[SMM Analysis: Impact on Solid-state Batteries of the Ministry of Commerce Adding 10 US Entities to the Export Control List] On June 22, 2026, the Ministry of Commerce issued an announcement and, effective immediately, formally implemented the "Export Control List (June 22, 2026)," which includes 10 US entities. This export control measure has almost no direct impact on China's solid-state battery industry, but attention should be paid to the indirect link of the rare earth supply chain. (1) China already has export controls on high-end batteries with an energy density exceeding 300 Wh/kg (including semi-solid and all-solid-state), and this measure targeting specific entities is an extension of the existing control framework rather than a new restriction specifically aimed at the solid-state battery industry. (2) The solid-state battery industry is still in the development stage and has not yet generated a significant export demand.

Committee Strengthens Carbon Border Adjustment Mechanism, Adds 180 Downstream Products Recently, we conducted a retrospective analysis of the EU's import quota policy (for details, please refer to ). On December 17, the European Commission further proposed to strengthen and expand the Carbon Border Adjustment Mechanism (CBAM). The newly announced CBAM details, while maintaining the core framework, make the mechanism more stringent, clear, and feasible through an extended transition period, tightened accounting rules, and refined operational requirements. CBAM is a key policy tool for the EU to achieve its 2050 climate neutrality goal, aimed at preventing "carbon leakage" and aligning with the Paris Agreement's emission reduction commitments. Its core mechanism involves levying fees on non-EU producers based on the carbon emissions during the production process when goods enter the EU market. This harmonizes with the EU's Emissions Trading System (ETS) to ensure a fair competitive environment in terms of carbon costs. The mechanism entered a transition phase in October 2023. According to the latest proposal, the substantive financial impact of CBAM will gradually become apparent from January 1, 2026, in tandem with the phased elimination of free allowances under the EU ETS. Committee Strengthens Carbon Border Adjustment Mechanism Data Source: European Commission, SMM Research and Compilation. Changes in the New Rules Have Direct Impacts on All Stakeholders For EU Importers: Extended Action Window, Higher Compliance Thresholds. The transition period is extended to the end of 2026, giving companies more time to establish data collection and management systems that meet CBAM's stringent reporting requirements. For Third-Country Producers (e.g., Chinese Export Enterprises): Cost Structures Will Be Under Pressure, Low-Carbon Transition Becomes Core to Competitiveness. Enterprises need to gain a deep understanding of CBAM accounting rules, calculate potential additional costs, and consider improving production processes to reduce carbon emissions. For All Stakeholders: Details Determine Compliance, Proactive Follow-Up and Utilization of Support Are Essential. Closely monitor the release of technical implementation details and leverage the guidance and support provided by the EU during the transition period. However, as CBAM's Full Implementation Approaches, Industry Groups Like the European Steel Association Still Have Concerns Specific viewpoints include: The EU's current export response policies remain fragmented, lacking structural planning. The currently proposed measures not only have a short validity period (set for just two years) but also cover a narrow range of products (less than one-quarter of steel exports). Moreover, the funding sources for the transitional decarbonization fund are highly uncertain. Without a long-term, comprehensive strategy, EU steel producers may continue to face competitive disadvantages in the global market. While the European Commission has correctly identified the risks of circumvention (including "resource shifting") and recognized that if left unchecked, it could lead to speculative behavior focused on "creative emission accounting" rather than actual emission reductions, this is commendable. However, the proposed countermeasures raise doubts about their timeliness and effectiveness, as they fail to propose strong immediate deterrents and only mention possible remedial measures in future implementation details, which are not enough to address imminent risks. Additionally, including pre-consumer scrap within the scope of CBAM (initially a demand from an aluminum company), may have unexpected negative chain reactions on the steel industry. Regarding downstream