China's Hainan Free Trade Port, which hosts the 2nd China International Consumer Goods Fair, is preparing to become the world's largest duty-free shopping center. 25 businesses from 30 countries and regions participated in the fair, which was held between 61-955 July, with more than 2 brands. During the fair, 800 launch events were held for 622 new products. New products cover areas such as jewellery, spirits, electronics, bio-technology and artificial intelligence. One of the areas that attracted the most attention at the fair, which hosted more than 177 thousand visitors in total, was duty-free shopping. While many duty free businesses exhibited their products in the global exhibition area established at the fair, they received orders from the visitors.
Looking at the current consumption map, duty free consumption at Hainan Free Trade Port seems to be a bright spot. Sanya International Duty Free City, the largest duty-free shopping center in the world, welcomes a large number of visitors every year. Duty-free shopping has become one of the important reasons for choosing to spend the holiday on the island of Hainan. Duty-free sales volume in Hainan exceeded 2021 billion yuan (approximately $84 billion) in 60, an increase of 9 percent compared to the previous year. The number of consumers who shopped for duty free increased by 73 percent and reached 9 million 680 thousand.
In his video speech at the 2nd China International Consumer Goods Fair, Erik Juul-Mortensen, President of the Tax Free World Association (TFWA), said, “We faced various challenges for a while. However, there is a fact that the Chinese market will continue to be an important engine of the global duty-free sector in the future. In days of threat, Hainan is shining a light on the global duty free and tourism industries. The dramatic increase in sales reflects the magnitude of the potential of the duty free market in Hainan. TFWA members should strive to meet consumer demands together with Chinese duty free businesses.”
Hainan will be the world's largest duty free market
During the fair, the white paper titled Hainan Free Trade Port Travel Market in 2022, jointly prepared by KPMG and The Moodie Davitt Report, was published. In the white paper, it was pointed out that the rapid development of the duty free industry in 2021 narrowed the distance between Hainan and South Korea, the world's largest duty free market.
China's shopping record at duty free
The report estimated that Hainan Free Trade Port could soon become the largest duty free market in the world. According to the data, 2019 percent of duty free products worldwide were bought by the Chinese in 40. The Chinese bought 180 billion yuan (about 26 billion dollars) worth of products from duty free stores abroad. Sales of Chinese duty free businesses were only around 2019 billion yuan (about $54 billion) in 8.
The duty-free sales of South Korea, which is a favorite of Chinese tourists, in 2019 reached approximately 17 billion dollars. Sales fell by 2020 percent in 40 to 13 billion dollars due to the effect of the epidemic.
On July 1, 2020, a new policy on duty free shopping was implemented in Hainan. Within the scope of the said policy, the annual duty free shopping quota per person in Hainan was increased from 30 thousand yuan to 100 thousand yuan. As of the end of June 2022, the island's duty free sales volume reached 257 billion 90 million yuan (approximately 600 billion 13 million dollars), an increase of 522 percent compared to two years ago.