Group 1 - The meeting of the Provincial People's Congress Standing Committee emphasized the importance of implementing the spirit of the Provincial Party Committee's 8th Plenary Session, particularly in enhancing the level of public welfare and ensuring that citizens feel the benefits of the Free Trade Port construction [2] - The meeting highlighted the need for the People's Congress to play a leading role in legislation, focusing on key areas such as housing, education, healthcare, and employment, to address public concerns through high-quality legislation [2] - Effective supervision is essential to ensure the implementation of public welfare policies, with a focus on specialized inquiries and law enforcement inspections to enhance accountability and results [2] Group 2 - The meeting discussed the importance of monitoring the implementation of public welfare projects to improve efficiency and quality, as well as preparing for the collection of provincial public welfare project proposals for 2026 to reflect public opinion accurately [2]

Core Points - The Hainan Free Trade Port will officially start its full island closure operation on December 18, 2023, marking a significant historical milestone in China's reform and opening-up process [1] - The closure operation is expected to enhance Hainan's international competitiveness and facilitate smoother connections with global markets [1][2] - The new policies will implement a "one line open, two lines control, and island-wide freedom" approach, allowing for greater trade liberalization and facilitation [2] Policy Changes - The number of zero-tariff import items will increase from approximately 1,900 to about 6,600, raising the proportion of zero-tariff items from 21% to 74% [2] - The new negative list management for zero-tariff goods will replace the previous positive list, allowing for more comprehensive trade facilitation [2] - The introduction of a comprehensive list of prohibited and restricted import/export goods will enhance trade transparency and compliance with international standards [5] Economic Impact - Hainan's actual foreign investment reached 102.5 billion yuan over the past five years, with an annual growth rate of 14.6%, indicating strong global capital attraction [7] - The tourism sector, particularly duty-free shopping, is expected to see increased attractiveness, with Hainan currently holding over 8% of the global duty-free market share [9] - The modern service industry, including aircraft maintenance, is expanding rapidly, with over 2,200 aircraft serviced since the establishment of a one-stop maintenance base [9][10] Industry Development - The four leading industries now account for 67% of Hainan's GDP, with marine production growing at an annual rate of 13.9% [10] - High-tech industries are emerging as a core competitive advantage for Hainan, focusing on areas like genetic resource protection and deep-sea equipment development [10] - The green technology transition in manufacturing, exemplified by a lithium hydroxide project, is expected to enhance global competitiveness and achieve an annual output value exceeding 2 billion yuan [10][11] Future Prospects - The Hainan Free Trade Port aims to attract global asset management institutions, enhancing the investment landscape for international investors [8] - The ongoing optimization of the business environment is expected to lower operational costs for foreign enterprises, facilitating better market engagement [8] - Hainan's strategic location along the Maritime Silk Road positions it as a key player in global resource allocation and trade [8]

Core Viewpoint - Hainan Free Trade Port will officially start its full island closure operation on December 18 this year, with 10 "second-line ports" commencing customs supervision for cargo inspection [1] Group 1: Customs Operations - Haikou New Port "second-line port" is a major port for vehicle roll-on/roll-off transport between Hainan and the mainland, also handling cargo and passenger transport [1] - Customs will implement supervision on "three types of goods" including "zero tariff," relaxed trade management measures, and tax exemption for processing and value-added [1] - The customs process at the inspection site allows vehicles to pass through in about one minute under normal conditions without any anomalies or customs control instructions [4] Group 2: Smart Supervision - The customs will adopt a "smart supervision, credit supervision, situational supervision, and collaborative management" approach for efficient and precise regulation at the "second-line ports" [3] - The customs smart supervision platform has integrated with the China (Hainan) International Trade Single Window platform, utilizing a big data pool for automatic risk assessment of goods [3][6] - Vehicles flagged for customs control will undergo image scanning, with the entire scanning process taking less than two minutes [6] Group 3: Credit Management and Efficiency - A credit clearance system will be established for over 70,000 foreign trade entities in Hainan, with AEO enterprises enjoying the lowest inspection rates and fewer audits [8] - Enterprises can benefit from "one-stop clearance" by submitting cargo export information online, allowing for coordinated operations among customs and security departments [8] - Multiple rounds of comprehensive drills have been conducted at the Haikou New Port and South Port "second-line port" inspection site, demonstrating high overall passage efficiency [8]

