2024-11-15
October 31, at the WTA· Xianghu Dialogue 2024 in Sanya, Hainan, Mr. CHEN Tiejun, Secretary of the Party Leadership Group and Director-General of the Department of Tourism, Culture, Radio,Television, and Sports of Hainan Province of China, delivered a keynote speech on "How Hainan Free Trade Port Policies Boost the Market in the Asia-Pacific Region". Below is a summary of the key points discussed.
Hainan, China’s largest special economic zone and a world-renowned tropical island destination, has long attracted global visitors with its abundant natural resources and diverse cultural heritage. Today, Hainan is flourishing with vitality, emerging as a new growth hub for the Asia-Pacific tourism market. This transformation is driven by the comprehensive implementation of Hainan Free Trade Port policies.
1. Opening-Up Policies for Visa Entry. The visa entry policies under the Hainan Free Trade Port have significantly bolstered inbound tourism. Version 1.0: 59-Country Visa-Free Policy. Since May 1, 2018, with the approval of the State Council, Hainan has implemented a visa-free entry policy for tourists from 59 countries. Starting February 9, 2024, this policy was expanded to include visits for purposes beyond tourism, such as business, family visits, medical care, conventions, and sports competitions. Visitors can now stay for up to 30 days for these activities, except work or study. Version 2.0: 144-Hour Visa-Free Policy for the Foreign Tour Groups via Hong Kong and Macau. Effective July 30, 2024, citizens of countries with diplomatic ties to China can enter Hainan visa-free for up to 144 hours if organized in groups (minimum of two people) by licensed travel agencies in Hong Kong or Macau. Visitors from the 59 visa-free countries still enjoy the original 30-day stay. For citizens of other countries, visas can be processed locally in Hainan if they require stays longer than 144 hours. In fact, the 2.0 version of the policy signifies that Hainan has implemented a visa-free policy for the entire world, which represents the highest level of openness in China’s tourism sector, significantly boosting inbound tourism. From January to September 2024, Hainan welcomed 755,000 overseas visitors, a 189% year-on-year increase, with the total expected to surpass one million by year-end.
2. Air Rights and Connectivity Policies. Hainan has rapidly expanded its aviation capacity to support its tourism growth. Haikou Meilan International Airport and Sanya Phoenix International Airport each now handles over 20 million passengers annually, with Qionghai Boao International Airport managing around 1 million. Hainan has established over 300 direct air routes, forming a 4-hour flight radius covering 21 countries and regions and an 8-hour radius covering 59 countries and regions. The introduction of the fifth and seventh freedoms of the air has expanded Hainan’s connectivity. The seventh freedom of the air, in addition to third, fourth, and fifth freedoms, enhances connectivity with the Greater Bay Area and Beibu Gulf urban clusters and fosters the two-way flow of international and regional tourists. As of September 30, 2024, Hainan operates 61 international passenger routes, connecting 32 global cities.
3. Tax Incentives. The Hainan Free Trade Port features a policy framework of zero tariffs, low tax rates, and a simplified tax structure. Zero Tariffs: Following the island-wide independent customs operations in 2025, non-taxable imported goods will be exempt from import taxes—a pivotal step toward zero tariffs. The zero-tariff policy aims at facilitating investment in modern tourism, cultural, and entertainment industries in Hainan, enhancing the appeal of the island’s tourism sector. It helps tap into potential consumer markets and promotes the sustainable development of the tourism market. Low Tax Rates: Enterprises in sectors covered by preferential policies like tourism, culture, and sports enjoy a reduced corporate income tax rate of 15%. High-end and urgently needed talent working in Hainan’s tourism industry also benefit from personal income tax exemptions above 15%. The “Dual 15% Low Tax Rate” policy reduces the tax burden on both businesses and individuals, making Hainan a more attractive investment destination and encouraging the influx of companies and high-level talent. From 2020 to 2023, companies benefiting from corporate income tax incentives have seen a cumulative tax reduction of RMB 23.673 billion. By the end of 2023, the number of market entities in Hainan reached 3.78 million, surpassing 4 million up to the time of reporting, nearly quadrupling from 2020.
4. Comprehensive Supporting Policies. Hainan has introduced complementary measures to enhance its appeal. Financial Policies: Hainan has launched the Free Trade (FT) accounts and established a whitelist mechanism for financial support of high-quality development, enabling the free flow of funds and the internationalization of transactions. The free movement of capital allows businesses and individuals to more flexibly allocate global resources and effectively manage cross-border financial risks. This policy provides convenient and efficient financial services for tourism operators and visitors in the Asia-Pacific region, fostering investment and business operations in Hainan. Education Policies: At the national level, prestigious international universities and vocational institutions in the fields of science, engineering, agriculture, and medicine, are now allowed to independently operate in the Hainan Free Trade Port and establish international schools. This policy is expected to significantly boost the development of international education and tourism in Hainan. Currently, 22 prestigious institutions have already set up campuses in the Lingshui Li’an International Education Innovation Pilot Zone. Medical Policies: The Boao Lecheng International Medical Tourism Pilot Zone is a “medical special zone” with nine preferential policies supporting sectors such as specialty medical care, cancer prevention and treatment, health management, nursing care, anti-aging and cosmetic aesthetics. As China’s only “medical special zone”, it offers high-quality medical services to visitors. Thanks to its pioneering policies, Lecheng has become an international gateway for innovative drugs and medical devices entering the Chinese market. From January to September 2024, the zone welcomed over 300,000 medical tourists and facilitated access to innovative drugs for 40,000 patients.
The Hainan Free Trade Port policies significantly enhance the province’s tourism industry, opening new avenues for tourism exchanges between China and the Asia-Pacific region, enhancing air route cooperation, and promoting professional exchanges. These initiatives also reinforce Hainan’s role in the international tourism market. Hainan warmly invites global tourism partners to collaborate and contribute to the prosperity of the global tourism industry, sharing in the strength and opportunities offered by “Hainan Power”.