SANYA, July 2. /TASS/. The annual duty free festival in the southern Chinese province of Hainan will officially kick off on July 6, reported the Sanya administration on social network Weibo.
In particular, in Sanya's duty free zone, marketing campaigns will be held from July to September. According to plans of the local authorities, the duty free festival should attract an even greater flow of tourists to shop on this tropical island.
Ahead of the festival, the Chinese government has taken a number of measures to liberalize the Hainan duty free program. Thus, starting from July 1, the island has a new quota of 100,000 yuan (approximately $ 14,140) for duty free shopping. In addition, the authorities lifted the limit on the maximum price per purchase, which used to be 8,000 yuan, and expanded the list of categories of consumer goods sold without duty from 38 to 45.
According to the Sanya city administration, consumer duty free activity was observed on the very first day the new duty free trade rules came into force: there was a line in front of the store at 8 o’clock in the morning, and it opened only at 10 o’clock. Visitors were allowed inside, subject to the necessary safety measures, and temperature was measured before entering.
On April 20, 2011, the Chinese State Council approved the launch of a pilot program for the development of a chain of duty free shops on Hainan to promote the island as a world-class resort.The customers can purchase perfumes, cosmetics, jewelry, watches, bags, etc. The Chinese government has gradually lifted trade restrictions at local duty free shops. In 2018, the authorities have already increased the maximum amount of purchases in these stores from 16,000 to 30,000 yuan (from $ 2,300 to $ 4,500).
New duty free categories
Among the new categories of duty free products on Hainan are alcohol, natural honey, tea, tablets and minicomputers, smartphones, game consoles, and other electronic gadgets and accessories.
“The electronic products that have just appeared on the shelves are very popular,” the Sanya city administration said. “There are more than 20 brands of high-end alcohol on sale, among them the most expensive bottle of Louis XIII cognac which costs 51,900 yuan (about $ 7,300), and that is by 7-8,000 yuan ($ 1-1,300) cheaper than the market price".
Moreover, one can now purchase the popular Apple products. Thus, for example, the flagship iPhone 11 Pro Max with 512 GB RAM in Hainan's duty free costs about 10,200 yuan (about $ 1,400), while on the official Apple website customers will have to pay no less than 12,600 yuan (about $ 1,800). Thus, the buyer can save about 20%. The cheapest smartphone of the same line in the Sanya duty free store is 128 GB iPhone 11 Pro, it will cost Hainan guests 5,100 yuan (about $ 720) and save them about 900 yuan (about $ 140).
At the same time, the volume of alcoholic beverages purchased by one person should not exceed 1.5 liters, and the number of purchased smartphones should not exceed four. The restrictions also apply to the purchase of cosmetics, which was on the list of duty free goods before its expansion. However, now buyers can purchase up to 30 cosmetic products without paying a fee, before this amount was limited to 12 units of products. All other products are not subject to quantitative restrictions.
Sales increase in duty free zones
Four duty free shops are currently open on Hainan: two of them are located in the provincial capital, Haikou, the rest — in Sanya and the coastal town of Boao. According to the latest data, their sales in May amounted to more than 1.9 billion yuan (about $ 279 million), which is by 141% more compared to the same period last year.
Over the recent years, Hainan's duty free zones have shown solid revenue growth. Thus, in 2018, sales in duty free shops on Hainan reached 10.1 billion yuan (about $ 1.47 billion), which is about 26% of the corresponding national figure. Last year, sales grew by more than 34%, to 13.61 billion yuan ($ 1.97 billion).
According to the data from the Haikou Customs Administration, the total sales of Hainan's duty free shops over nine years exceeded 55 billion yuan (about $ 7.78 billion).
Earlier, the Central Committee of the Communist Party of China and the Сhinese State Council published the “General Program for the Establishment of a Free Port on Hainan,” according to which the island’s administration intends to create an effective system to fulfill a number of important social and economic goals by 2025, and within 10 years to decisively enhance the innovative mechanisms for the region's development.
In April 2018, President Xi Jinping said that the Chinese authorities intend to actively involve Hainan in globalization and to draw foreign investors to the island province. By 2050, according to the authorities, the island should become a unique international cluster with an advanced economy, developed tourism, top-notch scientific, technical and financial potential, and modern medicine. The branches of the best universities and offices of the most powerful corporations in the world will be located on the Island of Hainan.