Editor’s Note
The recent policy shifts in Hainan’s Free Trade Port are creating unique opportunities for consumer goods, including gold. This article explores how these changes are driving a surge in investment and retail activity on the island.
A long-distance gold rush is unfolding in Hainan. Since the official launch of the island-wide customs closure operation in the Hainan Free Trade Port on December 18, over ten days have passed, with multiple related policies seeing their first batch of business implementations. Data from Haikou Customs shows that in the first week after the closure, Hainan saw 1,972 new foreign-invested registered enterprises, a year-on-year increase of 2.3 times.
After the closure, Hainan’s core policies focus on “zero tariffs, low tax rates, and a simplified tax system.” The “zero tariff” policy mainly includes: comprehensive liberalization at the “first line” (the national border) – except for a very few exceptions (such as items endangering national security or the ecological environment), the vast majority of overseas goods entering the Hainan Free Trade Port are exempt from import tariffs, import value-added tax, and consumption tax; and limited supervision at the “second line” (between Hainan and the mainland) – the flow of goods between Hainan and the mainland is treated as “import” and requires tax payment according to regulations. However, for goods produced by island enterprises with processing value-added exceeding 30% (inclusive) entering the mainland, import tariffs are exempt (already piloted in the Yangpu Bonded Port Area and to be extended island-wide after closure). The specific list for “zero tariffs” achieves full coverage.
A significant change is that the proportion of “zero tariff” commodity items has jumped sharply from about 21% before the closure to 74%. Production equipment imported by enterprises for their own use, transportation vehicles required for operations, and raw and auxiliary materials are basically all exempt from import tariffs, value-added tax, and consumption tax. The duty-free shopping quota for individuals has also been raised to 100,000 yuan per person per year.
For ordinary consumers, enjoying tax benefits still relies on the “off-island duty-free” policy. According to statistics, in the six days after the closure, the sales of four duty-free shops in Sanya reached 630 million yuan, a year-on-year increase of 47.2%, with daily average sales exceeding 100 million yuan.
This gold rush began on December 19, the day after the closure. At that time, price display boards at Laomiao Gold showed that the duty-free gold price for the day was 1,180 yuan per gram, while the tax-inclusive price was 1,356 yuan per gram, making the duty-free price 176 yuan cheaper per gram.
The key to the price advantage is that relevant taxes and fees originally levied on imported gold jewelry can be reduced or exempted at specific stages. Government subsidies and mall promotions can further lower the actual purchase price.
Standing at this historical juncture of record-high gold prices, for consumers, the tax benefits brought by Hainan’s customs closure make purchasing gold jewelry cheaper, indeed becoming a dividend for personal asset allocation. This explains why some people even come dragging suitcases.
In fact, even before Hainan’s closure, gold jewelry in Hainan’s duty-free shops already had duty-free status and government coupons. According to the China Gold News, the Hainan Free Trade Port had previously provided multiple policy supports for the gold and jewelry industry.
For example, the processing value-added duty exemption policy. Data from Hainan Customs shows that in the first half of 2025, Hainan enterprises utilized this policy to enjoy benefits on new goods worth 3.16 billion yuan, with tax reductions and exemptions amounting to 233 million yuan. Forty-eight beneficiary enterprises across the province involved 10 industry categories and 44 product application scenarios. Among them, 7 jewelry manufacturing enterprises, as well as products like pearl jewelry and sapphire jewelry, were among the first to benefit.
The second key policy is the preferential tax policy. Hainan has explicitly included “precious stone processing and jewelry inlay manufacturing” in its encouraged industry catalog. Eligible enterprises can enjoy a preferential corporate income tax rate of 15%, lower than the mainland’s 25%. Simultaneously, for high-end talents, the portion of actual tax burden exceeding 15% is exempted.
By the end of December, the post-closure gold rush in Hainan continues to heat up and intensify. Gold prices have sustained an astonishing bull market this year. Reports such as “After Hainan’s closure, the middle class swarms in to grab gold, buying 40 grams of gold jewelry can save over 10,000 yuan” densely topped trending lists on major social media platforms.
The southward gold rush of the middle class is just a microcosm.
For the gold industry, Hainan’s customs closure will also bring deeper opportunities.
On one hand, it benefits the industrial end of gold processing. Many investors and enterprises have turned their attention to links in the gold industry chain such as processing, trading, and storage, making layouts in Hainan by building industrial parks, regional headquarters, or creative centers.
Public data shows that Zijin Mining Group announced in December this year its investment in building an international business headquarters in Sanya, Hainan, to engage in deep gold processing business at an appropriate time. According to the National Enterprise Credit Information Publicity System, Zijin (Hainan) International Mining Operation and Management Co., Ltd. was established on December 9 with a registered capital of 100 million yuan. Its business scope includes non-coal mine mineral resource mining, metal and non-metal mineral resource geological exploration, mineral resource reserve estimation and report compilation services, etc.
Equity penetration shows the company is wholly owned by Zijin Mining Group Co., Ltd.
China Gold Group announced in early December this year its plan to establish a wholly-owned subsidiary in Hainan Province – China Gold Jewelry International Co., Ltd., with a registered capital as high as 500 million yuan. Lao Feng Xiang has also established Lao Feng Xiang (Hainan) Jewelry Co., Ltd. and Lao Feng Xiang (Hainan) Gold Jewelry Fashion Creative Center Co., Ltd. in Hainan.
Many well-known jewelry brands including De Beers, Bulgari, and TSL have already established a presence in Hainan.
More and more gold industry players are contemplating how to leverage Hainan’s geographical advantages to transform the landscape, address shortcomings like talent shortages and relatively backward supporting facilities, and explore more possibilities such as gold entrepot trade.
Many also fantasize about buying gold bars in Hainan and reselling them on the mainland to speculate on the price difference. But arbitrage opportunities come with hidden risks.
Gold commodities have high unit prices and heavy taxes. Once the carried amount exceeds the duty-free quota, or the quantity exceeds the reasonable quantity for personal use stipulated by customs, tariffs, value-added tax, and consumption tax must be paid. Moreover, the认定 of duty-free goods for reasonable personal use depends not just on the amount but also on the category and quantity.
If an individual carries goods exceeding the duty-free regulations from Hainan back to the mainland, the price advantage disappears after paying taxes.
It is reported that the current off-island duty-free shopping quota is 100,000 yuan per person per year. However, many media reports have already highlighted the phenomenon of a large number of professional purchasing agents frantically buying in duty-free shops. This has also triggered regulatory upgrades – Hainan has established a “duty-free product traceability system” to implement yellow list warnings for frequent purchasers.
Gold jewelry itself is an industry that integrates value, raw materials, and design attributes. Therefore, Hainan’s current gold advantage is still mainly reflected in “processing value-added” and “off-island duty-free consumption.”
The real gold rush opportunity ultimately does not depend on the price difference per gram, but lies in the industrial ecosystem effects released after the full island customs closure operation in Hainan.
Since entering 2024, influenced by multiple factors, international gold prices have repeatedly hit new highs, and domestic gold prices have also risen accordingly, with retail gold prices once soaring to over 600 yuan per gram. Market risks and volatility in gold prices always exist.
The current “gold rush” is largely built on expectations of continued gold price increases.
For consumers, how long can the heat of buying gold in Hainan last?
After the frenzy, this middle-class gold rush will eventually return to rationality.