(Yicai Global) July 28 -- Southern China's Hainan province cold surpass South Korea as the world's biggest offshore duty-free market in the next three years, according to an industry report.

If Hainan can improve the penetration rate of duty-free shopping and boost client purchases, the related market is expected to exceed CNY160 billion (USD23.7 billion) by 2025, the China Hainan Institute for Reform and Development and the China Institute for Free Trade Ports with Chinese Characteristics wrote in a report published yesterday during the second China International Consumer Products Expo in Haikou.

China should promote the establishment of service management systems for duty-free consumption to make Hainan the largest duty-free consumer market worldwide in the medium and long term, the report said.

Luxury is becoming more accessible. The country's personal luxury goods market is likely to rebound to the levels seen in 2021 by late this year or early next year as more people eye upscale products amid developments involving digitalization and the Hainan free trade port, Bain & Co. wrote in a report on July 26.

The CICPE, also known as the Haikou Expo, is open till July 30. The event attracts over 2,800 brands from home and abroad. More than 600 new products are expected to make their debuts during the five-day expo.

Duty-free shops in the island province have seen their business volumes peak in the summer months. A long line of people was seen waiting to get hold of cosmetics products from Chanel, Lancome, and Estee Lauder, as well as watch brands Vacheron Constantin and Cartier at the Haikou Meilan-Sun Moon Plaza Duty-Free Shop during the expo.

Last year, Hainan's 10 duty-free shops made CNY60.2 billion (USD8.9 billion) in revenue while their duty-free sales almost doubled to CNY50.5 billion. The most popular category of items was cosmetics, followed by watches and jewelry.

Editor: Emmi Laine, Xiao Yi