MUNICH – As part of a congress, the vbw – Bavarian Industry Association (Vereinigung der Bayerischen Wirtschaft e. V.) examined the business opportunities for Bavarian companies in the Chinese free trade zone of Hainan. “China aims to develop Hainan into a globally significant trade hub over the next two decades. Thanks to its unique geographical location in the South China Sea, Hainan can evolve not only into an important gateway to China but also into a gateway to the ASEAN countries. Half of global economic growth is taking place in the Asia-Pacific region, and we must and want to take part in that,” said vbw CEO Bertram Brossardt ahead of the event.

“Hainan is intended to serve as a testing ground for a liberalized Chinese trade policy and economic reforms: with relaxed investment regulations, tariff reductions, and improved customs clearance procedures. In addition, foreign companies investing in Hainan are to benefit from simplified market access conditions and favorable tariff rates when exporting to the mainland. It’s also advantageous that the so-called negative list, which restricts foreign investments on the Chinese mainland, has been shortened for Hainan,” Brossardt explained, adding: “These are attractive measures – also for Bavarian companies – to encourage them to establish a presence in Hainan. However, these must not be mere promises. They must be implemented consistently.”

With regard to the necessary de-risking of one-sided dependencies, the fundamentally wrong approach would be to reduce trade with individual economies. This also applies, in the view of the vbw, to China. “The right approach is to continually open up new and additional markets. Less confrontation, more cooperation – that must be the guiding principle in global trade, especially now. After all, everyone benefits from a multilateral world,” Brossardt concluded.

Bavaria and China share a relationship that has developed over decades. China is Bavaria’s largest trading partner, even ahead of the USA. In total, the trade volume in 2024 amounts to more than 48 billion euros. Bavarian imports from China total 32 billion euros, about twice as much as exports. Almost a quarter of exports consist of passenger cars and car parts, another quarter of machinery. The most important imports are electronic products and equipment, accounting for well over 50 percent.