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Shanghai FTZ experience spurs innovation-driven growth through institutional reform

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By Luo Shanshan, Ding Qianqian

At Nangang Terminal in southeast Shanghai, a roll-on/roll-off vessel was steadily berthed at the dock, as a fleet of electric vehicles bound for export drove in an orderly manner into the ship’s hold under a “first-line direct customs release” model.

“Under this model, companies are exempt from customs declarations. With a single self-declaration, goods can move directly into and out of the Yangshan Free Trade Zone, significantly improving clearance efficiency,” explained an official from Yangshan Customs under Shanghai Customs.

As the China (Shanghai) Pilot Free Trade Zone (FTZ) pursues its goal of becoming a global shipping hub, it has refined its multi-country consolidation model. Cargo shipped from overseas, transiting via Yangshan, and bound for a third country, is exempt from inspection, cutting overall handling time by 50 percent.

This reform has driven the proportion of international transit and consolidated cargo at Yangshan Port from 12.6 percent to 18.6 percent, propelling it to the top of the global container port performance rankings. In the first half of this year alone, approximately 52,000 bonded vehicles were exported through consolidation, sharply reducing logistics costs.

In recent years, the Shanghai FTZ has pioneered institutional innovation, exploring new pathways and achieving “zero-to-one” breakthroughs to steadily expand institutional opening up, providing what has become known as the “Shanghai FTZ experience.” 

Seventy-seven pilot measures tested in Shanghai will soon be promoted nationwide, extending the benefits of institutional innovation across a broader landscape.

Beyond trade facilitation, Shanghai has taken the lead in formulating high-standard digital trade rules. The city is promoting regulated cross-border data flows, advancing digital technology applications, and expanding data openness and sharing.

At the Shanghai Data Exchange in Pudong New Area, intangible and invisible data products dominate corporate discussions. Meeting the rising demand for precise and efficient data transactions is a pressing concern.

According to Li Denggao, deputy general manager of the Shanghai Data Exchange, the exchange has established a cross-border data trading framework, developed a trusted delivery mechanism and released trading rules, gradually laying a solid market foundation. In the first half of this year, the exchange’s transaction volume exceeded 3 billion yuan ($417.39 million), a year-on-year increase of more than 50 percent.

Secure and efficient cross-border data flows are vital for companies’ international operations.

At the Cross-border Data Service Center in the Lin-gang Special Area of Shanghai pilot FTZ, real-time operation guidelines are displayed on electronic screens, tailored to industry-specific scenarios. In the intelligent connected vehicle sector, for example, guidelines cover cross-border production and manufacturing, global research and development testing, global after-sales services, and the global used car trade. 

“In the past, cross-border data flows were managed from an industry-wide perspective, which was not sufficiently targeted for enterprises,” said Lu Sen, head of the data division of the Administrative Committee of the Lin-gang Special Area. “We have identified specific data fields requiring across-border transfer and compiled detailed lists with relevant authorities to address the real challenges faced by enterprises.”

In February this year, the administrative committee of the Lin-gang Special Area, together with Shanghai Cyberspace Administration and other departments, jointly issued a negative list for data exports in the Shanghai FTZ. In May, it followed with detailed operational guidelines for such exports.

Financial innovation has also been a hallmark of the Shanghai FTZ. From establishing China’s first foreign-controlled joint-venture wealth management company and the first wholly foreign-owned public fund, to building an international oil and gas trading center, executing the first cross-border RMB settlement for international crude oil in digital currency, and piloting relaxed rules on non-resident mergers and acquisitions loans, the FTZ has delivered many “firsts” in financial opening up.

These breakthroughs have been followed by deeper reforms, including optimizing cross-border cash pooling for multinational corporations, advancing payment service internationalization, and continuously enhancing the free trade account system.

With inbound tourism and shopping in China continuing to boom, improving payment convenience for overseas visitors has become another focus.

Leveraging the FTZ’s role as a testing ground, Ant International, an affiliate of China’s Alibaba Group, has introduced two new services: enabling overseas bank cards to be linked to Alipay, China’s leading mobile payment platform, and allowing overseas e-wallets to be used directly in China.

From downloading an app and linking international bank cards to scanning and paying directly with an overseas e-wallet, inbound visitors now enjoy greater payment convenience.

