With tariffs rising around the world and President Trump vowing an end to decades of globalization, China’s leadership is trumpeting a tropical island as proof that it is moving in the opposite direction.
The island of Hainan — a province of China off the country’s southern coast 50 times the size of Singapore — last month scrapped tariffs on most imports, slashed corporate and individual taxes and declared itself the world’s largest “free trade port.” China declared it an emblem of its readiness for two-way trade with the world.
Xi Jinping, China’s top leader, called Hainan “a significant gateway leading China’s opening up in the new era.”
As portrayed by Beijing, Hainan’s experiment with tariff-free trade recalls the spirit of China’s early reform era after the death of Mao Zedong in 1976. The Communist Party ditched socialist dogma and began testing bold free-market policies in certain areas. Those that worked were rolled out more widely.
China’s place in global trade is very different now. The country has grown into the world’s unrivaled manufacturing power and second-largest economy. Mr. Xi has repeatedly called for self-reliance and worked to ensure that China is never dependent on anything foreign. He has shown little interest in altering the high tariffs and export-focused policies that helped give China a gargantuan $1 trillion trade surplus last year.
