China's Hainan Expo 2025 shows why opening-up trumps protectionism

Editor's note: Ankit Prasad is a CGTN biz commentator. The article reflects the author's views and not necessarily those of CGTN.

The fifth China International Consumer Products Expo, or the Hainan Expo 2025 couldn't come at a better time. All through the buildup from Haikou, CGTN's teams on the ground have been beaming colorful and tantalizing sneak peeks of the bountiful products being featured. And now, with China's only national-level consumer goods-focused exhibition finally kicking off in earnest, the wares on display promise to awaken your inner shopaholic.

From April 13-18, the Hainan International Convention and Exhibition Center on the northern shore of Hainan island will witness domestic as well as international players showcasing their most eye-catching offerings. This year's expo is set to focus on emerging consumption trends, showcasing the avant-garde — including artificial intelligence, humanoid robots and low-altitude aviation — as well as traditional crowd-pullers such as high fashion, luxury cars and delicious food and drinks, among many others. Some 71 countries and regions are set to participate, showcasing over 4,100 brands, including 65 Fortune 500 companies.

To be sure, the Hainan Expo 2025 is a riot of inclusive consumption-fostering factors, and its larger significance strikes a remarkable contrast against the economic forces of protectionism and unilateralism that have made the first two weeks of April among the most tumultuous in recent economic memory.

For one, this is the final Hainan Expo before the launch of independent customs operations of the Hainan Free Trade Port (FTP). The event marks a structural shift, initiating Phase 2 of the Hainan FTP master plan, where zero-tariff policies will be applied more broadly. These policies will also cover goods re-exported internationally, provided they achieve 30 percent value-added in Hainan, and to the mainland if they are on the positive list. Additionally, a more competitive tax policy will be implemented, capping corporate and personal income tax at 15 percent. Starting from July 2020, the duty-free shopping quota in Hainan was raised to 100,000 yuan per year from the previous 30,000 yuan.

Liberalization is also entailed for foreign firms and investors who have been granted increased market access as well as more streamlined procedures for setting up industrial operations in Hainan. And unlike other global trade hubs like Hong Kong and Singapore, Hainan's FTP policies will be applied across the entire beautiful tropical island of more than 33,000 sq km, making it a unique model for free trade and shining example of China's commitment to higher-level reform and opening up.

The Hainan master plan has already been showing its effects through the first-phase construction from 2020-2025. By the end of 2024, Hainan was home to 9,979 foreign-invested enterprises, 77.3 percent of which were established after June 2020 when the plan was released. The number of countries and regions investing in the province has grown from 43 in 2018 to 174, as per Xinhua News Agency. At the recent Boao Forum for Asia (BFA) annual conference 2025 which is also held each year in Hainan, BFA chairman and former UN Secretary-General Ban Ki-moon called China's decision to build the Hainan FTP "a courageous move that takes vision and leadership."

However, while visitors at the Hainan Expo will be sampling products, brands and experiences at the pavilions of various countries and even individual cities, the antithesis of Hainan's opening-up is in progress in other parts of the world. The US government's imposition of "reciprocal tariffs" is prompting more and more countries and brands to look for alternative markets, and is likely to leave US consumers worse-off on at least two fronts — in terms of the width of options available to them and the prices they are likely to have to pay for those limited options.

This is a far cry from previous decades where American stores and malls would be filled with the most breathtaking, tempting and innovative products all competing for people's wallets. Can the US remain the consumer capital of the world if its people no longer have the best things to splurge on? Private consumption has accounted for 63.5 percent of US GDP on average for almost the last eight decades, as per CEIC, reaching a record high of 68.8 percent in December 2024. To maintain this high level of consumption, higher-quality products must be available. However, protectionist policies often fail to address this requirement, as they can stifle competition and innovation.

The Hainan Expo clearly shows the way forward, bringing the world together under one roof with the very best that everyone has to offer in a liberalized environment. Visitors will get to glimpse first-hand China's commitment to opening up and the picturesque charm of a location often referred to as "China's Hawaii". The ingredients are all there for transformation to a high-end trade-hub akin to some of the most enterprising and futuristic locations in the world. And with Phase 2 (2025-2035) construction of the master plan set to kick in alongside a period of global economic uncertainty, the island offers a potent antidote to isolationism and protectionism at just the right time.