Page 330 - 2022 White Paper on the Business Environment in China
P. 330
2 White Paper on the Business Environment in China
Background free shopping policies have sparked remarkable
enthusiasm among consumers. According to
Consumer goods are expected to continue to the master plan, China will build Hainan into a
grow in China in the foreseeable future. China globally influential and high-level free trade port
has proposed a 5% average annual growth rate by the middle of the century. Feng Fei, governor of
for the total retail sales of consumer goods during Hainan, said duty-free sales networks around the
its 14th Five-Year Plan period (2021-25), said the island will be expanded to better meet domestic
Ministry of Commerce. As the total retail sales demand for imported goods during the 14th Five-
of consumer goods have shown a steady and Year Plan period (2021-25), with sales of duty-free
slow development trend in recent years, service- goods expected to reach 300 billion RMB during
based consumption will continue to grow, and 2021 to 2025. Hainan has sold about 98 billion
its proportion will become larger in the country's RMB of duty-free goods from 2011 to 2021. During
household consumption in the next stage, said that time, more than 25 million people shopped,
Zhu Xiaoliang, director-general of the department and about 120 million items were sold, according
of market operation and consumption promotion to official statistics. With the new shopping policy
at the Ministry of Commerce. With people's living giving tremendous impetus to overseas brands,
standards continuing to improve, the nation's the Hainan FTP will likely become the world's
consumption trend has upgraded from purchasing biggest duty-free market in the near future if
goods to service consumption, and the share of the growth momentum continues, according
service Consumption is getting higher. Service to a report jointly released by KPMG China
consumption accounted for 52.5% of China's and the Moodie Davitt Report at the first China
household consumption in the first half of 2021, International Consumer Products Expo, which was
data from the ministry showed (Nan). held in Haikou in May of 2021 (Wenqian, “Policies
Help Fuel Duty-Free Hub Hopes”).
Increase in Duty Free Shopping
Chinese residents have opted for new ways
Throughout 2021, the duty-free shopping to celebrate 2021’s National Day holiday amid
boom has continued to pick up momentum in the COVID-19 prevention and control efforts, further
Hainan province as fine-tuned national policies stimulating the economy. Between 2020 and
turn the resort island into a duty-free shopping 2021, new consumption patterns in the shopping,
hub, officials and experts said. Offshore duty- tourism and culture sectors that have emerged
free sales reaped 46.8 billion RMB ($7.2 billion) during the holiday show that consumer demand
in the 12 months to June 30 in Hainan, surging has diversified. Both online and offline shopping
226 % year-on-year. The nine duty-free shops in have gained steam during the National Day
Hainan received a total of more than 6.28 million holiday, with sales in the “consumption-upgrade”
customers, a year-on-year increase of 102%, sector soaring. This was due in no small part to
and sold more than 60 million duty-free items, duty free sales areas such as south China’s island
up 211%. Customers spent most of their money province of Hainan. Consumers are attracted to
on cosmetics, watches and jewelry, according to the province by the variety of products available
customs officials. Hainan introduced mail delivery at friendly prices. Tax-free shopping sales on the
services for tourists to the island in early February, first day of the weeklong holiday reached 171
in addition to the original option of airport pickup million RMB (about 26.37 million U.S. dollars),
when leaving the island. Since its official launch, surging 122% compared to 2020, according to the
the Hainan branch of China Post has mailed more local customs bureau in Haikou. Boosted by strong
than 2.08 million duty-free items for 231,000 online shopping demand, the transaction value
customers. The measures have boosted duty- of floor-mopping robots increased fourfold, and
free sales, local post office officials said. As part the transaction value of action cameras almost
of the master plan for the construction of the doubled in places such as Beijing and Shanghai,
Hainan Free Trade Port released by the central data from online shopping giant JD.com shows.
government in 2020, the newly adjusted duty- People who have opted to stay put for the holiday
are contributing to the increased online shopping
330
Background free shopping policies have sparked remarkable
enthusiasm among consumers. According to
Consumer goods are expected to continue to the master plan, China will build Hainan into a
grow in China in the foreseeable future. China globally influential and high-level free trade port
has proposed a 5% average annual growth rate by the middle of the century. Feng Fei, governor of
for the total retail sales of consumer goods during Hainan, said duty-free sales networks around the
its 14th Five-Year Plan period (2021-25), said the island will be expanded to better meet domestic
Ministry of Commerce. As the total retail sales demand for imported goods during the 14th Five-
of consumer goods have shown a steady and Year Plan period (2021-25), with sales of duty-free
slow development trend in recent years, service- goods expected to reach 300 billion RMB during
based consumption will continue to grow, and 2021 to 2025. Hainan has sold about 98 billion
its proportion will become larger in the country's RMB of duty-free goods from 2011 to 2021. During
household consumption in the next stage, said that time, more than 25 million people shopped,
Zhu Xiaoliang, director-general of the department and about 120 million items were sold, according
of market operation and consumption promotion to official statistics. With the new shopping policy
at the Ministry of Commerce. With people's living giving tremendous impetus to overseas brands,
standards continuing to improve, the nation's the Hainan FTP will likely become the world's
consumption trend has upgraded from purchasing biggest duty-free market in the near future if
goods to service consumption, and the share of the growth momentum continues, according
service Consumption is getting higher. Service to a report jointly released by KPMG China
consumption accounted for 52.5% of China's and the Moodie Davitt Report at the first China
household consumption in the first half of 2021, International Consumer Products Expo, which was
data from the ministry showed (Nan). held in Haikou in May of 2021 (Wenqian, “Policies
Help Fuel Duty-Free Hub Hopes”).
Increase in Duty Free Shopping
Chinese residents have opted for new ways
Throughout 2021, the duty-free shopping to celebrate 2021’s National Day holiday amid
boom has continued to pick up momentum in the COVID-19 prevention and control efforts, further
Hainan province as fine-tuned national policies stimulating the economy. Between 2020 and
turn the resort island into a duty-free shopping 2021, new consumption patterns in the shopping,
hub, officials and experts said. Offshore duty- tourism and culture sectors that have emerged
free sales reaped 46.8 billion RMB ($7.2 billion) during the holiday show that consumer demand
in the 12 months to June 30 in Hainan, surging has diversified. Both online and offline shopping
226 % year-on-year. The nine duty-free shops in have gained steam during the National Day
Hainan received a total of more than 6.28 million holiday, with sales in the “consumption-upgrade”
customers, a year-on-year increase of 102%, sector soaring. This was due in no small part to
and sold more than 60 million duty-free items, duty free sales areas such as south China’s island
up 211%. Customers spent most of their money province of Hainan. Consumers are attracted to
on cosmetics, watches and jewelry, according to the province by the variety of products available
customs officials. Hainan introduced mail delivery at friendly prices. Tax-free shopping sales on the
services for tourists to the island in early February, first day of the weeklong holiday reached 171
in addition to the original option of airport pickup million RMB (about 26.37 million U.S. dollars),
when leaving the island. Since its official launch, surging 122% compared to 2020, according to the
the Hainan branch of China Post has mailed more local customs bureau in Haikou. Boosted by strong
than 2.08 million duty-free items for 231,000 online shopping demand, the transaction value
customers. The measures have boosted duty- of floor-mopping robots increased fourfold, and
free sales, local post office officials said. As part the transaction value of action cameras almost
of the master plan for the construction of the doubled in places such as Beijing and Shanghai,
Hainan Free Trade Port released by the central data from online shopping giant JD.com shows.
government in 2020, the newly adjusted duty- People who have opted to stay put for the holiday
are contributing to the increased online shopping
330
