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Special Economic Zones
Box 5.1
SIP Free Trade Zone Development 1994 (August): An office was set up to make preparation for the establishment of SIP Subadministration of Customs. 1995 (August): Custom’s Regulation on Supervision over Exports and Imports in SIP was enacted. 1997: SIP Weiting Customs Supervision Station was founded and became one of the first three express inland ports in China. 1998 (September): The second-class land port was opened in SIP. 1999 (May): SIP Subadministration of Customs was formally in operation. 2001 (January): SIP bonded zone for export processing (EPZ) was in operation. Customs adopted an electronic customs declaration and supervision system to manage enterprises in EPZ, where the Electronic Data Interchange system replaces the use of the Processing Trade Logbook and Bank Deposit Account System. Enterprises located in EPZ can enjoy additional preferential policies, including duty exemption for construction materials, equipment, packing materials, consumable materials, and a rational amount of office appliances. Other preferential policies include exemption from value added tax on products produced in EPZ and exemption from tariff quota and license control for cargos into and out of EPZ to and from overseas (excluding restricted items), and a tax rebate on Chinesemade raw materials, parts and components, packing materials, and construction materials entering into EPZ. 2002: With the approval of State General Administration of Customs, the first air-land transfer mode was introduced, making SIP a virtual airport. With the Air-Land Transshipment Model, supervised warehouses of the Shanghai Airport are extended directly to SIP, making import and export declaration possible at the local customs—SIP Customs. This function realizes a one-stop service for declaration, inspection, and dispatch, and it offers flexibility in the arrival, declaration, inspection, and clearance of goods. The time required for getting through customs procedures was greatly reduced from one to two days to seven to eight hours, making it possible for local IT companies to control their production cycle within five days. (continued next page)