Core Viewpoint - The Hainan Free Trade Port will officially start its closed operation on December 18, 2025, marking a significant milestone in China's efforts to expand its openness and implement liberalization policies [1] Group 1: Policy Implementation - The closed operation will feature a policy framework characterized by "one line" for openness, "two lines" for management, and free flow within the island [1] - The "zero tariff" policy for imported goods will increase from 21% to 74% of the tax categories, allowing for tax-free circulation among eligible entities within the island [2] - Trade management measures will be relaxed, allowing for open arrangements for certain previously restricted imports [2] - Ten "second-line" ports will be established to facilitate the passage of goods into the mainland, enhancing efficiency [2] - A precise regulatory model will be implemented to ensure low intervention and high efficiency for "zero tariff" goods [2] Group 2: Economic Development - The closed operation is expected to attract global resources and promote the development of key industries such as tourism, modern services, high-tech industries, and tropical agriculture [3] - The initiative aims to create a modern industrial system with unique advantages for Hainan, focusing on enhancing productivity and innovation [3] - The government plans to expand the scope of the "zero tariff" policy significantly, increasing the number of tax categories from 1,900 to approximately 6,600, covering 74% of all goods [4] - The policy will allow for free circulation of "zero tariff" goods among various entities, enhancing the competitiveness of local industries [4]

Core Viewpoint - The establishment of the Hainan Free Trade Port (FTP) is a significant milestone in China's efforts to expand its openness and facilitate trade, with a focus on implementing a "one line open, two lines controlled, and free flow within the island" policy [2][7]. Policy Framework - The Hainan FTP has initially established a policy system that allows visa-free entry for personnel from 85 countries [3]. - The official launch date for the full island closure operation is set for December 18, 2025 [4]. Current Measures - The current closure policy measures can be summarized as "four more" enhancements: 1. More favorable "zero tariff" policies, increasing the proportion of zero-tariff goods from 21% to 74% [5]. 2. More relaxed trade management measures, allowing for open arrangements for previously restricted imports [5]. 3. More convenient passage measures through designated ports [5]. 4. More efficient and precise regulatory models for zero-tariff goods [6]. Trade and Investment - After the closure, there will be a significant increase in the coverage of zero-tariff goods, expanding from approximately 1,900 to about 6,600 tax items, which represents a 53 percentage point increase [10]. - The Ministry of Finance will continue to deepen tax reforms to ensure sustained policy benefits, including adjustments to the import tax item catalog and optimizing duty-free shopping policies [11][12]. Market Access - New measures will be introduced to further relax market access, particularly in service trade, and to create a transparent investment environment [9][15]. - The customs authority will simplify the declaration process for goods leaving the island, reducing the number of required declaration items from 105 to 42 [18]. Economic Performance - Over the past five years, Hainan has attracted a total of 102.5 billion yuan in foreign investment, with an annual growth rate of 14.6% [21].