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Trade Liberalization and Facilitation (Policy Interpretation - Part II)

Release time: 2022-05-16 09:00        Source: 投资海南

Trade Liberalization and facilitation are a common feature of international advanced free trade ports, hence an important goal for the development of Hainan Free Trade Port. On Apr.19, the Ministry of Commerce among some 20 departments released the Circular on Several Measures to Promote Trade Liberalization and Facilitation of Hainan Free Trade Port, which introduced a series of trade liberalization and facilitation policies and measures in terms of trade in goods and trade in services, including: relaxation of trade qualification and quota management of such commodities of crude oil, refined oil, sugar in accordance with requirements of free flow through the first front and efficient control at second front, meanwhile, both access and operation qualification is allowed in the area of trade in service, and technology import and export could be operated without requirement for registration as a foreign trade operator, etc.   

Trade Liberalization and Facilitation

(Policy Interpretation - Part II)

The Ministry of Commerce and other 19 government bodies jointly issued the Circular on Several Measures to Promote Trade Liberalization and Facilitation of Hainan Free Trade Port, aiming to further increase support and accelerate the process of trade liberalization and facilitation of the free trade port. To help you understand the background and practical meaning of the measures, We have published a series of policy interpretations.Today we bring the second part of the interpretation series.

4. What considerations does Ministry of Commerce have in supporting Hainan’s development of the convention and exhibition industry?

The exhibition industry is a pillar and leading industry in the national economy, an important platform for promoting higher-level opening up and quality economic development, and one of the major areas in developing the modern service industry in Hainan FTP. In line with the requirements of the Master Plan, MOFCOM will support the exhibition industry in the following aspects to bolster its quality development.

1. Improve government services. We will deepen the reform of streamlining administration of the exhibition industry, allowing foreign organizations to independently hold foreign-related economic and technological exhibitions whose name shall not contain “China”, “National” and so forth. The approval right of foreign-related economic and technological exhibitions held independently or jointly by foreign operators will be delegated to Hainan Province, so as to provide convenience for enterprises and help flourish Hainan's exhibition industry.

2. Render full support to Hainan in hosting the China International Consumer Products Expo, or "Hainan Expo". Organizing Hainan Expo is a key task in optimizing the overall layout of China's exhibition industry, constitutes a pragmatic move to promote FTP building and help foster the new development paradigm. The Hainan Expo will effectively bring together domestic and international quality consumer goods, and is beneficial for optimizing domestic market supply and satisfying people's needs for a better life. Meanwhile, it is conducive to promoting domestic and foreign demands, coordinating the development of import and export trade, and helping to form a virtuous cycle with a higher level of openness.

3. Give further support for Hainan to improve the layout of the exhibition industry. In light of the FTP construction, we will support Hainan in building a comprehensive investment and trade exhibition platform, integrating and optimizing resource allocation, and giving play to the role of the investment promotion platform and spillover effects, aiming to grow Hainan's exhibition industry bigger and stronger.

4. Provide further support for Hainan to innovate exhibition service models. We will encourage Hainan to develop new forms of business and new models of the exhibition industry, speed up the process of informationization, vigorously promote the digital transformation of exhibition projects, deepen international exchange and cooperation and strengthen international marketing and external promotion of exhibitions, so as to set up a sound exhibition industry chain in Hainan.

5. Regarding the opening of oil trade, what measures will be taken for further promotion of the sector in the next step?

In recent years, China has continuously promoted the reform of oil and gas systems, continuously improved the management system of oil trade and upgrade the level of oil trade facilitation, which has effectively guaranteed the stable supply of domestic crude oil and refined oil products. Since the release of the Master Plan, MOFCOM has supported Hainan to accelerate building up new competitive advantages with Hainan’s own features from top-level design according to the development orientation requirements of the FTP; has supported Hainan to expand oil trade, accelerate the construction of Yangpu Petrochemical Industrial Base, and give better play to Hainan’s oil and gas storage capacity; has supported Hainan to import wax oil among other special oils, accelerate the formation of industrial advantages, and promote the upgrading and development of Hainan's special oil manufacturing industry. Currently, trade of oil products takes up an important position in Hainan's foreign trade, and will drive the transformation and upgrading of Hainan's petrochemical industry and oil and gas industry.

The Several Measures issued this time specifies that “pilot projects will be launched in Yangpu Bonded Port Area for the import and export of crude oil and refined oil products through the “first front”, where corporate qualification and quantity management will no longer be required, while import/export through the “second front” will be managed according to current import/export regulations.” Not requiring corporate qualification and quantity management in special areas is a special institutional arrangement made for the Hainan FTP by MOFCOM. The trials and attempts will be made in Yangpu Bonded Port Area to accumulate experience for expanding the scope of specific areas in the future and eventually popularizing it on the whole island and promoting free trade of oil products on Hainan Island.

Next, MOFCOM will, in accordance with division of duties, press ahead deliverance of tasks, fully support the opening and development of Hainan FTP, and at the same time explore new ways and accumulate new experiences for the overall promotion of oil import and export management reform, in a bid to boost the quality development of the oil and gas industry and better serve the national energy security.

6. The Circular states that Hainan is encouraged to participate in formulating the recommended national standards, local standards and group standards. What measures will China’s standardization sector take to promote the quality development of the Hainan FTP, and what should be considered in China’s international standardization drive to boost trade liberalization and facilitation in Hainan FTP?