Meng Huating, director of the free trade zone and free trade port department of China’s Ministry of Commerce, said the ministry will continue to work with relevant departments to actively support localities in replicating and adapting the “Shanghai FTZ experience” in light of their strategic positioning, industrial strengths, and local conditions.

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China’s Ninghai county produces 60 percent of world’s trekking poles

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By Liu Junguo, People’s Daily

At a sports equipment store near the Milan-Cortina Winter Olympics venues, shelves are filled with all kinds of winter sports gear. Among the items, a pair of beginner ski poles prominently displays its origin: “Made in China.” 

These poles hail from Ninghai county in Ningbo, east China’s Zhejiang province. This region, a powerhouse in outdoor equipment manufacturing, exports over 15 million ski and trekking poles annually to global markets.

Today, Ninghai commands nearly 60 percent of the global trekking pole market, with an annual output value approaching 1 billion yuan (about $145 million). Starting from scratch, the county has spent over two decades cultivating the industry and building technical expertise. It now boasts a complete  of Ninghai Better Outdoor Products Co., Ltd. (Better), visitors are greeted by a diverse array of trekking poles. One standout item is a training pole designed for novice alpine skiers. Made from aviation-grade aluminum alloy, the ski pole weighs less than 200 grams, offering both lightness and strength. Its handle, crafted from specialized materials, features an ergonomic design for trekking pole supply chain and is home to numerous well-known manufacturers and exporters.

Stepping into a showroomadded comfort.

“Overseas orders for this specific product for the 2025-2026 snow season alone have exceeded 800,000 units, a 30 percent increase year-on-year,” said Zhu Xuefeng, general manager of the company.

Better exemplifies the success story of Ninghai, but its origins trace back 26 years.

In 2000, Hu Jinxue from Ninghai came across aluminum alloy trekking poles from Germany at an overseas trade fair. He quickly recognized the potential of the outdoor equipment industry.

“At the time, Ninghai had a solid base in aluminum alloy forging, but its products carried low added value. Local enterprises were eager to upgrade, yet lacked a clear direction,” Hu recalled. 

After returning to China, he founded his company Xingda, introduced advanced technologies, and began producing trekking poles.

Leveraging strong expertise in metal processing and sustained technological upgrades, Xingda has grown into a leading industry player over the past two decades.

Even in its early stages, Ninghai adopted a forward-looking approach by identifying trekking poles as one of its key industries. A series of targeted measures has since helped turn it into a sector with an annual output approaching 1 billion yuan.

Inside Xingda’s smart factory, robotic arms move with precision, nano-level ironing activates fiber properties, and intelligent winding systems from dense, layered structures. Remarkably, within just 15 seconds, a roll of carbon fiber fabric is transformed into the high-strength shaft of a premium ski pole

As a key raw material for outdoor equipment such as ski poles, carbon shafts have long been expensive and subject to lengthy procurement cycles. Five years ago, Xingda still relied heavily on imports.

At that time, China depended on foreign suppliers for more than 90 percent of its high-end carbon fiber products, leaving independent innovation as the only sustainable path forward. Xingda responded by investing 70 percent of its annual profits into building a carbon shaft production facility and assembling a research team led by PhDs in materials science. After three years of intensive research, the company overcame key technical bottlenecks and achieved self-sufficiency in this critical material.

This breakthrough not only ensured stable supply and reduced costs but also led to a substantial leap in quality: Xingda’s carbon shafts are now 20 percent stronger than those produced by leading international brands..

Innovation is gaining momentum across Ninghai. Local manufacturers have filed more than 90 domestic patents, including utility models and industrial designs.

“This is one of our newly developed ski poles, designed to deliver high performance with environmental sustainability,” said Zhu Zhenkun, general manager of Ningbo Eastdragon Hardware Co., Ltd. (Eastdragon), displaying a sample. The eco-conscious design has proven highly popular in overseas markets.

In recent years, Zhu and his team have expanded internationally, where increasingly stringent carbon certification standards in Europe and the United States pose new challenges. In response, Eastdragon has not only improved product quality but also embedded green principles throughout its manufacturing process.

