China accelerates mega free trade project in Hainan, the province hosting the 'Asian Davos' this week.
By the end of this year, an island located at the southern tip of the Asian giant will implement a special customs regime. This topic is a highlight of the Boao Forum 2025.
By Guilherme Paladino, from Hainan (China), for 247 - While the West debates trade barriers, an important phenomenon is occurring in the southernmost province of China, Hainan, known as "The Hawaii of the Asian giant"Since 2020, the Central Committee of the Communist Party of China and the State Council have entrusted the province with what they call... "historic mission": to transform the island into one of the world's largest free trade ports (FTP).
With an area of 35.400 km² and a tropical climate, Hainan is not only a well-known tourist destination in China for its beaches and forests, but also a laboratory for new economic policies of the "Reform and Opening Up" era. By the end of 2025, the island will finalize the first phase of implementing a special customs regime, allowing the free movement of goods between Hainan and overseas, while maintaining normal controls on trade with mainland China.
Although trade liberalization measures in the region are recent – the first ones have been implemented over the last five years – the impact is already beginning to be felt. In 2024, the total value of imports and exports reached 277,65 billion yuan, representing an annual growth of 20%. During the same period, the province's GDP reached 793,5 billion yuan and tourism generated 204 billion yuan.
The province aims to develop, primarily, four pillar industries: tourism, modern services, high technology, and tropical agriculture.
One of the driving forces behind the transformation is the Boao Forum for Asia, whose 2025 edition began this Tuesday (25) — and in which Hainan displays its global ambitions.
Boao Forum 2025
Political and business leaders are meeting this week in Boao, a coastal city in Hainan, for the 2025 edition of the 'Boao Forum for Asia' – also known as the 'Asian Davos'. This year's theme is... "Asia in a Changing World: Towards a Shared Future".
The event began today with the Sub-forum "Global Development of Free Trade Ports," organized by the Hainan government. Here, authorities discussed how free trade zones are becoming important for Asian integration, especially with the RCEP (the world's largest trade agreement, which includes China, Japan, and ASEAN).
"My colleagues and I have seen with our own eyes how the province has transformed and reinvented itself. From infrastructure and services to high-tech industries, Hainan is on its way to becoming a magnet for resources and people," said Ban Ki-moon, current president of the Boao Forum for Asia, in his opening speech. The South Korean opened Tuesday's sub-forum on free trade ports, focusing on "Boosting Global Economic and Trade Cooperation."
The case of the Hainan Aircraft Maintenance Base
As an example of the transformations in Hainan with its recent shift towards economic openness, the Free Trade Port Aircraft Maintenance Industrial Base stands out. Located in Haikou (the province's capital), the facility is a mega-complex with paint hangars, parts workshops, and even an international trade center for aircraft components.
Existing in the region since 2000, at the time serving only as a hangar. For inspection and review for Hainan Airlines, the base had already undergone several evolutions over time, but its 'big leap' only came after 2022 – already within the context of the new planning for the region. At the beginning of its operations, the base's built area was 9.000m². In 2008, a new hangar was built for China Southern Airlines, with 6.000m². In 2014, another hangar was built for Hainan Airlines, this time with a built area of 32.000m².
However, in 2022, the Hainan Free Trade Port Integrated Aeronautical Maintenance Base began operating, with 148.000 m² of built area and a structure capable of repairing the entire supply chain of the sector. In 2023, the Aeronautical Engine Maintenance Base was also built, with a constructed area of 48.000 m².
Since 2022, the base has already accomplished:
- Maintenance on 1.862 aircraft;
- Repair of 44.000 parts;
- Painting of 212 aircraft (including Qatar Airways jets during the 2022 World Cup).
"Before, we only did simple repairs. Now, we are a complete chain," explained Wang Haiye, the base director, during a visit from... 247 to the location. "Thanks to free trade policies, our services are 10 to 15% cheaper than elsewhere.
The base holds 23 international certifications, including from the FAA (USA) and EASA (Europe), and has already saved 80 million yuan in taxes through its policy of... "zero fare" for importing equipment. By 2028, it will be the 4th largest in the world in the maintenance of GEnx-1B engines (used in Boeing 787s).
The privileged location also helps: in a 4-hour flight, the base covers 21 countries and regions, encompassing 47% of the world's population. In 8 hours, it covers 59 countries and 67% of the global population.
For Chinese businesspeople, Hainan is no longer just the beaches that families typically visit on vacation.. "We are an important connecting hub focused on the Pacific and Indian Oceans.""Wang summarizes."
