Malaysian durian exhibitors serve customers at the fourth China International Consumer Products Expo on April 16, 2024.Photo: Qi Xijia/GT

At the fourth China International Consumer Products Expo (CICPE) held in Haikou, South China's Hainan Province, the booth of a Malaysian durian exhibitor looked very busy, with dozens of visitors eager to place orders for the popular Musang King durian cultivar.

"Our products are extremely popular with the visitors. I brought 4,000 kilograms of durian to the expo and have already sold one-third of them in the first few days. The purchasing power in China is truly impressive," Ng Chin Heng, owner of the durian trading company, told the Global Times.

Prior to the expo, Ng registered a company through the Hainan Free Trade Port (FTP) to process durian-related products, attracted by the opportunities created by the port. Ng's success serves as a vivid example of how Hainan has become a hub of trade between China and Belt and Road Initiative (BRI) partner countries, as well as a magnet attracting foreign investment.

Running from April 13 to Thursday, the expo themed "Share open opportunities, co-create a better life" attracted many enterprises from BRI partner countries to attend. In particular, the expo has attracted companies from Southeast Asian economies such as Malaysia, Thailand, Vietnam and Singapore to attend the expo, eyeing China's growing consumer market. 

A 'springboard' to China

Ng is attending the exhibition as part of the booth of Malaysia PROMAS International Business Society. The chamber has brought 12 companies to the CICPE with a floor area of 168 square meters, including food, coffee, durian, healthcare products, and slippers. "This is our first time attending the CICPE. We feel that our products are really welcomed here," Fan Shu Hua, Assistant President of Malaysia PROMAS International Business Society, told the Global Times.

Fan said that Malaysian companies are interested in the opportunities presented by the Hainan FTP, and the chamber has been organizing business tours to Hainan Province to learn more about the market.

"For us, Hainan is a really good springboard to tap into the massive Chinese market. It is a popular tourism destination and the FTP exempts import tariffs. Through this expo, many of our businesses are seeking dealers to bring our products to China. Some companies are even considering direct investment in Hainan," Fan said. 

The Thai Hainanese Trade Association has brought nine companies to attend this year's CICPE, showcasing pillows, cosmetics, and local medicine. 

"It is our first time being at the expo. The feedback exceeds our expectations. Through this platform, we hope to bring more Thai brands to the Chinese market," Kraitheerawut Wirot, President of the Thai Hainanese Trade Association, told the Global Times.

He noted that the Thai businesses are eager to invest in Hainan thanks to the close geographical distance with only a two-hour flight between them, and the province's favorable policies to attract foreign investment.

The construction of the Hainan FTP, the increase in direct flights, and visa exemptions are adding extra convenience, according to the BRI exhibitors.

"We feel that it is increasingly convenient due to mutual visa exemption policies and the availability of direct flights. When we need to sign a contract, we can fly to China immediately," Fan said.

Due to its regional advantage, a four-hour flight from Hainan can cover 21 Asian countries and regions, which account for 47 percent of the world's population and 30 percent of the world's GDP, according to a Hainan FTP Investment Policies Guide issued by the Department of Commerce of Hainan Province.

The Hainan FTP is also offering a favorable tax management system, including zero tariff for certain imported goods, low tax rates for companies operating the FTP and qualified individuals, as well as a simplified tax system, accordiong to an investment policy guide of the province. 

Visitors visit a Thai booth at the fourth China International Consumer Products Expo on April 16, 2024. Photo: Qi Xijia/GT

Dividends of opening-up

Many BRI exhibitors said they are looking forward to the potential of the Hainan FTP as Hainan transforms into a world-class free trade hub, with an independent customs regime set to be in place by the end of 2025.

By then, Hainan will become the largest free trade port in the world, and foreign enterprises will be able to integrate into China's market more conveniently and efficiently, according to Thai enterprise TCP Group, which is a four-time CICPE participant.

"This has boosted the confidence of many foreign enterprises, like TCP Group, to develop and expand in China," the group said.

Singapore-based wellness tech brand OSIM told the Global Times that with Hainan accelerating the advancement of institutional opening-up and optimization of the business environment, the advantages of the FTP are increasingly amplified now.

"We believe that more and more Southeast Asian companies will start from Hainan and expand their cooperation in China, providing better products and services for domestic consumers," OSIM said. 

With the independent customs regime, there will be an increasing number of imported goods entering Hainan with zero tariffs in the future, providing consumers with more affordable options. The level of openness in the service trade sector will continue to thrive, and market access for foreign investment in sectors such as health care, education, and telecommunications will be further relaxed, Chinese officials said.

By introducing more favorable tax policies, relaxing market access, and optimizing the business environment, the Hainan FTP has successfully attracted more foreign investment, especially in high-tech, green energy, and modern services sectors, further promoting economic structural optimization and industrial upgrading of the province, EY said in a research paper sent to the Global Times.

The vitality of Hainan FTP is being progressively unleashed. In the first quarter of 2024, Hainan's trade totaled 64.23 billion yuan ($8.87 billion), a yearly increase of 11.3 percent, marking the first time for its quarterly export to exceed 60 billion yuan.  Its trade with the BRI partner countries recorded an annual increase of 28.5 percent to reach 34.12 billion yuan in the quarter.

In 2023, the actual use of foreign capital and foreign direct investment in Hainan reached 22.71 billion yuan, while the cross-border yuan payments exceeded 300 billion yuan, rising 120 percent year-on-year.