Hainan Province, China’s southernmost tropical island, is charting an ambitious course to position itself as a key player in the rapidly expanding low-altitude economy. On February 16, the Hainan Provincial Government unveiled a comprehensive set of measures aimed at fostering the high-quality development of general aviation and the low-altitude economy. 

The 18 draft initiatives, which are open for public feedback until March 16, reflect the region's commitment to transforming its economic landscape and tapping into new growth sectors.

These measures come in the wake of Hainan’s earlier announcement of a three-year action plan, targeting the creation of a robust industrial chain for the low-altitude economy, valued at over $4 billion by 2026. The proposal includes the construction of nine general-purpose airports and the establishment of 500 takeoff and landing sites for low-altitude aircraft. 

By leveraging its natural assets, Hainan is poised to unlock the potential of sectors such as drones, electric vertical takeoff and landing (eVTOL) aircraft, low-altitude logistics, and air tourism.

The provincial government’s draft proposal includes a variety of financial and infrastructural incentives designed to attract investment into the sector. Notably, Hainan will offer substantial financial support for infrastructure development. For example, projects related to the construction or expansion of general-purpose aviation facilities at transport airports and public takeoff and landing sites, if funded by private capital, will be eligible for government support up to 20% of the total costs. For specialized communications, navigation, and monitoring infrastructure, the government will provide up to 50% of the costs.

Hainan is also focused on creating a conducive environment for business development. The draft suggests the establishment of a dedicated general aviation and low-altitude economy industrial investment company, as well as the promotion of low-altitude economic pilot zones in cooperation with local governments. These initiatives are designed to foster growth in the sector and ensure that Hainan remains a key player in China’s low-altitude market.

According to Liang Haiming, Dean of Hainan University’s Belt and Road Research Institute, the low-altitude economy in Hainan is poised to take off as early as 2025. The province's extensive coastline offers a unique advantage for low-altitude logistics and air taxi operations, providing an opportunity to conduct drone-based services across expansive areas that would otherwise be difficult to access. With support policies targeting technological innovation and infrastructure expansion, Hainan is positioning itself to become a leader in the global low-altitude sector.

The integration of resources from other high-tech sectors, such as space exploration, also presents promising opportunities for synergies. Aki Wang, a manager at the Boao Innovative Development Center, highlighted the potential for collaboration between the aerospace and low-altitude industries, particularly in airspace management and material innovation. The region's proximity to the Wenchang Spacecraft Launch Site offers unique opportunities for cross-industry collaborations that can accelerate the growth of the low-altitude economy.

While Shanghai’s approach is ambitious, it is also designed with broader implications in mind. The city's negative list model for data export is not just a local initiative but has the potential to be replicated across other FTZs in China. By extending this framework to other regions, Shanghai aims to create a coordinated national system for cross-border data movement, which could enhance China's competitiveness in global data trade and innovation.

Government officials in Shanghai have already indicated that data export lists introduced in other FTZs, covering sectors such as artificial intelligence, biomedicine, and automotive, can serve as reference points for the Shanghai negative list. This holistic approach to data governance is expected to lead to more synchronized policies across the country, making it easier for businesses to operate in multiple regions.