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Pilot FTZs advancing reform, opening-up

China Daily | Updated: 2018-11-27 06:51
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A technician installs an engine for an A320 plane under construction at the final assembly line of the Airbus plant in Tianjin. [Photo/Agencies]

Free port

The China (Tianjin) Pilot Free Trade Zone only began official operation in April 2015, as a way to draw in investment, but authorities are already planning its next phase of development.

The administration revealed to China Daily that it has, following detailed research and discussion, drafted and revised the construction plan of the Beijing-Tianjin-Hebei free port, which would further integrate regional development.

It said the plan will be submitted to the higher authorities "in due course". If it is approved, the blueprint for the free port would serve as a platform for the region to open further to the outside world.

A free port is set up within a country or a region's borders but is outside its customs' supervision. It is open to all commercial vessels on equal terms. Goods may be unloaded, stored and shipped without the payment of customs duties.

A free port needs specially designed policies in terms of market access, financial systems and taxation, said Wei Jianguo, vice-president of the China Center for International Economic Exchanges.

Earlier in 2016, a 10 billion yuan ($1.44 billion) government-backed fund was set up to promote the development and integration of the Beijing-Tianjin-Hebei region.

The Tianjin Pilot FTZ has made significant advances in the past three years. Peng Zhiwei, director of the department of international economics and trade at Nankai University, said the Tianjin FTZ has made several breakthroughs in terms of institutional reform, investment promotion, trade liberalization, and the innovation of financial systems.

Concrete measures have been taken in the zone to facilitate trade and investment, offering a one-stop service to companies. The average customs clearance time has been cut from up to two days to two hours. In addition, customs clearance costs have been slashed by 70 percent, and logistics costs by 30 percent.

The Tianjin FTZ has also begun specializing in car imports through a type of reduced duty called "parallel auto imports". In these, independent auto dealers directly purchase vehicles from a foreign production base or auto dealer. Prices for parallel-import cars are normally 10 to 20 percent lower than the prices offered by authorized dealers.

Since it was launched, the Tianjin FTZ has attracted 2,353 foreign companies, with total registered capital of 433.1 billion yuan. Airbus China, located in the Tianjin Pilot FTZ, signed a framework agreement in January with its Chinese partners to increase local production.

Vice-Minister of Commerce Wang Shouwen said China is gradually shifting from high-speed to high-quality growth, and that there is huge market potential. The country welcomes multinationals to seize growth opportunities in the Chinese market.

Wang made the comments at the 11th International Roundtable of Multinational Leaders. The conference, held earlier this month in Tianjin Binhai New Area, brought together government officials and business leaders to discuss the opportunities and challenges that lie ahead.

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