industries, the committee only proposes a very limited expansion of CBAM coverage to a few downstream products. While this is a step in the right direction, it is far not enough to comprehensively protect many downstream industries facing carbon leakage risks, potentially creating loopholes in the current value chain, and even generating new risk points. "We sincerely appreciate the ongoing cooperation between the European Commission and the steel industry in implementing the Steel and Metals Action Plan (SMAP). However, good intentions alone are not sufficient. Without structural solutions, CBAM may backfire, further penalizing European steel manufacturers and their customers who are striving to decarbonize in a challenging geopolitical economic environment. In such an environment, overcapacity, high energy prices, and unfair trade practices do not allow for any mistakes. We are ready to further discuss with legislators how to make CBAM fully effective and truly beneficial to our value chain." —Axel Eggert, Director General of the European Steel Association Widespread Industry Concerns Are Evident, as the European Steel Market Struggles in the First Three Quarters of This Year Data Source: World Steel Association, SMM Research and Compilation. In Q3 2025, the EU steel market was already under a sense of crisis due to weak demand, high energy costs, and competition from cheap imported products. Announcements of temporary shutdowns, unexpected accidents, and prolonged production interruptions by steel enterprises further exacerbated the situation. For example, ✔ ThyssenKrupp decided to temporarily shut down Blast Furnace No. 9 due to weak demand and excess imports. In Q3 2025, ThyssenKrupp reported a net loss of 255 million euros, significantly higher than the 63 million euro loss in the same period last year. ✔ Voestalpine released its H1 2025/26 financial results: revenue dropped to 7.6 billion euros, down 5.6% YoY, affected by US tariff pressures, low steel prices, and weak global demand. The company expects the economic environment to remain challenging in the coming months and plans to reduce capacity at its Kindberg and Mürzzuschlag plants while advancing the restructuring of its automotive parts and high-performance metals divisions. Specifically, Europe's crude steel production was 41.6 million mt, down 4% from Q2 (43.24 million mt). Italy and Spain saw the largest declines in crude steel production, reflecting the ongoing economic uncertainty and weak demand in both countries; followed by the UK, France, and Germany. From January to September, Germany's steel production fell 10.7% YoY to 25.4 million mt. However, Turkey's crude steel production showed a slight increase. In September 2025 alone, its production reached 3.2 million mt, up 7.2% YoY. This brought its total production from January to September to 28.1 million mt, up 1% YoY. This growth trend is driven by several key factors: the active advancement of infrastructure projects (especially post-earthquake reconstruction), growing export demand in the changing global market, and the continuous modernization of the metallurgical industry. Summary Whether it is the deep concerns of industry bodies like the European Steel Association regarding the implementation details or the actual difficulties faced by the European steel industry amid weak demand and high costs, these all highlight that the full implementation of CBAM still faces significant challenges. However, this mechanism has irreversibly shifted the competitive rules of global steel trade from the traditional two-dimensional plane of price and quality, to a three-dimensional space encompassing price, quality, and carbon footprint. In this new paradigm, being the first to account for, manage, and optimize product carbon footprints and strategically position oneself is undoubtedly the key prerequisite for responding to future changes and building a competitive advantage. CBAM Has Moved from Legislative Framework to Substantive Operational Phase The core documents of this version can be found at the following link: Overview of the Core Documents Released This Time SMM Black Consulting Services Leveraging its understanding of the global steel industry chain and regional markets, along with a robust industry database and network, SMM provides upstream, midstream, and downstream consulting services to clients. 