Building the Hainan FTP is a major decision and deployment made by the CPC Central Committee. General Secretary Xi Jinping made important instructions on the FTP construction, emphasizing the integrated institutional innovation and high-quality and high-standard construction of the FTP, which provides fundamental guidelines for the initiative. Standards and measurement, certification and accreditation, inspection and testing together constitute not only the country's infrastructure of the quality system but also one of the four pillars for the sustainable development of the economy. To promote the quality development of the FTP through standards, the State Administration for Market Regulation will focus on the following three measures:

1. Establish the standard system for the quality development of the FTP. We will guide Hainan in establishing a high-quality system of standards that meet the needs of building the FTP, support Hainan in promoting the development of tourism, modern services, and high-tech industries, establishing a standards system for the international tourism and consumption center, setting up public information guidance system in tourism consumption places and standardized foreign language signs, giving due support to Hainan in its construction as international tourism and consumption center. For Hainan’s feature tropical agricultural products such as coconut, mango, tropical spices, and competitive feature industries such as exhibition, full bio-degradable products, we will keep aligned with international standards and advanced foreign standards to establish a sound standard system and promote quality development of the industries.

2. Explore to establish the "standardized + green" development model. General Secretary Xi Jinping mentioned in his keynote speech in the opening of the just-concluded online Boao Forum for Asia that green should be made the representative color of the Belt and Road Initiative. Hainan as the strategic fulcrum of the BRI, while directing the implementation of the Three-year Action Plan for the Construction of Green Standards in Hainan, we will carry out standardized projects in key areas, make and revise a number of national, industrial, and local standards, and create a number of green standardized pilot demo projects. These measures are expected to support the construction of the national pilot zone of ecological conservation and the construction of the Hainan FTP, by forming a number of excellent standardization cases of practice and replicable typical work models to support the green development and ecological civilization in Hainan.

3. Formulate and strictly implement technical standards for the treatment of plastic pollution. We will guide Hainan to strictly implement the national standards related to fully bio-degradable plastic products, formulate relevant local standards based on local characteristics, and provide technical support for the “plastic ban” in the province. We will encourage the production enterprises in Hainan to actively participate in the standardization activities and “pace-setting” activities concerning enterprise standards, align with international standards and advanced foreign standards and improve the production technology of fully bio-degradable plastics. Meanwhile, we will support Hainan in its efforts to develop technical standards related to graphic marking of fully bio-degradable plastic products, hence facilitating market supervision, quality supervision and sampling, and product tracing of fully bio-degradable plastic products.

Standards as the world’s “common language”, is the passport to international trade. Countries around the world attach great importance to cooperation and exchange in the field of standardization, especially the application of standards to carry out international cooperation in production capacity, technology exchanges, and economic and trade exchanges.

Next, the SAMR will take five measures to promote trade liberalization and facilitation of the Hainan FTP.

First, we will actively organize the technical counterpart units for international standardization in all sectors and fields nationwide so as to provide a convenient communication platform for enterprises and public organizations in Hainan to participate in international standardization activities and further smooth the channels for them to participate in international standardization activities.

Second, we will guide enterprises and public organizations to study and set up working groups in the fields of advantageous technologies and industries, promote the transformation of advantageous technologies and sci-tech achievements into international standards, and further improve the international standard system, so as to contribute Chinese proposals to the global sustainable development.

Third, we will promote the FTP to pace up the transformation and application of international standards, enhance the consistency between international and domestic standards, and support the development of the FTP to keep in line with international standards. The SAMR will conscientiously implement the spirit of the Fifth Plenary Session of the 19th CPC Central Committee on stepping up efforts to promote institution-oriented openness of rules, regulations, management, standards, etc., encourage foreign-invested enterprises to participate in the drafting of national standards and the translation of such standards into foreign languages, and put forward their suggestions in the course of initiating projects for standards, solicitation of comments, implementation of standards, etc. At the same time, we should make public the service procedures and time limits by taking standards as a starting point, so as to make it more convenient to invest in and run enterprises, and create a better business environment.

Fourth, we will respond to the needs of Hainan for import and export trade and economic and technological exchanges and cooperation, build a bilateral and multilateral platform for standardization, and promote Hainan to strengthen the “hard connection” of national infrastructure for the BRI and the “soft connection” of rules and standards. To unblock trade and investment cooperation channels, we will speed up the formulation of standards related to Hainan’s advantageous trade products in foreign languages and promote Hainan’s advantageous products, technologies, and services to gain international recognition.

Fifth, we will support and guide Hainan in carrying out the training for talents specialized in international standardization, and provide guidance in terms of faculties, teaching materials and curriculum design, so as to help Hainan improve its training for talents specialized in international standards and constantly improve the number and level of registration experts of the Hainan International Standardization Organization so as to provide intellectual support for the development of the Hainan FTP.  

7. In areas where “free flow through the first front and efficient control through the second front” is applied, licensing measures for the import of machinery and electronic products will be removed when they enter through the “first front”. What is the positive role of this measure in the development of the Hainan FTP?

Trade liberalization and facilitation are an important part of the system design of the FTP. In terms of trade in goods, along with the introduction of the list of goods with “zero tariffs”, we are also actively accelerating the trade liberalization and facilitation related to non-tariff measures.

To support the FTP development, MOFCOM, in consultation with the GAC and other relevant departments, has decided that in areas where “free flow through the first front and efficient control through the second front” is applied, licensing measures for the import of machinery and electronic products will be removed when they enter the “first front”. Import of such products will be administered by Hainan FTP itself on conditions of safety and environmental protection and entry via the “second front” will be administered according to current import regulations. At present, the key used mechanical and electronic products in the catalog of goods subject to import license administration have 69 10-digit customs commodity codes in 13 categories, including chemical equipment, metal smelting equipment, engineering machinery, etc. According to the Several Measures, the import of the above products through the “first front” does not require any import license issued by MOFCOM, but is only subject to administration by the FTP itself on conditions of safety and environmental protection. This not only ensures the requirements for safety and environmental protection but also facilitates the import of goods and is conducive to attracting more enterprises to increase investment in Hainan and promoting the development of the Hainan FTP. 

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