Editorial | Hong Kong can benefit from plan by Hainan to be giant free-trade port
- Hainan’s proximity to city means both economies can complement each other, as businesses on the island may utilise Hong Kong’s expertise in legal and financial services
As Hong Kong evolves to become more like a premier mainland city, Hainan is set to become more like Hong Kong. A multi-year plan is afoot to transform the 35,000 sq km (14,000 square-mile) island at the southernmost tip of the country into the world’s largest free-trade port with low taxes and more relaxed visa conditions to match.
The plan is likely to complement rather than challenge Hong Kong as a financial hub. The city’s incoming administration will be wise to study the plan in depth and prepare to take advantage when opportunities present themselves in the years ahead.
The Hainan project has been years in the making, as the strategically located island aims to catch up with the economic powerhouse of Guangdong, particularly the Greater Bay Area.
It hopes to lure both foreign and domestic investors, businesses and tourists to contribute to national consumerism, which is part of the so-called dual circulation strategy to diversify from external or foreign trade and investment for economic growth.
06:19
High hopes for China’s Greater Bay Area, but integrating 11 cities will pose challenges
It will serve as a bridge to the Asean countries, which collectively have overtaken the European Union as China’s biggest trade partner. By 2025, Hainan is expected to have secondary borders with their own checkpoints for free trade and duty-free purchases, in short, an independent customs regime. The goal is to replicate Shenzhen’s successes in experimenting with new projects and ideas of its own.