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On October 8, 2025, International Hydrogen Energy Day, Shanghai Hydrogen Sharp Technology Co., Ltd. (hereinafter referred to as "Shanghai Hydrogen Sharp") announced that its EU CE-certified MW-scale PEM hydrogen production equipment has gone global, shipped to a project site under South Africa's national power company ESKOM. This marks the first time that MW-scale PEM hydrogen production equipment manufactured in China has been exported overseas. The product meets the demands of fluctuating operation scenarios in PV hydrogen production, featuring high integration, automation, and low energy consumption. The high-purity hydrogen (Purity: 99.999%, Dew point: -75 °C) is primarily used for the hydrogen-cooled generator systems in thermal power plants, with the remainder supplied via park pipelines to nearby chemical enterprises, signifying an important advancement in the industrial application of domestically produced MW-scale PEM hydrogen production equipment. Shanghai Hydrogen Sharp's MW-scale PEM hydrogen production skid-mounted system adopts an "All-in-One" modular and series design. The product has successfully passed EU CE certification, with its safety, reliability, and operational requirements fully complying with the stringent usage conditions of power and chemical enterprises and the risk management standards for the hydrogen production process. Hu Dalin, Deputy General Manager of Shanghai Hydrogen Sharp, stated: "We are very pleased to provide tailored solutions for South Africa's national power company ESKOM. Hydrogen for power plant cooling is a market with clear demand and extremely high requirements. Our RYZER® system not only produces hydrogen that meets high-purity standards (Purity: 99.999%, Dew point: -75°C) but also, with its high degree of automation and safety design, perfectly aligns with the power plant's need for continuous and fluctuating 7 x 24-hour operation. The successful cooperation with the South African power plant sets a benchmark, delivering economic benefits and high reliability to the customer while ensuring safety at the user's site, laying a solid foundation for the continued expansion of the overseas market." Advantages of Core Parameters of the RYZER® Series PEM Hydrogen Production System: High Hydrogen Purity : It meets the long-term supply requirement for high-purity hydrogen of 99.999% and a dew point of -75°C, exceeding the usage standards for generator hydrogen cooling systems and effectively protecting precision power generation equipment. Wide Fluctuation Operation : The system operates within a range of 10% to 120%, enabling continuous and fluctuating operation in response to changes in electricity prices and downstream demand, bringing tangible benefits to users. Safety Assurance : Integrated multiple active and passive safety measures, certified by HAZOP and CE, ensuring absolute safety in power plant environments. Under low-load power, the hydrogen concentration in oxygen is Economic Efficiency : Measured DC power consumption of 4.04 kWh/Nm³H₂. Compared to externally purchased hydrogen, it demonstrates significant cost advantages throughout the life cycle. From successful overseas bidding—design process review—material certification and production supervision—to final factory performance and 7-day operational test acceptance, this marks Shanghai Hydrogen Ruite's recognition in the international market for high-end industrial PEM hydrogen production, showcasing the international image and quality of "Made-in-China." About Shanghai Hydrogen Ruite Technology Co., Ltd.: Shanghai Hydrogen Ruite Technology Co., Ltd. was established in 2022. Its core technology and management team are derived from the Shanghai Advanced Research Institute of the Chinese Academy of Sciences and talents from the hydrogen energy sector of Fortune 500 companies. The company specializes in the R&D, industrialisation, application, and solutions for PEM water electrolysis hydrogen production, meeting the requirements for high reliability, long lifespan, high efficiency, and adaptability to fluctuating power supply input as proposed by the National Energy Administration. The company possesses production lines for "roll-to-roll membrane electrodes, highly uniform titanium felt coating, serialised electrolyser assembly, and modular hydrogen production system integration." It has the capability to supply large-size membrane electrodes and a series of products for 2–500 Nm ³ H ₂ /h PEM water electrolysis hydrogen production stacks and systems, with an annual capacity exceeding 200 MW. Key technical indicators are at internationally leading levels, and multiple products have passed EU CE certification. The company has applied for/been granted over 20 patents (including 2 PCT patents) and has received honors such as National High-Tech Enterprise, Shanghai Specialised, Refined, Unique, and New Enterprise, and Shanghai Technological Innovation Enterprise.

