China’s southernmost province of Hainan is getting a package of favorable policies covering tourism, duty-free shopping and medical services that’s designed to help transform the island into an international tourism destination.
Hainan, often billed as China’s Hawaii, will become a “free trade port,” China National Radio reported Friday. The upgraded status is an economic distinction that’s aimed to help boost the region’s economy.
China is seeking a breakthrough in Hainan’s opening and welcomes global investors to the island, according to the report, which cited a speech by President Xi Jinping. Hainan will set up a trial free-trade zone and will prioritize tourism, medical services and the financial sector, according to the report. Hainan will also adopt more open duty-free shopping policies, and international flight routes will be increased, it said.
The plan is aimed to boost domestic and foreign tourists to Hainan, where entrepreneurs and real estate developers have been pouring in billions of dollars to build resorts and shopping centers that have stayed mostly empty despite its sandy, white beaches. The news is expected to be a boon for the economy of the province, which is countering a fiscal deficit amid the debt woes of HNA Group Co., its biggest conglomerate that’s facing pressure from creditors after a global expansion.
About 67 million tourists visited Hainan last year, helping to grow its tourism industry to 81 billion yuan ($13 billion). Still, only about 1.1 million were overseas visitors, which pales in comparison to Asia’s tourism destinations in Vietnam and Thailand.
More tourism to the island could be good news for HNA Group, whose businesses span aviation to hospitality. The conglomerate’s under pressure to shore up its finances after it spent tens of billions of dollars to snap up trophy assets around the globe.
In February, Bloomberg reported that government agencies under a party reform group headed by Xi are considering proposals to support the island, including allowing online gaming or a lottery. The gaming proposals could open the door to physical casinos, which are currently banned on the mainland.
Xi attended the Boao Forum for Asia in Hainan this week, which brought world leaders to the island. At the forum, the Chinese leader reiterated pledges to open sectors from banking to auto manufacturing, and warned against “Cold War mentality” amid trade disputes with U.S. counterpart Donald Trump.
©2018 Bloomberg L.P.
This article was written by Daniela Wei from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.
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