Hainan, China will make "island-wide customs closure"! What is the impact on foreign trade?
Hainan, China will make "island-wide customs closure"! What is the impact on foreign trade?
On the afternoon of March 29 Beijing time, at the Boao Forum for Asia, the Hainan Provincial Government Information Office held a press conference titled "The Time is Ripe for Vigorous Development," where they announced the progress and achievements made in the comprehensive deepening of reform and opening up in Hainan Province over the past five years. As for the future work arrangements for the construction of Hainan, Wang Bin, spokesperson of the CPC Hainan Provincial Party Committee, member of the Provincial Party Committee, and Minister of the Provincial Propaganda Department, stated that by the end of 2025, the Hainan Free Trade Port will start its island-wide customs closure in due course.
As of now, all the preparatory tasks for the island-wide customs closure in Hainan have made phased progress. The overall preparations for the island-wide customs closure have been launched to ensure that the hardware conditions for the customs closure are in place this year, all preparatory tasks for the customs closure are completed by next year, and the island-wide customs closure will be implemented before the end of 2025.
What is "customs closure"? What does "closure" refer to?
"Customs closure" is a customs term referring to the establishment of an "area within the territory but outside the customs zone", where the island can enjoy preferential policies such as zero tariffs. According to the report, customs closure refers to the establishment of a special area under customs supervision on the whole island of Hainan.
What impact will the island-wide customs closure in Hainan have on import and export trade?
According to Yang Lin, a second-level director and officer of the Deep Reform Office of Hainan Provincial Committee (Office of the Working Committee of the Free Trade Port), after the closure of the island’s customs, on the one hand, the vast majority of imported goods (excluding those in the taxable goods list) in Hainan Free Trade Port are exempt from tariffs; on the other hand, goods outside the prohibited and restricted lists can freely enter and exit, which will lead to more frequent trade between Hainan and the rest of the world, promote the prosperity and development of import and export trade, and encourage Hainan to participate more in international division of labor.
Hainan's "customs closure" does not mean "island closure". On the contrary, the island-wide customs closure means that the connectivity between Hainan Free Trade Port and the outside world will be smoother, which represents a higher level of openness. In the past two years, China has been continuously issuing policies to stabilize foreign trade, to help Chinese companies ease difficulties and boost their foreign trade development.
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