Hainan FTP boosts global trade hub

"These comprehensive policies can save customers 10 to 15 percent on maintenance costs. The number of overseas aircraft we serviced in the first half of this year already nearly reached the total for all of last year," Yang said.

Wang Haiye, chairman and general manager of Haikou Airport Aircraft Engineering Co, said: "By building a complete maintenance ecosystem, we attract more planes to Hainan for service, which in turn encourages airlines to open new routes here."

The momentum extends to high-end engine repair. Haikou Engine Service Co Ltd has earned licenses from both the Civil Aviation Administration of China and the US Federal Aviation Administration, and joined GE Aviation's global network.

The company, staffed by 220 employees, has already taken on 26 engine projects.

"It usually takes 120 days to repair one GEnx-1B engine. This year, our target is 15 engines, and we plan to double that to 30 next year," said Wu Dongyang, president of Haikou Engine Service. The facility aims to eventually repair 60 engines annually, generating an output value of more than 3 billion yuan.

Industry officials said the cluster of facilities is forming a comprehensive industrial chain that includes regular aircraft maintenance, engine repair, component repair and painting. Shan Jinxiao, director of the equipment industry and science and technology sector at the Hainan Provincial Department of Industry and Information Technology, projected that the sector's output will grow by over 30 percent this year compared to 2024.

Beyond aviation, Hainan's "value-added tariff exemption policy" is fueling manufacturing expansion. Under the scheme, imported goods are exempt from tariffs if at least 30 percent of their value is added through local processing.

AUSCA International Oils and Grains, based in the Yangpu Economic Development Zone, has been a key beneficiary. Since production began in 2021, the company has saved about 300 million yuan in tariffs, according to chairman Zhang Hui. AUSCA imports soybeans and other raw materials from Brazil and Canada for processing and domestic sales.

"Since our first year of operation, we have accumulated tariff reductions of about 300 million yuan," Zhang said. The policy has since expanded to other sectors.

"It now extends to the health food industry, and in seafood, processing has shifted from primary to deep processing with higher added value," said Feng Nan, deputy director of the Yangpu Economic Development Zone's administrative committee.

As of August, the policy generated 9.52 billion yuan in domestic sales in Yangpu, with tariff exemptions of 737 million yuan — representing over 80 percent of the provincial total.

AUSCA's growth underscores the policy's impact. "We achieved an output value of 1 billion yuan in our first year," said Cao Youhua, the company's deputy general manager. "Our output value reached about 6 billion yuan in 2024 and is projected to rise to 8 billion yuan in 2025."

Hainan officials said the FTP's policy toolkit is maturing, with expanded zero-tariff measures, improved trade facilitation and strengthened rule-of-law safeguards.

According to Haikou Customs, since 2020, the three "zero-tariff "schemes — covering raw materials, self-use production equipment, and operational transport vehicles and yachts — have been gradually expanded, now spanning "sea, land and air".

As of this year, the cumulative import value of zero-tariff goods has reached 25.5 billion yuan, with 4.9 billion yuan in tax breaks benefiting 558 enterprises.

Meanwhile, processing value-added tariff exemptions have been extended island-wide. To date, 129 enterprises have registered, with 51 actively conducting business, generating a cumulative 10.9 billion yuan in domestic sales and tariff exemptions of 850 million yuan. Beneficiary industries include pharmaceuticals, seafood and jewelry.

Since the rollout of new duty-free shopping rules, Customs authorities have supervised over 200 billion yuan in duty-free sales, 30 million duty-free shoppers and 247 million items. The policy has reinforced the province's ambition to become an international tourism consumption hub.

At Bo'ao Lecheng International Medical Tourism Pilot Zone, a "special medical zone" has been established to facilitate zero-tariff imports of medicines and medical devices. By mid-2025, the zone had imported 225 million yuan worth of such products, enjoying 29.47 million yuan in tax breaks.

Provincial officials said these advances are part of broader efforts to link domestic and overseas markets while attracting high-quality resources to Hainan.

Ma Mengmeng contributed to this story.

Contact the writers at wangzhuoqiong@chinadaily.com.cn