During production, leftover aluminum is recycled and reused, while new materials and processes are continuously explored. “After extensive testing of different handle materials, our research and development (R&D) team selected a biodegradable seaweed-based material,” Zhu said. “Handles made from this material offer a more comfortable grip and help reduce water use and carbon emissions.”

From a single product to a thriving industry, trekking poles have become a driver of local growth. Today, Ninghai has developed a complete industrial chain covering R&D and design, materials processing, component manufacturing, final assembly, and brand operations.  Today, the county hosts 34 leading enterprises and innovative small and medium-sized businesses within this specialized sector, solidifying its position as the world’s foremost center for trekking pole production.

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China implements measures to counter Japan’s accelerating remilitarization

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By Zhong Sheng, People’s Daily

China’s Ministry of Commerce has announced the placement of 20 Japanese entities involved in enhancing military capabilities on its export control list. A further 20 Japanese entities, where the end-users and end-uses of dual-use items cannot be verified, have been added to a watch list.

These actions are taken to safeguard China’s national security and interests, fulfilling international non-proliferation obligations, and prevent Japan’s pursuit of remilitarization and nuclear armament. 

The measures are fully justified, reasonable, and lawful, demonstrating China’s commitment to the rule of law and its responsibilities as a major country.

This follows China’s January 6th announcement of strengthened export controls on dual-use items to Japan. The latest move explicitly names specific companies, translates earlier restrictions into targeted, enforceable, entity-based controls designed to effectively safeguard national security and regional peace and stability. 

According to international legal instruments such as the Cairo Declaration, the Potsdam Proclamation, and the Japanese Instrument of Surrender, Japan is required to be fully disarmed and must not maintain industries that would enable its rearmament. 

However, a number of Japanese companies, including Mitsubishi Heavy Industries, IHI Corporation, and Kawasaki Heavy Industries, have long been active in the defense sector, producing equipment such as naval vessels, fighter aircraft, and missiles. 

For instance, multiple subsidiaries of Mitsubishi Heavy Industries have participated in the development of Japan’s hypersonic weapon system, the Hyper-Velocity Gliding Projectile for remote island defense. Vessels built by Mitsubishi Shipbuilding have not only supported Japan’s maritime activities related to the Diaoyu Islands, but have also been supplied to the Philippine Coast Guard for use in the South China Sea, posing risks to regional peace and stability. 

China’s measures represent a targeted response to curb Japan’s development of offensive military capabilities and to uphold international law and the post-war international order.

Japan’s push toward remilitarization is following a clear trajectory, with a new military-industrial complex rapidly taking shape. 

In recent years, Japan has accelerated its military buildup, with defense spending rising for 14 consecutive years from fiscal 2012 through fiscal 2026, and effectively doubling within three years since 2022.

State-driven support has enabled Japanese defense contractors to reap substantial profits, even fueling what some describe as a “defense bubble” in capital markets. Data show that since November 2022, the stock price of Mitsubishi Heavy Industries has surged by more than 650 percent, IHI Corporation by over 480 percent, and Kawasaki Heavy Industries by more than 280 percent. In stark contrast, Japan’s manufacturing sector has recorded an average annual growth rate of less than 1 percent over the same period.

Since Sanae Takaichi assumed power, Japan’s remilitarization process has noticeably accelerated. War preparedness has been elevated to an overriding national priority, with further support extended to defense-related interest groups. 

Reports indicate that the Japanese government plans to address defense funding gaps through large-scale bond issuance and a special income tax, while also preparing to establish a “national intelligence agency” this year. 

In a recent policy speech in the House of Representatives, Takaichi asserted that Japan must fundamentally strengthen its defense capabilities and pledged to clearly communicate defense procurement needs to industry. These steps are likely to further bind Japan’s defense spending to specific industrial and corporate interests, creating a self-reinforcing cycle.

At the same time, right-wing forces in Japan have shown a growing ambition to pursue nuclear capabilities. In recent months, some Japanese politicians have openly advocated for nuclear armament and sought to revise the long-standing “Three Non-Nuclear Principles.” 

It is widely recognized as a “nuclear-threshold state,” having long produced and stockpiled plutonium far exceeding civilian needs. By the end of 2024, Japan possessed as much as 44.4 tons of separated plutonium. 