On October 8, 2025, International Hydrogen Energy Day, Shanghai Qingrui Technology Co., Ltd. (hereinafter referred to as "Shanghai Qingrui") announced that its EU CE-certified MW-scale PEM hydrogen production equipment had been shipped to a project site under South Africa's national power company, ESKOM, marking the first time that Chinese-made MW-scale PEM hydrogen production equipment has gone global. The product meets the demands of fluctuating operation scenarios for PV hydrogen production, featuring high integration, automation, and low energy consumption. The high-purity hydrogen (Purity: 99.999%, Dew point: -75 °C) is primarily used for the hydrogen-cooled generator systems in thermal power plants, with the remainder supplied via park pipelines to nearby chemical enterprises, signifying an important advancement in the industrial application of domestically produced MW-scale PEM hydrogen production equipment. Shanghai Qingrui's MW-scale PEM hydrogen production skid-mounted system adopts an "All-in-One" modular and series design. The product has successfully passed EU CE certification, with its safety, reliability, and operational requirements fully complying with the stringent usage conditions of power and chemical enterprises and the risk management standards for the hydrogen production process. Shanghai Qingrui Deputy General Manager Hu Dalin stated: "We are very pleased to provide tailored solutions for South Africa's national power company, ESKOM. Hydrogen for power plant cooling is a market with clear demand and extremely high requirements. Our RYZER® system not only produces hydrogen that meets high-purity standards (Purity: 99.999%, Dew point: -75°C) but also, with its high degree of automation and safety design, perfectly aligns with the power plant's need for continuous and fluctuating 24/7 operation. The successful cooperation with the South African power plant is of benchmark significance, delivering economic benefits and high reliability to the customer while ensuring safety on-site, laying a solid foundation for continued expansion into overseas markets." Advantages of Core Parameters of the RYZER® Series PEM Hydrogen Production System: High Hydrogen Purity: Long-term supply of high-purity hydrogen with 99.999% purity and a dew point of -75°C, exceeding the usage standards for generator hydrogen cooling systems, effectively protecting precision power generation equipment. Wide Fluctuation Operation: The system operates within a range of 10% to 120%, providing continuous and fluctuating operation in response to changes in electricity prices and downstream demand, delivering tangible benefits to users. Safety Assurance: Integrated multiple active and passive safety measures, certified by HAZOP and CE, ensuring absolute safety in power plant environments; hydrogen concentration in oxygen is Economic Efficiency: Measured DC power consumption of 4.04 kWh/Nm³H₂. Compared to externally purchased hydrogen, the system offers significant cost advantages over its full life cycle. From successful overseas bidding to design process review, material certification and production supervision, and finally to factory performance and 7-day operational test acceptance, this series of achievements signifies that Shanghai Hydrogen Ruite has gained recognition in the international market for high-end industrial PEM hydrogen production, and also showcases the international image and quality of "Made-in-China". About Shanghai Hydrogen Ruite Technology Co., Ltd.: Shanghai Hydrogen Ruite Technology Co., Ltd. was established in 2022. Its core technology and management team are composed of talents from the Shanghai Advanced Research Institute of the Chinese Academy of Sciences and global Fortune 500 companies in the hydrogen energy sector. The company specializes in the R&D, industrialisation, application, and solutions for PEM water electrolysis hydrogen production, meeting the requirements for high reliability, long lifespan, high efficiency, and adaptability to fluctuating power supply input for water electrolysis hydrogen production equipment as proposed by the National Energy Administration. The company possesses production lines for "roll-to-roll membrane electrode, highly uniform titanium felt coating, serialised electrolyser assembly, and modular hydrogen production system integration." It has the capability to supply large-size membrane electrodes and a series of products for 2~500 Nm³H₂/h PEM water electrolysis hydrogen production stacks and systems, with an annual capacity exceeding 200 MW. Its core technical indicators are at the internationally leading level, and multiple products have obtained EU CE certification. The company has applied for/been granted over 20 various patents (including 2 PCT patents), and has received honors such as National High-Tech Enterprise, Shanghai Specialised, Refined, Distinctive, and New Enterprise, and Shanghai Technological Innovation Enterprise.

