region and beyond.