Group 1 - The core viewpoint is that after the closure operation of Hainan Free Trade Port, customs will implement a management system that features "open on the first line, controlled on the second line, and free within the island" [1] - Customs will manage three categories of goods at the "second line" port: "zero tariff" goods, goods enjoying processing value-added policies, and goods with relaxed trade management measures [1] - The customs will set up customs supervision channels and non-customs supervision channels at the "second line port" to facilitate trade between Hainan and the mainland [1] Group 2 - The customs will implement a convenient clearance model called "direct release" for imported "zero tariff" goods and bonded goods, which simplifies the declaration process significantly [2] - The "direct release" policy was first piloted in June 2020 and has been gradually expanded to various bonded areas, allowing for a reduction in the number of declaration items from 105 to 33 for eligible goods [2] - Goods eligible for "direct release" are generally low-risk as they do not involve inspection, certification, or taxation, leading to faster clearance times [2]

Core Viewpoint - The Hainan provincial government is actively promoting the implementation of the "Qiong-Hong Cooperation Memorandum" to enhance collaboration with Hong Kong, aiming to create a high-level open cooperation model that is globally oriented [1] Group 1: Strategic Initiatives - The provincial government emphasizes a proactive approach and bold exploration to quickly establish a new phase of Qiong-Hong cooperation, targeting significant achievements [1] - A pragmatic strategy focusing on "small breakthroughs" will be adopted, concentrating on key areas such as trade and investment facilitation, aiming for smooth alignment with international high-standard rules [1] Group 2: Development Areas - The government plans to accelerate the establishment of cooperation demonstration zones in Haikou and Sanya, enhancing collaboration in sectors like biomedicine, high-end consumer goods manufacturing, and retail [1] - There is a strong push for deep integration of industrial chains, supply chains, and value chains in advantageous sectors such as digital economy, financial openness, and tourism consumption [1] Group 3: Cooperation Mechanisms - The government aims to improve cooperation mechanisms, leveraging the window period before the Hainan Free Trade Port's closure operations to enhance work connectivity and cultural exchanges [1] - The exploration of more open and flexible policy measures is intended to achieve regular communication and collaboration between Qiong and Hong Kong, further deepening cooperation for mutual benefits [1]

Core Viewpoint - The official announcement of the Hainan Free Trade Port's full island closure operation starting December 18, 2025, marks a significant step in China's high-level opening-up strategy, showcasing the country's commitment to expanding its economic openness [1] Group 1: Policy Framework - The Hainan Free Trade Port will implement a policy system characterized by "one line open, two lines controlled, and island-wide freedom," which aims to create a more open economic system and serve as a testing ground for national reform and opening-up [1] - The "one line open" approach will feature zero tariffs for goods entering from outside China, while the "two lines controlled" mechanism will ensure precise management of goods entering the mainland to protect local markets [1] - The "island-wide freedom" policy allows for relatively free circulation of various factors within the island, enabling tax exemptions on imported goods traded among local enterprises [1] Group 2: Economic Impact - The zero-tariff negative list management covering 74% of product categories will facilitate low-cost global factor aggregation in Hainan, enhancing the inflow of global resources [2] - The policy allows for the free flow of people, logistics, capital, and data, with 85 countries' citizens enjoying visa-free entry and cross-border capital transfers being unrestricted [2] - The processing and value-added policies will enable Hainan to become a global processing hub, allowing for the transformation of raw materials into high-value products within a closed environment [2] Group 3: Trade and Investment Facilitation - The "two lines controlled" mechanism will categorize and regulate goods entering the mainland, allowing products with over 30% value-added to enter without import duties [3] - Hainan's strategic location as an RCEP hub will facilitate the processing of Southeast Asian raw materials for export to markets like Japan and South Korea, leveraging RCEP's preferential rules [4] - The establishment of a multi-functional free trade account system will support cross-border asset management, data flow, and RMB settlement, creating new channels for foreign trade and investment [4]

