On Dec. 18, 2025, the Hainan Free Trade Port officially launched island-wide special customs operations. Since then, many businesses have shifted from a wait-and-see stance to strategic layout, and from tentative trials to in-depth development.
Statistics show that between the launch of island-wide special customs operations and May 31, 2026, a total of 172,100 new market entities were registered in Hainan, a year-on-year increase of 61.07 percent. Among them, 139,500 were newly established enterprises, up 123.04 percent.
What underpins this magnet effect? How do policy advantages translate into developmental thrust? Three illustrative cases provide insights:
Global repair hub redefining value chains
On the first day of island-wide special customs operations, the Haikou branch of SonoScape Medical Corp fulfilled the first order of bonded maintenance services for both-ends-abroad clients for endoscopes. The company, headquartered in Shenzhen, south China's Guangdong Province, sells independently developed products to more than 170 countries and regions.
A July 2025 Hainan policy revision classified endoscopes among 38 approved items eligible for internationally oriented bonded maintenance. As general manager Li Xiaoxi explains, offshore service centers often lack advanced repair capabilities, while some replaced components historically faced import restrictions. The Free Trade Port now enables comprehensive refurbishment, reuse, and value-chain upgrading.
"This facilitates the repatriation of high-value industrial segments previously anchored overseas," Li emphasized.
Six Hainan enterprises now hold bonded maintenance licenses, with three activating operational frameworks. Fifteen international maintenance batches exceeding 3.5 million yuan (about $516,620) have been processed under the updated regulatory regime.
An engineer of Haikou Meilan Airport HES Aircraft Engine Maintenance Engineering Co., Ltd. repairs an aircraft engine, March 23, 2026. (Photo: People's Daily)
Advanced manufacturing anchor ignites development
At the Yangpu Economic Development Zone in Danzhou, Hainan, construction is in full swing on the Siemens Energy Hainan Gas Turbine Assembly Base and Service Center, which is scheduled to begin operations in 2027.
"This is a comprehensive facility integrating manufacturing, final assembly, engineering services, and research and innovation," said Li Rui, deputy general manager of the energy development department at Yangpu International Investment Consulting Co., Ltd. "It is also the first landmark foreign-invested manufacturing project to be established in Hainan after island-wide special customs operations were launched."
Photo shows a container terminal at Yangpu Port, south China's Hainan province. (Photo: People's Daily)
The relationship between Yangpu Economic Development Zone and Siemens Energy dates back more than three decades.
"In 1994, just two years after the Yangpu Economic Development Zone was established, development was still in its early stages. We introduced two Siemens gas turbines to address power shortages," recalled Hu Cheng, chief engineer of Yangpu Power Plant.
At the time, the turbines were among the most advanced in the world and played a crucial role in supporting the development zone’s early growth. Over the years, Siemens Energy regularly dispatched specialists for maintenance work, and engineers from both countries forged lasting friendships.
Siemens Energy conducted inspection tours for potential cooperation in 2023, set up its Hainan innovation center in 2024, and has now launched a brand-new facility here. The company keeps ramping up investment out of not only long-standing ties but also full confidence in the Hainan Free Trade Port's long-term growth, an executive of Siemens Energy Greater China explained.
While serving Hainan, the facility will also be developed into a regional center for high-end clean-energy equipment manufacturing and services covering Southeast Asia.
"Hainan enjoys clear geographical advantages and is building itself into a clean-energy island. Yangpu has a deep-water port located close to major international shipping routes. Combined with free trade port policies such as zero tariffs and visa-free access, the conditions for development are highly favorable, " the executive added.
Longtime partners are expanding their presence, while new investors continue to arrive. Between the launch of island-wide special customs operations and May 31 this year, Hainan registered 1,240 new foreign-invested enterprises, representing year-on-year growth of 37.62 percent.
A new exploration
Before island-wide special customs operations, the Hainan Free Trade Port's hallmark policies, characterized by zero tariffs, low tax rates, and a simplified tax system, were primarily designed to support industrial development and businesses.
How can these benefits more directly reach everyday consumers?
In February this year, Hainan introduced a new policy granting zero-tariff treatment to imported goods purchased by residents within the Hainan Free Trade Port. The first five duty-free stores for daily consumer goods opened in Haikou, Sanya, and Danzhou.
The initiative spans 202 categories of high-turnover consumer goods, including foods, personal care items, household essentials, and maternal & infant products. Eligibility extends to Hainan-registered residents, local residence permit holders, and qualifying foreign permanent residents, each entitled to shop duty-free with an annual cap of 10,000 yuan. This enables island residents to globally source premium goods locally -- without leaving Hainan.
The new policy quickly attracted widespread attention. Shao Yuanyuan, manager of a duty-free daily consumer goods store operated by China Duty Free Group, recalled that hundreds of shoppers packed the store on the opening day, eager to explore the new shopping experience.
According to Haikou Customs, between the launch of island-wide special customs operations and May 31 this year, sales for offshore duty-free shopping reached 20.34 billion yuan, up 20.5 percent year on year.
"I believe the duty-free policy for Hainan residents will continue to be refined, just as the offshore duty-free policy has evolved over time," said Hao Zhiqiang, deputy general manager of Haikou International Duty Free City. "It will enhance the quality of life for local residents while creating even greater opportunities for businesses."