International supply chain and logistics consultancy SCALA has announced plans to assist businesses looking to supercharge their growth in China.
The initiative will see SCALA China offer a number of tiered support packages to companies interested in trading in Hainan, China, which is aiming to have a Free Trade Port (FTP) system in place by 2025 making Hainan the largest special economic zone in China.
SCALA’s services in this area will range from an initial strategic evaluation of the opportunity right the way through to more detailed operational evaluations and implementation.
Hainan is setting out to build an international centre featuring independent fiscal and taxation systems, as part of the overall FTP development plan. With SCALA China’s support, businesses looking to outsource production to Hainan, either setting up their own manufacturing or through partnering with Chinese companies with a production base in Hainan, are set for a number of business benefits.
Companies will benefit from a low-income tax rate, a cap in company tax of 15%, and freedoms in trade, investment, and capital flows. Furthermore, the policies are set to remove import duties, VAT and consumption tax for many categories of goods.
In addition, companies producing certain goods originating from Hainan that do not contain imported materials can be exempt from import tariffs when entering the rest of China.
Juliette Pitt, international business executive at SCALA China, commented: “SCALA China’s expertise and work in this hugely exciting project promises to enormously help foreign businesses seeking to grow their business in China. While it might seem a long way off, the time to invest is now as the government hopes to fully establish the FTP by 2025. Foreign companies should look towards this island to take advantage of the proposed tax benefits, as well as gain access to neighbouring ASEAN countries.
“In brief, businesses currently looking for ways to expand into China should explore this option now. By utilising the expertise offered by organisations with a wealth of pre-existing experience in the region, businesses can supercharge their international growth, unlock lucrative new markets and build resilience to continued domestic and international headwinds.”