Core Viewpoint - The Hainan Free Trade Port will officially start its full island closure operation on December 18, 2025, marking a significant step in China's high-level opening-up strategy and showcasing the country's commitment to expanding its openness to the world [1] Group 1: Policy Framework - The operational framework of the Hainan Free Trade Port is characterized by a policy system of "one line open, two lines controlled, and island-wide freedom," which aims to provide a "testing ground" for a more open economic system in China [1] - The "one line open" policy will implement a series of zero-tariff measures for goods entering from outside China, while the "two lines controlled" policy will ensure precise management of goods entering the mainland to protect the local market [1] - The "island-wide freedom" policy allows for relatively free circulation of various factors within the island, enabling enterprises to trade zero-tariff goods without import taxes [1] Group 2: Economic Impact - The zero-tariff and processing value-added model will effectively enhance the quality and efficiency of foreign trade and investment in China, facilitating low-cost aggregation of global factors within the island [2] - The implementation of zero-tariff negative list management, covering 74% of product categories, will attract global factors to Hainan, with eight "one line" ports allowing eligible goods to be released [2] - The "island-wide freedom" circulation rules will create an efficient environment for value enhancement, allowing zero-tariff imported goods and their processed products to circulate freely among enterprises on the island [2] Group 3: Strategic Advantages - The "two lines controlled" mechanism will enable precise output of value-added goods and services from the island to the mainland, with customs implementing batch exports and centralized declarations for zero-tariff goods [3] - Hainan's geographical advantage as an RCEP hub will facilitate deep processing of raw materials from ASEAN countries, allowing for exports to Japan and South Korea while benefiting from RCEP origin rules [3] - The full island closure will open new channels for foreign trade and investment, supporting the construction of a new dual circulation development pattern in China [3]

Group 1 - The policy of "one line open, two lines controlled, and free within the island" will be officially implemented, significantly increasing the proportion of imported "zero tariff" goods from 21% to 74%, enhancing trade freedom between Hainan and foreign countries while maintaining efficient connectivity with the mainland [1] - Xingtong Co., Ltd. has proactively established a wholly-owned subsidiary, Xingtong Shipping (Hainan) Co., Ltd., in June 2022, with a registered capital of 250 million RMB, to capitalize on the Hainan Free Trade Port policy [1] - Xingtong Shipping (Hainan) primarily engages in international bulk liquid hazardous goods transportation and has established 10 wholly-owned subsidiaries in Singapore and Hong Kong, with a total registered capital of approximately 160 million RMB, forming a global operational network [1][2] Group 2 - Currently, Xingtong Shipping (Hainan) and its subsidiaries operate 8 chemical tankers with a total deadweight tonnage of 130,600 tons and a total investment of about 1.3 billion RMB, focusing on international liquid chemical transportation across various regions [2] - The company has established stable partnerships with key local enterprises in Hainan, such as China National Offshore Oil Corporation and Yisheng Dahu Chemical Co., Ltd., which lays a solid foundation for business expansion post-closure [2] - With the upcoming closure operation of Hainan Free Trade Port, the company anticipates increased shipping demand due to more international trade and investment, and plans to leverage its platform to enhance profitability and market share in the international shipping sector [2]

