Charles Chen reveals plans for the world’s biggest duty free complex, to be located at Haitang Bay
China Duty Free Group (CDFG) yesterday unveiled plans for what it said will be the world’s largest duty free complex at Haitang Bay in Sanya on the resort island of Hainan.
Haitang Bay Duty Free Complex will offer 350,000sq m of total space, including 150,000sq m dedicated to commercial services. The duty free store, to be built in two phases, will cover 100,000sq m. Phase one will open in two to three years. 
The store will benefit from the recent new regulations that allow Chinese shoppers to buy duty free on Hainan Island. That legislative change has already led to an extraordinary shopping boom at CDFG’s existing Sanya Duty Free store.
Haitang Bay is one of the five major bays in Sanya.
Announcing the development during the Gate One2One conference in Singapore run by Tax Free World Association, CDFG Vice President Charles Chen revealed that the complex will include a duty free retail centre, a luxury brand exhibition area, a designer hotel and a major food & beverage offer.
The project belongs to CDFG parent company China International Travel Service (CITS) Group. CDFG is responsible for the retail.
Chen told the audience: “Hainan’s new domestic duty free shopping policy means a [potential] market of US$425 million [annually] and it is not enough to simply rely on Sanya Duty Free store with 7,000sq m and crowded with 18,000 people every day. Therefore we introduce Hainan International Duty Free City.
‘It will be the largest duty free shopping centre in the world after completion. The parent company of CDFG, CITS Group Corporation, has entered into a co-operative development agreement with the Sanya Municipal Government. The project is now in the planning and design stage and we will formally launch the brand invitation within the year.’
Chen also revealed that the government is preparing further legislative changes to allow Arrivals duty free in Guangzhou, Shenzhen and Zhuhai this year. As previously reported, privately operated Sunrise Duty Free already runs some Arrivals shops in Shanghai and Beijing.
‘This is to keep more luxury consumption within China,” Chen said. “We aim to add entry [Arrivals] duty free business to key airport, border and port duty free stores nationwide. The sales volume of these duty free stores will be increased by about +30%.”
Chen noted that the big difference between Chinese domestic market retail prices and overseas pricing means that more than 50% of Chinese luxury spending is conducted abroad. Arrivals shopping will address that disparity, he said.
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