Hainan Free Trade Port key to modern industrial system

Source:China Daily

The construction site of the ongoing Haikou International Duty Free City project is seen in Hainan province in March. The project covers a planned area of more than 920,000 square meters. [Photo/China News Service]

Green tech, advanced tourist facilities essential to island province's development

With China expanding many programs to build a modern industrial system that focuses on tourism, high-tech and modern services industries at Hainan Free Trade Port, the country's centrally administrated State-owned enterprises have been rushing to enlarge their market presence at the port this year, said executives.

Three central SOEs from the energy and manufacturing sectors-namely China Datang Corp Ltd, Dongfang Electric Corp Ltd and Power Construction Corp of China-began to build the Hainan Yangpu Offshore Wind Power Industrial Park in Hainan FTP in late April.

The project mainly includes the investment and development of high-end industries such as offshore wind power, hydrogen energy and marine pastures. With a total investment of 4.8 billion yuan ($721.4 million) and a total area of about 70.7 hectares, the industrial park will build an offshore wind power equipment base with an annual output of over 1 million kilowatts.

"The industrial park is expected to create more than 3,000 jobs for locals. Our company will also launch offshore wind power projects with a total investment of over 18 billion yuan," said Zhang Xinyu, deputy director of the offshore wind preparatory department of Datang Hainan Energy Development Co Ltd, a subsidiary of Beijing-based China Datang.

Its annual revenue is expected to reach 12.4 billion yuan, and annual taxes are forecast to be 550 million yuan, after the project is completed and put into operation.

According to the schedule, the first wind turbine of the project is expected to roll off the production line in June 2023, and the project is set to be put into operation in June 2024.

"We plan to invest another 30 billion yuan in energy development in Hainan FTP in the coming years," said Jia Bingjun, chairman of the Datang Hainan Energy Development Co Ltd. "In addition to gas power, we also aim to promote the development of offshore wind power, photovoltaic power as well as hydrogen energy."

Jia said the company has set goals of achieving a total installed capacity of over 5 million kW and becoming the largest green energy supplier in Hainan by the end of the 14th Five-Year Plan period (2021-25).

China unveiled a master plan in June 2020 to build the island of Hainan into a free trade port with Chinese characteristics and global influence by the middle of the century.

The master plan said the Hainan FTP is set to introduce island-wide Customs clearance operations by 2025, as part of broader measures to promote trade and investment liberalization and facilitation.

China Tourism Group, the parent company of China Duty Free Group, or CDFG, the country's largest operator of duty-free stores, will put its vast Haikou International Duty Free City project, with a planned construction area of more than 920,000 square meters, into operation in the second half, thanks to favorable government policies to stimulate domestic consumption and support the growth of Hainan FTP.

The central SOE has invested more than 10 billion yuan in the large-scale duty-free and tourism complex building cluster project that features functions of duty-free and dutiable commercial services as well as high-end office and hotel space.

Once operational, the company will have more than 10,000 employees working in Hainan.

The company highly values its business development in the region and is making full use of the geological resource and policy advantages of Hainan FTP, said CDFG President Chen Guoqiang.

To further diversify its business and mitigate the impact brought by the COVID-19 pandemic, CDFG developed new tourism packages in which activities such as surfing, deep-sea fishing and satellite-launch watching are included. Adding the digital platform's contribution, the company had a year-on-year operating revenue growth of 96 percent in the travel business segment in 2021.

Supported by a friendly and fast-growing business environment, Hainan recorded total foreign investment inflows of over $3.52 billion in actual use, up 16.2 percent on a yearly basis in 2021, while 1,936 foreign-funded enterprises were newly established in the province, soaring 92.6 percent year-on-year, according to data released by the provincial commerce department.

By the end of 2021, central SOEs, including China Railway Engineering Corp Ltd, China Huaneng Group Co Ltd and China COSCO Shipping Corp Ltd, have set up more than 500 subsidiaries as well as research and development facilities in Hainan, and their total assets exceeded 650 billion yuan.

Hainan FTP has been making solid efforts to reinforce the strategic functions of the free trade port entrusted by the country, serving as a new services and transportation hub in attracting and allocating global resources, and becoming a key intersection of the dual-circulation growth paradigm, said Wei Xiaoquan, a researcher specializing in regional economic development at the University of International Business and Economics in Beijing.

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