Report Summary 1. Report Industry Investment Rating - No information provided on the industry investment rating [N/A] 2. Core View of the Report - The stock indices closed higher today. The CSI 500 and CSI 1000 indices, after yesterday's adjustment, were relatively strong and hit new highs for the year. The trading volume in the two markets decreased slightly but remained at a relatively high level for the year. Affected by the news that Hainan Free Trade Port will start the full - island customs closure operation on December 18 this year, related concept sectors such as free trade zones and duty - free shops led the gains. In terms of futures basis, the basis of each variety contract increased today, and the open interest also increased, indicating that bulls entered the market. With the current news being relatively calm and the market sentiment remaining optimistic, it is expected that the stock indices will continue to operate strongly [6] 3. Summary by Relevant Catalogs Market Review - The stock indices closed higher today. Taking the CSI 300 index as an example, it closed up. In terms of capital, the trading volume in the two markets decreased by 1.9894 billion yuan. The stock index futures all rose with increased volume [4] Important Information - Approved by the Party Central Committee, Hainan Free Trade Port will start the full - island customs closure operation on December 18 this year. A series of policy measures will be implemented on the day of the full - island customs closure. Among them, the proportion of the tax items of "zero - tariff" goods imported from the "first line" will be increased from 21% to 74%. These goods can circulate within the island among beneficiaries without import tax, and those with a processing value - added of 30% can be sold to the Chinese mainland duty - free [5] Strategy Recommendation - Hold long positions and wait and see [7] Futures Market Observation | | IF | IH | IC | IM | | --- | --- | --- | --- | --- | | Main contract intraday change (%) | 0.76 | 0.50 | 1.72 | 1.84 | | Trading volume (10,000 lots) | 11.4133 | 5.3842 | 9.5468 | 20.5106 | | Trading volume change compared to the previous day (10,000 lots) | - 1.6976 | - 1.3034 | - 0.9753 | - 0.6634 | | Open interest (10,000 lots) | 27.1368 | 10.0891 | 22.9789 | 33.8313 | | Open interest change compared to the previous day (10,000 lots) | 0.2311 | 0.0135 | 0.1553 | 0.0035 | [7] Spot Market Observation | Name | Value | | --- | --- | | Shanghai Composite Index change (%) | 0.65 | | Shenzhen Component Index change (%) | 1.21 | | Ratio of rising to falling stocks | 4.80 | | Trading volume in the two markets (100 million yuan) | 18447.06 | | Trading volume change compared to the previous day (100 million yuan) | - 198.94 | [8]

Core Viewpoint - The official announcement of the full closure operation of Hainan Free Trade Port is set for December 18, 2025, marking a new phase in the port's development and a long-term task for continuous advancement [1][2]. Group 1: Full Closure Operation - The full closure operation is a significant milestone in the construction of Hainan Free Trade Port, aimed at further expanding openness and enhancing international connections [2]. - The closure will establish Hainan Island as a special customs supervision area, implementing a policy characterized by "one line open, one line controlled, and free flow within the island" [2][3]. - The closure is expected to facilitate the attraction of global quality resources and promote high-quality development of Hainan Free Trade Port [2]. Group 2: Policy Measures - The implementation of a more favorable "zero tariff" policy will increase the proportion of zero-tariff goods from 21% to 74% for imports from the "one line" [3]. - Trade management measures will be relaxed, allowing for open arrangements for certain previously prohibited or restricted imports [3]. - More convenient passage measures will be established, including the use of eight open ports as "one line" ports and ten "two line" ports for innovative passage measures [3]. Group 3: Trade Management and Transparency - The introduction of a "prohibited and restricted import and export goods list" aims to enhance the transparency of trade management [4][5]. - The list will allow for the relaxation of management measures on certain imported goods, significantly increasing the openness of trade [5]. - The list will also facilitate the import of old mechanical and electrical products, covering about 80% of those previously under import license management [5]. Group 4: Future Development Directions - The National Development and Reform Commission will continue to improve the policy system in line with high-level free trade port standards, focusing on trade management, investment environment, and financial policies [6][7]. - Measures will include expanding the range of zero-tariff goods, enhancing the investment environment, and establishing a more open shipping system [6][7]. - The development of a cross-border data flow mechanism will be prioritized, promoting the growth of the digital economy [7].