At the Hongqiao International Economic Forum of the 7th China International Import Expo held on November 6, Wu Jincheng, Deputy Secretary General of Shanghai Municipal People's Government and Deputy Secretary of the Party Committee and Mayor of Pudong New Area, said that the Oriental Hub International Business Cooperation Zone (IBCZ), which is located in Pudong, will soon launch a “30-day visa-free + 30-day extension” policy in 2025, which will significantly boost the development of international business and tourism, bringing new opportunities and challenges for the financial sector. This will significantly boost international business and tourism, bringing new opportunities and challenges to the financial sector.

By 2023, Pudong's GDP reached over US$230 billion, its industrial output value was US$190 billion, its import and export foreign trade volume reached US$360 billion, and it attracted about US$10 billion of foreign investment annually. As an important window for China's reform and opening up, Pudong New Area has been committed to attracting foreign investment and promoting international trade and is also a hot spot for global capital investment, which continues to fuel Pudong New Area's economic growth. As one of the biggest beneficiaries, enterprises may face the following potential economic impacts:

 1.  Promotion of international business cooperation.

Enterprises will be able to more easily conduct business negotiations and cooperation with international partners, which may lead to new sources of revenue and profit growth. The finance department will need to assess these opportunities and consider the potential benefits and risks in their financial planning.

 2.  Increased tourism and business revenues.

The visa-free policy will attract more foreign travelers and businesspeople to visit Pudong, which will lead to increased revenues from hotels, restaurants, transportation and tourism services. Businesses will need to prepare their financial budgets accordingly to cope with the increased business volume and possible capital expenditure.

 3.  Increased requirements for financial reporting and compliance.

More international business means more stringent financial reporting and compliance requirements. Businesses must ensure that their financial systems can adapt to international accounting standards and meet the tax reporting requirements of different countries.

  4.  Increased financial complexity of cross-border transactions.

As international exchanges increase, cross-border transactions and financial flows will become more frequent. Enterprises will need to strengthen foreign exchange management, optimize international payment processes and ensure compliance with relevant international tax regulations.

Pudong's visa-free policy has created new opportunities and challenges in the finance sector. Enterprises need to adapt to this change by strengthening financial planning, optimizing funds management, enhancing compliance capabilities, and leveraging technology to improve efficiency, in order to fully utilize the benefits of this policy.

PHC Advisory is a company of  DP Group: an international professional services conglomerate of companies with approximately 100 experienced professionals worldwide. We offer comprehensive services in tax, accounting, and financial consulting, including financial supervision, financial audit, internal audit, internal control over financial reporting, and support for audited financial statements and annual audits, ensuring clients' financial transparency and compliance. 

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The content of this article is provided for informational purposes only, financial advice must be tailored to the specific circumstances on a case-by-case basis, and the contents of this article do not legally bind PHC Advisory with the reader in any way. 

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