HAIKOU /China/, December 25. /TASS/. China's southern province of Hainan has achieved notable results in attracting and utilizing foreign capital in recent years, the Hainan Daily newspaper reported.

The paper noted that Hainan has steadily promoted the construction of a free trade port, expanded openness and paid special attention to attracting foreign capital.

According to statistics, the amount of allocated foreign capital in Hainan increased steadily from 2018 to 2020. Between 2021 and 2022, Hainan ranked among China's top 10 regions with the highest volume of allocated foreign capital, the newspaper said. This year, it is also showing positive dynamics.

The article points out that 1,320 enterprises with foreign capital were established on the island in 2022. The volume of allocated foreign investment in the province at the end of last year amounted to $4.05 billion, which is 15% higher than in 2021. Meanwhile, 1,227 foreign-invested enterprises were established in Hainan in January-September 2023, up 19.5% year-on-year. The amount of allocated foreign capital reached 16.33 billion yuan (about $2.3 billion), up 8.5% year-on-year.

The newspaper said the structure of foreign capital in the province is constantly improving, with the proportion of foreign investment in the service sector increasing. Many enterprises have become well-developed. They are conducting business, boosting consumption and promoting the development of Hainan Free Trade Port, the paper said.

Free Trade Port

"Hainan Daily notes that foreign-invested enterprises are optimistic about the development prospects of the Hainan Free Trade Port. Further infrastructure development is expected to help attract even more investment from overseas.

The province is working to continuously improve the business environment as well as the regulatory framework. As the publication notes, many companies are entering the Hainan market thanks in part to the preferences of the free trade port, including tax incentives. Favorable conditions of the free trade port allow businesses to reduce production costs. In addition, Hainan can become a starting point for enterprises to enter new markets, as well as further development in the mainland Chinese market, the publication said.

On June 1, 2020, the Central Committee of the Communist Party of China and the State Council of China published a program for the formation of a free trade port in Hainan. The document provides for the creation of a special customs zone on this tropical island. The authorities of China plan to complete the construction of a free port on the territory of the province in 2025, when the island should be built a system of free trade and investment. By 2035, Hainan plans to ensure freedom of trade and investment, cross-border capital movement, travel and cargo transportation.