At 11 PM on the 17th, when we reached Meng Xinli, Chairman of Greenchoco Food Manufacturing (Hainan) Co., Ltd. (hereinafter referred to as Greenchoco), his voice was hoarse from exhaustion as he packed the first batch of chocolate products set to enter the mainland market duty-free under Hainan Free Trade Port’s processing value-added policy after the island-wide customs closure. These products were scheduled to fly to Beijing and Xi’an via two cargo flights from Haikou Meilan Airport on the 18th.
Meng said, "After the customs closure, the processing value-added duty-free policy will cover the entire island, saving us 10% in tariffs when our products enter the mainland market." Since establishing operations in Hainan in 2021, Greenchoco has benefited from multiple tax incentives. "In the food processing industry, profits are earned penny by penny. The reduction in import tariffs alone has been a huge help," he added.
**"Completed in Just Three Hours"** According to an article published by the Jiangdong New Area Administration in Haikou, Greenchoco’s parent company, Green Chocolate Works Ltd., is headquartered in Coquitlam, British Columbia, Canada, specializing in handmade chocolate products. After acquiring the Canadian company, Meng adapted its products to better suit Chinese tastes.
In 2021, Meng participated in the China International Import Expo (CIIE) in Shanghai, where he learned about Hainan’s investment opportunities. Later, he attended the inaugural China International Consumer Products Expo (CICPE) in Haikou as an exhibitor. "I wanted to bring our products to China but struggled with location. Hainan’s food safety standards and natural environment convinced me," Meng explained. The island’s policies—such as zero tariffs on imported raw materials and equipment, duty exemptions for goods with 30% value-added processing sold domestically, and duty-free shopping for tourists—further attracted him.
In September 2021, Greenchoco was registered in Jiangdong New Area as Hainan’s first foreign-invested chocolate manufacturer. "As an encouraged industry under Hainan’s policies, we got our business license and seals processed in just three hours—an efficiency unmatched elsewhere," Meng noted. By April 2022, the company finalized its site and now operates three automated production lines with an annual output value of 80 million yuan.
**"10% Tariff Reduction Makes a Big Difference"** Greenchoco has leveraged Hainan’s zero-tariff policies, particularly for raw materials. Under the policy, companies registered in Hainan with independent legal status enjoy exemptions on import tariffs, VAT, and consumption tax for materials used in production or processing for export-oriented ("two ends abroad") operations.
Meng explained that "two ends abroad" means sourcing materials and selling products externally while manufacturing in Hainan. Greenchoco imports ingredients like cocoa butter, cocoa liquor, and cocoa powder from the U.S., Canada, and Mexico, with an estimated 20 tons of imports in 2025. "A 10% tariff cut is significant in this low-margin industry," he emphasized.
While most sales are domestic, the company plans to expand overseas, where products enjoy further tax exemptions. Since implementation, Hainan’s zero-tariff lists have covered imports worth 29.22 billion yuan, saving 5.47 billion yuan in taxes. Post-closure, the policy will expand to cover 74% of tariff lines (6,600 items), up from 1,900.
Greenchoco also benefits from streamlined customs as an Authorized Economic Operator (AEO), reducing clearance times by 60–70%. "Securing AEO status usually takes three months, but we did it in 45 days with government support," Meng said. Hainan now has 120 AEO-certified firms, exceeding the national average.
**Processing Value-Added Duty-Free Policy Expands Island-Wide** Hainan’s "dual 15%" tax policies—capping personal income tax for high-end talent at 15% and reducing corporate income tax to 15% for eligible firms—have also drawn businesses. Meng noted that Greenchoco, targeting 30 million yuan in sales this year, will benefit from the 10-percentage-point corporate tax cut compared to other regions.
On December 18, Greenchoco’s chocolates became the first batch of duty-free goods under the processing value-added policy shipped from Meilan Airport’s "second-tier" customs post-closure. One 36-kg batch is bound for Beijing, while a 600-kg shipment will reach Xi’an before distribution to Hanzhong. Both are exempt from tariffs, which apply to goods with at least 30% value-added processing in Hainan.
As of October 2025, 129 Hainan firms have utilized the policy, with duty-free domestic sales worth 11.1 billion yuan, saving 860 million yuan in tariffs. Post-closure, the policy will apply island-wide.
**Localization and Future Plans** Greenchoco offers over 300 chocolate varieties, with 30% sold outside Hainan. Meng aims to grow mainland sales and explore incorporating local ingredients like pandan leaves and tropical fruits. While imported cocoa enjoys zero tariffs, he plans to source Hainan-grown cocoa beans to further cut costs.
Hainan’s business-friendly policies have spurred rapid FDI growth, with 8,089 new foreign-funded firms established in five years and utilized FDI reaching 102.5 billion yuan, ranking among the nation’s highest.
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