With a complete nuclear fuel cycle and advanced nuclear industry capabilities, Japan is technically capable of producing weapons-grade plutonium. Should right-wing political forces push Japan across the nuclear threshold, it would represent a severel breach of the global nuclear non-proliferation regime. 

A recent commentary by Singapore’s Lianhe Zaobao noted that nuclear non-proliferation remains central to international politics, and that Japan’s pursuit of nuclear weapons runs counter to the interests of Southeast Asia, where reducing arms races and minimizing the risk of conflict are essential to regional stability.

Japan’s remilitarization and nuclear ambitions pose a serious threat to regional peace and stability. The lessons of history make clear that appeasement of militarism amounts to a betrayal of peace. Countering the rise of right-wing forces in Japan requires concrete actions.

China’s law-based control measures aimed to prevent dual-use items from feeding into Japan’s military expansion and firmly curb any resurgence of militarism. China will work together with all peace-loving countries to uphold the post-war international order and jointly maintain regional security and stability.

Japan’s right-wing forces should recognize that a return to militarism leads only to self-destruction.  Any reckless attempt to challenge international justice and the global order is bound to meet firm resistance from the forces of justice around the world.

(Zhong Sheng is a pen name often used by People’s Daily to express its views on foreign policy and international affairs.)

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Integrating grassroots Perspectives into China’s legislative process

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By Zhang Tianpei, People’s Daily

Shanghai recently hosted a legislative consultation meeting on the draft law on promoting ethnic unity and progress at the Gubei civic center in Changning district’s Hongqiao subdistrict. 

The meeting fostered an engaged discussion, with attendees — including deputies to the National People’s Congress (NPC), academics, legal professionals, and members of non- Communist Party of China political parties — offering a wealth of valuable insights.

For Sheng Hong, an NPC deputy and Party branch secretary in the local Ronghua No. 4 Residents’ Community, this marked her 11th such consultation meeting within a year.

“Over the past year,” Sheng noted, “the scope of these legislative consultations have covered critical areas like ecological and environmental protection, urban governance, and public well-being. Participants contribute diverse perspectives and specific revision suggestions based on their professional expertise. This process effectively integrates grassroots voices and professional insights, ensuring draft laws are more grounded in reality.”

Sheng reflected on the evolution of public participation. Initially, residents visited grassroots legislative outreach offices primarily to understand how laws are made. Gradually, she observed, they evolved from passive recipients of legislative information into active advocates for legal awareness. Today, a robust network for gathering public opinion has taken shape, with participation expanding significantly.

A notable moment came in July 2025, Sheng recalled, when the State Council issued guidelines on gradually implementing free preschool education. Residents who had previously contributed to consultations on the draft preschool education law felt a profound sense of accomplishment.  “They recognized that ideas debated at our grassroots offices were being reflected in national policy,” Sheng explained.

She emphasized the shifting public expectations: “The focus is no longer just on whether laws exist, but on their effectiveness, practicality, and ability to solve real-world problems.” During the legislative process of the preschool education law, factors such as demographic changes in school-age populations and household financial capacity were fully considered. 

The resulting legislation aims to encourage increased government investment to reduce family burdens while simultaneously strengthening kindergarten teaching staff and improving facilities. “Beyond ensuring access,” Sheng stated, “the law actively addresses the public’s demand for high-quality early education, enhancing its relevance and timeliness.”

Promoting “public well-being” with “public voices,” a steady stream of practical, experience-based legislative suggestions is being conveyed from grassroots legislative outreach offices to the Great Hall of the People for legal adoption.

To date, the Legislative Affairs Commission of the NPC Standing Committee has set up 60 local legislative outreach offices nationwide. Additionally, provincial and city-level legislatures operate a network of over 7,800 such offices. In 2025 alone, opinions and suggestions were solicited from these offices on 26 draft laws, yielding more than 34,000 submissions, many of which have been adopted in legislation.

“Matters of the people should be discussed by the people themselves,” Sheng said. “As an NPC deputy from the primary level, I will continue to stay close to the people, listen to their voices, pool their wisdom, and bring more of their views to the Great Hall of the People, contributing to the practice of whole-process people’s democracy at the grassroots level and to improving the quality of legislation.”

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