HAIKOU, November 28. /TASS/. Starting in December 2025, the southern Chinese province of Hainan will become a special economic and customs zone, which will benefit companies from Russia, Asia, Africa, and Latin America by allowing them to reduce their tax costs by 20% and obtain unique conditions for entering the vast Chinese market, the ChinaNews outlet reported.
According to officials, businesses will benefit from special tax regimes, including zero duties and low tax rates. The so-called customs closure of the free trade port is planned for December 18, which will transform the province into a separate, isolated customs zone with duty-free movement of goods. This is a key step in creating one of China's most ambitious projects, which will open up unique opportunities for businesses in the Global South, including those in Russia, Kazakhstan, India, Brazil, and elsewhere.
After the "customs closure of the island," the list of goods imported without customs duties will grow from 1,900 to 6,637 items. Importantly, import duties, value-added tax, and excise duties will be abolished. Together, these tax reductions could lower the cost of importing raw materials and equipment by about 20%, compared to the standard procedure for importing to China.
Companies that register in Hainan will enjoy a preferential income tax rate of 15%, rather than the standard 25% rate in China. Highly qualified specialists working for these companies can also pay income tax at a rate of up to 15% instead of 45%.
For example, a textile company in Hainan can import Egyptian flax fiber duty-free, produce fabrics from it, and export them to mainland China duty-free once they have undergone 30% processing. The company and its employees will enjoy all tax benefits at the same time.
Thus, Hainan is positioning itself not just as a resort region, but also as a new global hub for trade and investment. It offers businesses from developing countries an effective and profitable way to integrate into the Chinese economy.