On April 13, 1988, with the approval of the 7th National People's Congress, Hainan, formerly a part of Guangdong province, was declared the nation's newest province by the Chinese government. 

At the same time, the new province of Hainan was also granted status as the country's fifth special economic zone (SEZ). To this day it remains the largest of all China's seven SEZs.

The move was publicly hailed as another major step by the Chinese government toward opening to the outside world. It is also an important part of the strategy for developing an export-oriented economy in China's coastal areas.

The island has gained a reputation both domestically and internationally as a holiday hotspot, for its beautiful beaches and tropical climate, and it continues to grow and develop as an economic frontrunner. 

On June 1, 2020, the Chinese government announced a large-scale plan to build the southern island province into a globally-influential high-level free trade port by the middle of the century.

Hainan's GDP stood at 553.2 billion yuan ($85.6 billion) in 2020, an increase of 3.5% year-on-year, according to an official at the Hainan Provincial Bureau of Statistics.

According to a government report, Hainan will make good use of the offshore duty-free policy and strive to achieve duty-free sales of over 60 billion yuan (about $9.26 billion) in 2021.