Introduction of China's pilot FTZs

To date, China has established 21 national pilot Free Trade Zones (FTZs) in Shanghai, Guangdong, Tianjin, Fujian, Liaoning, Zhejiang, Henan, Hubei, Chongqing, Sichuan, Shaanxi, Hainan, Shandong, Jiangsu, Hebei, Yunnan, Guangxi, Heilongjiang, Beijing, Hunan and Anhui.

The layout of the pilot FTZs started with a 28.78-square-kilometer area in the four special customs supervision zones in Shanghai. After having been gradually optimized and expanded, 21 zones and 67 areas have been established, blazing new trails in reform and innovation.

The underlying guideline of the pilot FTZs is to explore new pathways and accumulate new experience for the comprehensive deepening of reform and the expansion of opening up.

In the last eight years construction of the FTZs has launched them as testing grounds for reform and opening up, and has explored and formed 260 institutional innovations for nationwide replication and promotion.

China's pilot FTZs promote a high level of opening-up. Their negative list for investment access had been reduced from an initial 190 items to 30 by 2020, while the first negative list for the Hainan free trade port had only 27 items.

The pilot FTZs' level of trade facilitation continues to take the lead in the country. The Single Window for International Trade of pilot FTZs gradually covers more than 20 departments including customs and taxation, as well as areas such as goods declaration and cross-border e-commerce, the construction level of which significantly exceeds the requirements of the WTO's Trade Facilitation Agreement and has been extended to the country. A series of facilitating initiatives, such as the classified supervision of cargo status and independent declaration of origin, have significantly improved the efficiency of customs clearance and reduced costs.

The opening and innovation in financial areas serving the real economy has been effective. A free trade account aiming at integrating domestic and foreign currency created in the Shanghai Pilot FTZ has effectively unclogged the overseas financing channel for enterprises and reduced financing costs, and has implemented in Guangdong, Tianjin and Hainan. Innovative measures that have been promoted nationwide included settling foreign exchange according to the willingness of foreign enterprises and foreign exchange capital accounts, cross-border two-way RMB capital pools, and other initiatives, renders the financing of enterprises more convenient, with wider channels and lower costs.

In 2020, a total of 393,000 new enterprises settled in the first 18 pilot FTZs, which, with an actual use of foreign investment of 176.38 billion yuan and total imports and exports of 4.7 trillion yuan, represented 17.6% of the country's foreign investment and 14.7% of imports and exports with less than four thousandths of the country's land area, playing an important role in stabilizing foreign trade and foreign investment.