Hainan on track to achieve independent customs operations: governor

Hainan is on track to achieve independent customs operations by the end of the year, as China moves forward in building its southernmost island province into a free trade port (FTP) as a premier gateway for the country’s opening-up, said Governor Liu Xiaoming in Beijing on Friday.

China released a master plan in June 2020 to build Hainan into a globally influential, high-level free trade port by the middle of the century.

According to the institutional design, the China Customs builds up a “first line” between the FTP and other countries and regions beyond the customs territory of the People’s Republic of China, and a “second line” between the FTP and the rest of the Chinese mainland.

“Achieving independent customs operations is a key objective in the master plan for building the Hainan Free Trade Port. It serves as a fundamental and landmark step in the development of the Hainan Free Trade Port, which also marks a significant milestone,” Liu said in an interview with China Global Television Network (CGTN) on the sidelines of the third session of the 14th National People’s Congress.

The governor explained the special customs mechanism, noting that some people might mistakenly associate the term with isolation.

“When people hear the term ‘independent customs operations’, they many associate the practice with some sort of a closed-door move. However, that’s not the case. In essence, the independent customs operations feature free flow through the ‘first line’ and efficient control at the ‘second line’. To summarize, the Hainan FTP is open to international trade.  But due to tax and policy differences [between the port and the mainland,] controls are necessary at the ‘second line’, where designated ports must be established,” he said.

“We’ve made steady progress in pushing for independent customs operations, with five key systems, namely, policy, infrastructure, risk prevention and control, industry, and organizational support basically in place,” Liu said.

With the building of the Hainan FTP, the number of newly registered foreign trade companies in the province has surpassed 70,000 since June 2020, contributing significantly to the growth of Hainan’s foreign trade.Hainan is on track to achieve independent customs operations by the end of the year, as China moves forward in building its southernmost island province into a free trade port (FTP) as a premier gateway for the country’s opening-up, said Governor Liu Xiaoming in Beijing on Friday.

China released a master plan in June 2020 to build Hainan into a globally influential, high-level free trade port by the middle of the century.

According to the institutional design, the China Customs builds up a “first line” between the FTP and other countries and regions beyond the customs territory of the People’s Republic of China, and a “second line” between the FTP and the rest of the Chinese mainland.

“Achieving independent customs operations is a key objective in the master plan for building the Hainan Free Trade Port. It serves as a fundamental and landmark step in the development of the Hainan Free Trade Port, which also marks a significant milestone,” Liu said in an interview with China Global Television Network (CGTN) on the sidelines of the third session of the 14th National People’s Congress.

The governor explained the special customs mechanism, noting that some people might mistakenly associate the term with isolation.

“When people hear the term ‘independent customs operations’, they many associate the practice with some sort of a closed-door move. However, that’s not the case. In essence, the independent customs operations feature free flow through the ‘first line’ and efficient control at the ‘second line’. To summarize, the Hainan FTP is open to international trade.  But due to tax and policy differences [between the port and the mainland,] controls are necessary at the ‘second line’, where designated ports must be established,” he said.

“We’ve made steady progress in pushing for independent customs operations, with five key systems, namely, policy, infrastructure, risk prevention and control, industry, and organizational support basically in place,” Liu said.

With the building of the Hainan FTP, the number of newly registered foreign trade companies in the province has surpassed 70,000 since June 2020, contributing significantly to the growth of Hainan’s foreign trade.