China’s International Consumer Product Expo Attracted Worldwide Attention
In May 2021, China’s first International Consumer Expo was held with the aim to accelerate the entry of foreign brands and increase sales under the recently enacted tax-free policies for consumers that is one of many policies in the Hainan Free Trade Port. The Chinese central government has in 2020 released a roadmap for making Hainan a hub of increased opening to the world with policies covering many sectors. Apart from Consumer duty free & tourism, the strategy also includes policies for internationalizing the service sector, healthcare, information technology, transport sector and manufacturing that foreign companies should evaluate in their strategic planning for Asia.
In the second quarter of 2021, China’s held its first International Consumer Product Expo (CICPE) in Haikou, the capital of Hainan. The exhibition was jointly organized by China’s Ministry of Commerce’s Trade Development Bureau and the Hainan Provincial Bureau of International Economic Development, with the aim to accelerate Hainan’s Free Trade Port’s development and underline China’s commitment to open-up and share business opportunities with the rest of the world. Going forward, the event will be held annually, with a focus on consumer products.
The Expo, which took place from May 7 to May 10, attracted the attention of both international and domestic exhibitors from over 70 countries and regions to come and showcase their products. Over 1,400 companies participated to exhibit nearly 2,500 brands during its 4-day run. In addition, on the last day of the event, the exhibition was opened to consumers and attracted more than 50,000 visitors, bringing the total audience to around 100,000 people.
In the tropical Hainan province, Chinese consumers on vacation or business visits can buy duty-free foreign products, to bring with them when they return to other provinces of China. Hainan recently raised the annual duty-free shopping quota from 30,000 yuan (4,335 USD) to 100,000 yuan (14,450 USD) per each person. Also the number of duty-free product categories has also been expanded from 38 to 45, with products such as cellphones and laptops added to the list.
According to the statistics from China’s Haikou Customs, in the first quarter of 2021, around 17.8 million items were purchased by 1.8 million people in Hainan’s duty-free shops during the three-month period, an increase of 328% and 177% (YoY), respectively. With the strong recovery of consumer activities after the economic downturn 2020Q1 due to Covid, and the major enhancement of duty-free shopping, the total sales at Hainan’s zero-duty zone surged in the first quarter of 2021 and reached 13.6 billion yuan (2.1 billion USD), up 356% (YoY). According to a report by KPMG, it is predicted that Hainan’s free trade port agreement will soon become the world’s largest duty-free market if it continues to grow at the current trajectory.
The gathering of the world’s best quality products in the Consumer Product Expo in Hainan has brought in not only new opportunities for international companies to develop their businesses in China’s giant market, but also for the local players to bring their products to the world. Many foreign brands have launched their new products in this exhibition. For instance, Shiseido – a well-known cosmetic company in Japan has introduced its new skincare brands Ginza and Baum. Other big companies such as L’Oréal, Swatch Group also introduced their new products during the event