Editor's note: Located at the southernmost tip of China, Hainan is a relatively independent geographical region and the largest special economic zone in the country. It possesses unique advantages for implementing reforms and experimenting with the highest level of opening-up policies. The 2020 "Overall Plan for the Construction of Hainan Free Trade Port" will help Hainan implement a more proactive strategy of opening up and build the region into an important gateway for the country, facing the Pacific Ocean and the Indian Ocean.

Last year, Hainan's economic and social development was defined by three characteristics: overall stability, better quality and the accumulation of certain advantages in various fields, said Shen Danyang, executive vice-governor of south China's Hainan Province.

Shen made the remarks last Wednesday in an exclusive interview with CGTN in Haikou, capital of Hainan Province.

Shen said Hainan's economic growth, employment, and prices all remained steady last year. Production, risk prevention and control also remained significantly stable. As a result, last year saw a largely consistent level of economic and social development in Hainan.

Shen added that Hainan has proposed a number of policies and actions in relation to the provincial development objectives for this year. It can be summed up as the promotion of significant opening-up and significant reforms.

"Through opening-up and reform, we will promote consumption, investment, foreign trade, industries, innovation, domestic demand, as well as the achievement of the overall work goals," he said.

Export-oriented economic development

The executive vice-governor emphasized how Hainan's quality development has improved by looking at the quality of export-oriented economic development.

"In 2022, our overseas commerce exceeded 200 billion yuan (around $14 billion) for the first time, an increase of 36.8 percent from the previous year," Shen said. "That is around 20 percent greater than the growth rate for the entire country. Among them, export growth was the highest in the nation at 122 percent."

Shen said Hainan is a small province with a population of only roughly 10 million, many of its aggregate economic performance measures rank the third and fourth from the bottom. Nonetheless, Hainan is currently ranked among the top 10 in the nation for both outbound investment and the utilization of foreign investment. The utilization of foreign capital exceeded $4 billion last year. The amount has increased by over 10 times since five years ago.

"An emerging growth sector, outbound investment, only started to emerge last year. In 2022, Hainan's foreign investment almost doubled," he said. "And the rapid growth of Hainan's outbound investment has a lot to do with Hainan's plan of becoming a twin platform for cooperation with Southeast Asia."

Shen said Hainan wants to become the hub not only for Chinese enterprises to carry out economic and trade cooperation with Southeast Asia, but also for Southeast Asian businesses that are looking to explore the Chinese market.

Manufacturing investment

The executive vice-governor said Hainan has paid close attention to the growth of advanced manufacturing and high-tech industries during the construction of the Hainan Free Trade Port in recent years. That is why Hainan's industrial investment, particularly in manufacturing, saw a substantial increase of 33 percent last year.

Shen said the policies and business environment of the free trade port have also driven many companies to invest in entities and develop industries in Hainan. As a result, the oil and gas chemical industry, new materials, pharmaceutical manufacturing, automobile manufacturing, and wind power industrial equipment manufacturing are growing at a quick rate.

Connecting with the international trade standards and frameworks

The executive vice-governor stressed that the Hainan Free Trade Port is an open platform that follows or measures itself against the best standard in the world. Opening to the outside world means connecting with international economic and trade rules.

"You may have noticed that Hainan Province recently enacted 10 measures to expand market access for Hong Kong's professional service sector," he said. "For example, we have implemented a system that recognizes Hong Kong specialist certificates."

Under the system, Hainan will grant the country's most open policies to Hong Kong's professional services and expand the scope of Hong Kong vocational qualification recognition in Hainan. The country's most open policies have also been introduced to other service industries in Hong Kong, such as legal services, arbitration services and accounting services.

Business environment construction

"In the last few years, the business climate has seen significant change and good progress," Shen said. "It is because of these changes that more and more market players are coming to Hainan to register and operate."

Shen stressed that Hainan's compound economic growth rates for 2020 and 2021 are both the highest in the nation. All of these are greatly influenced by the rapid transformation and ongoing improvement of Hainan's business climate.

At the end of last year, China's first Business Environment Construction Department was inaugurated in Hainan.

Shen said the department has been given four tasks. It should act as the general staff and command center. Its job is to do comprehensive coordination and overall planning, organizing and promotion tasks.

"We also need to turn the department into a construction team to foster the building of important projects for the business environment," he said. "For instance, all provincial government functions must be handled online through a single network, all at once."

Shen said making the department operate like a waiter is the third strategy. Its duty is to serve enterprises and the people. The department should also lead institutional innovation in the development of the business environment.

Dual-carbon goals and green initiatives

Shen rated Hainan's achievements in carbon peaking and carbon neutrality, as well as pursuing green initiatives.

He said Hainan hopes to achieve three goals. The first is to become a leading player in carbon peaking, carbon neutrality and pursuing green development. Second, Hainan must continue to maintain the high-quality level of Hainan's ecological civilization. And finally, Hainan must actively pursue institutional innovation in the creation of ecological civilization, as well as in the task of carbon peaking, carbon neutrality, and green development.

Shen introduced that six significant projects are being planned and carried out to this purpose, including the construction of the National Tropical Rainforest Park and a zero-carbon demonstration zone on Dongyu Island in Boao.