Xiamen Xiangyu Free Trade Zone

Xiamen Xiangyu Free Trade Zone (XFTZ) was established with the approval of the State Council on October 15, 1992. As a test field for Xiamen to accelerate certain trade-free port policies, XFTZ is exploring new development and providing Chinese and foreign merchants favorable trade opportunities. It is operated in accordance with international practice and is closely linked with the world market.

The zone focuses on international trade, trade with Taiwan, transit trade, bonded storage and export processing, as well as other business like finance, insurance, future market, commodity exhibition, management of wharf, transportation, information and other related business. 

Xiangyu Free Trade Zone is located on two square kilometers in the northwest of Xiamen, with Dongdu Harbour to the west, Harbour Railway to the east, Xiamen Bridge to the north and Xiangyu docks to the south. Its geographic location is superior and easily accessible.

Key Functions of the XFTZ
1. International trade
All the companies in XFTZ are allowed to enterprise and develop international trade, mainland-Taiwan trade, entrepot trade and other import and export trade regulated by the state.

2. Bonded warehousing and exhibition
All the companies in XFTZ are allowed to do warehousing, transportation and exhibition businesses of international entrepot, transit, import and export goods.

3. Export processing
XFTZ encourages Chinese and alien investors to set up factories to do international trade-related simple processing, separating, grading and assembling of export-oriented products.

4. International finance
With approval of People's Bank of China, Chinese and alien-funded banks and other finance institutions are allowed to do business of banking, insurance, offshore finance, future finance and goods, and other foreign currency operations.

5. Preferential Policies
The preferential policies practiced by the XFTZ have been endorsed and legally sanctioned by the Standing Committee of Xiamen Municipal People's Congress. 

6. Taxation
Good shipped from abroad to XFTZ are exempted from tariff tax and value-added tax.
Goods exchanges, processing, and labor services are exempted from value-added tax.
Companies in the XFTZ are exempted from income tax for the first two years of profit, and then taxed at half rate for the following three years (income tax rate is 15%.)

Xiangyu Free Trade Zone is a test zone for Xiamen SEZ in accelerating the implementation of certain free port policies. The zone focuses on international trade, trade with Taiwan, transit trade, bonded storage and export processing, as well as finance, insurance, futures markets, commodity exhibitions, wharf management , transportation, information and other related business.

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