China on Thursday launched island-wide special customs operations in the Hainan Free Trade Port (FTP), the world's largest FTP by area, allowing freer entry of overseas goods, expanding zero-tariff coverage and more business-friendly measures.

The move is widely seen as a landmark in the country's efforts to further promote free trade and expand high-standard opening-up amid rising protectionism worldwide.

Under the new arrangements, Hainan has been designated as a special customs supervision zone.

Foreign companies can benefit from a business environment more closely aligned with international standards, lower tax and production costs, broader access to service sectors like healthcare and education, and use Hainan as a platform to tap into the mainland market.

The share of zero-tariff products in the Hainan FTP has been raised from 21 percent to 74 percent, expanding the list of related items from 1,900 to more than 6,600.

Zero-tariff goods processed in the province may be sold to the mainland duty-free if their local processing generated an added value of 30 percent or more.

During a speech at the port, Vice Premier He Lifeng called on local officials to "build Hainan FTP into a vital gateway leading China's new era of opening up to the world".

The project was a major strategic decision taken by the ruling Communist Party "with an eye to the overall situation at home and abroad," He said.

Chi Fulin, president of the China Institute for Reform and Development, said the special customs system demonstrates China's push to expand institutional opening-up.

"The benchmark is something similar to Hong Kong," said Ran Guo, director for Consumer Economy at the China-Britain Business Council.

"In addition to boosting Hainan's tourism sector, the plan should also encourage more foreign investment and manufacturing."

Hainan's GDP stood at US$113 billion last year, official data shows, the equivalent of the world's 70th largest economy, according to World Bank data. (Xinhua/Reuters)