Sanya's Yazhou Bay: From beachfronts to breakthroughs

Marine science, preferential policies and talent incentives are reshaping Sanya into a growing hub for high-tech startups.

An elevated view of the Yazhou Bay Science and Technology City, which is located in Sanya, Hainan province. CHINA DAILY

For many Chinese people, Sanya in South China's Hainan province is the ideal destination for coastal tourism. However, for many business startups, the city is emerging as a prime choice for entrepreneurial success.

Deep-sea innovation

Xu Shupeng of Hainan Langyan Optoelectronics Technology has been running a company in the Sanya Yazhou Bay Science and Technology City for two years. As the deputy general manager of the company, he arrives at work every day to inspect equipment, collect and organize data, formulate research plans and promote products.

"I came to Sanya to solidify our technology advantages and expand our product line, trying to transform the scientific research achievements from universities into marketable products," he said.

Since its launch in July 2023, Langyan has filed 14 patents in just two years. With an annual turnover exceeding 5 million yuan ($709,522) in 2025, it is securing a firm foothold in the field of ultrafast laser precision control.

At present, the company has developed a high-energy femtosecond laser, YbFemto-HP, a device widely known as "the fastest knife" that can cut, drill holes and groove the surface of hard materials. In Hainan, however, this product has a more important role: applying superhydrophobic, anti-corrosion and rust-removal treatments to the hulls of ships engaged in deep-sea exploration.

Access to nearby deep-sea resources was a key factor behind Langyan's decision to set up in Sanya. Nanshan Port, located in Sanya's Yazhou district, is the closest port in China to sea areas with a water depth of 1,000 meters. It takes only half a day to sail from here to the area. "This geographical convenience allows our equipment to complete testing quickly," Xu said.

Apart from the tax incentives and trade facilitation policies of the YZBSTC, the city's focus on deep-sea technology and high-end equipment is aligned with the application scenarios of the company's core businesses such as marine laser equipment, Xu said.

In the initial stage of entrepreneurship, the company was confronted with a series of challenges, including difficulties in recruiting high-end technical talent, weak connections with the local supply chain and heavy financial pressure.

The targeted incubation services provided by the YZBSTC played a crucial role — they not only offered key support such as talent apartments, settlement subsidies and shared laboratories, but also organized industry-university-research collaborations and matched industry chain resources, helping Langyan establish operations and achieve market expansion.

Recalling the differences between working in Sanya and Shanghai, where Xu used to work as a researcher, he said that while the fast-paced work environment in Shanghai can drive rapid personal growth, excessive pressure may instead restrict performance. In Sanya, the more balanced work rhythm enables people to focus more energy on work and pursue their aspirations wholeheartedly.

Nanshan Port, facing the South China Sea and backed by Yazhou Bay, is Sanya's sole seaport for foreign-oriented maritime transportation, serving both scientific research and cargo transportation.

Backed by industries in the YZBSTC, the policy dividends of the Hainan Free Trade Port — including zero tariffs, low tax rates and a simplified tax system — will be fully realized after the island-wide special customs operations. This is expected to significantly reduce institutional costs for key industries.

As a key industrial park for the construction of the Hainan FTP, the YZBSTC is developing two major sectors: breeding science and deep-sea technology.

Focusing on industries such as deep-sea equipment, marine pastures, marine energy, marine biomedicine and marine public services, it has attracted high-profile research institutes and leading enterprises, including Shanghai Jiao Tong University, Zhejiang University, Ocean University of China, the Institute of Deep-sea Science and Engineering of the Chinese Academy of Sciences and China State Shipbuilding Corporation.

Free trade dividends

Wang Xiao, one of the founders of SensingX Technologies (Hainan) located in the YZBSTC, also recognized the advantages of the Hainan FTP. As early as 2021, he began participating in research and commercialization related to brain-computer interfaces here.

"Based on the policies of the Hainan FTP covering tariffs, talent and services, as well as the industry's development prospects, I concluded back then that the Hainan FTP was bound to achieve rapid growth in the future," Wang said. "Moreover, most of the preferential policies I learned about at that time have now been implemented."

Earlier this year, the Ministry of Finance and the State Taxation Administration issued a notice stating that by Dec 31, 2027, for high-end and in-demand talent working in the Hainan FTP, the portion of personal income tax exceeding 15 percent will be exempted.

"For high-end talent, the percentage of personal income tax rises as income increases. The 15 percent tax relief is therefore very attractive," Wang added.

To meet the high-throughput, low-power consumption and wireless transmission needs when developing brain-computer interfaces, SensingX has broken through multiple technical bottlenecks. At present, chips designed by the company are being tested by more than 30 downstream enterprises and more than a dozen have completed testing and placed orders.

Guo Zheshan, another co-founder of the company, said that the research, development and production of its brain-computer interface chips and equipment require importing large quantities of raw materials and high-end equipment from overseas.

Currently, the Hainan FTP exempts tariffs on the entry of these raw materials and equipment. In addition, goods processed in the Hainan FTP that achieve or exceed a 30-percent value-added rate are exempt from tariffs when entering the mainland from the port. This gives Hainan-based enterprises a significant cost advantage in domestic sales, Guo explained.

After the island-wide special customs operations of Hainan FTP, various shipping procedures will be simplified. Zero-tariff goods will be able to circulate freely among eligible entities, greatly reducing cooperation costs between upstream and downstream enterprises, Guo noted.

The island-wide special customs operations launched on Thursday mark a "critical leap", said Cui Fan, a professor at the University of International Business and Economics. After the special customs operations, the proportion of zero-tariff commodity tax items will rise sharply from 21 percent to 74 percent. This represents a substantive change and can be regarded as a milestone in the initial establishment of the policy and institutional system of the Hainan FTP.

Hainan's continued efforts to raise its level of opening-up not only position it at the forefront of higher-level opening-up nationwide, but also create more opportunities for neighboring countries and regions, especially ASEAN members, Cui added.

To attract foreign talent to settle in the YZBSTC, Bob Dejkam, a talent manager at YZBSTC, said they are working to simplify the entire application process for international professionals. For tax incentives and entrepreneurship support, YZBSTC provides one-on-one guidance, helps applicants prepare documents and connects them directly with government departments.

"We also offer different levels of support based on talent type. For example, top scientists can receive project funding and customized research platforms, while others receive fast-track work permits and targeted services. This helps us match each professional with the most suitable resources," Dejkam said.

Bob Dejkam, a talent manager at YZBSTC, introduces talent policies to visitors. CHINA DAILY

An aerial view of YZBSTC. CHINA DAILY