On August 4, the General Office of the Hainan Provincial People's Government issued the Notice on Printing and Distributing the Three-Year Action Plan for Accelerating the Construction of a Modern Industrial System with Distinctive Features and Advantages in Hainan Province (2025-2027). The document specifies efforts to expand the marine new energy industry by planning and promoting integrated demonstration projects for offshore wind power-based hydrogen and alcohol production and refueling. It aims to develop specialized marine engineering equipment industries, enhance deep-sea oil and gas equipment testing capabilities, and promote local production of drilling instruments, subsea Christmas trees, and high-value-added oilfield service products. Additionally, it seeks to boost marine technological innovation capabilities, establishing Hainan as a hub for "Smart Ocean" deep-sea technological innovation and a testing, pilot-scale, and production service platform. The plan supports Haikou in fostering green manufacturing industrial clusters focusing on NEVs, environmental protection, and plastic ban sectors. Leveraging offshore wind resources along the western ring of the island, it aims to vigorously develop offshore wind power, striving to achieve an output value exceeding 12.5 billion yuan for the Changjiang clean energy industrial cluster by 2027, with clean energy installed capacity accounting for over 87% of the province's total. The policy details are as follows: Notice of the General Office of the Hainan Provincial People's Government on Printing and Distributing the Three-Year Action Plan for Accelerating the Construction of a Modern Industrial System with Distinctive Features and Advantages in Hainan Province (2025-2027) Qiong Fu Ban [2025] No. 36 To the People's Governments of Cities, Counties, and Autonomous Counties, and Directly Affiliated Units of the Provincial Government: The Three-Year Action Plan for Accelerating the Construction of a Modern Industrial System with Distinctive Features and Advantages in Hainan Province (2025-2027) has been approved by the Provincial Party Committee and Provincial Government and is hereby issued to you for earnest implementation. General Office of the Hainan Provincial People's Government July 28, 2025 (This document is proactively disclosed) Three-Year Action Plan for Accelerating the Construction of a Modern Industrial System with Distinctive Features and Advantages in Hainan Province (2025-2027) To fully implement General Secretary Xi Jinping's important speeches and instructions on Hainan's work, this plan aims to build Hainan into a key practice base for new quality productive forces, aligned with the strategic positioning of the Hainan Free Trade Port as "three zones and one center." It focuses on cultivating and expanding high-tech, high-efficiency, and high-quality characteristic industries represented by three future industries and tropical high-efficiency agriculture, while upgrading and enhancing intelligent, green, and integrated advantageous industries such as tourism, modern services, and high-tech industries, thereby promoting industrial chain extension and optimization. I. Overall Objectives By 2027, the added value of the four leading industries will account for approximately 70% of GDP, further strengthening their role in supporting high-quality economic development. The construction of an international tourism consumption center will advance, continuously unleashing tourism consumption potential. The integration of producer services with advanced manufacturing industries has accelerated, while consumer services have been optimized and upgraded towards higher quality and diversity. The added value of modern service industries now accounts for nearly 30% of GDP. Scientific and technological innovation has been deeply integrated with industrial innovation, with the aim of achieving an R&D investment intensity of 1.8% in the province by 2027, and the added value of high-tech industries accounting for over 17% of GDP. Tropical characteristic and efficient agriculture has formed a collaborative development pattern of "connecting the secondary and tertiary industries", with the annual growth rate of the added value of the entire industry chain of agricultural characteristic leading industries exceeding 5%. II. Characteristic Industry Cultivation Initiative Based on resource endowments, we will fully leverage the comparative advantages of climate temperature, ocean depth, and geographical latitude to continuously cultivate and expand three future industries: seed industry, deep-sea industry, and aerospace industry. We will also expand and strengthen tropical characteristic and efficient agriculture, and cultivate a number of characteristic industry clusters. (1) Develop and expand the new quality productive forces in the seed industry. Accelerate the construction of the "Nanfan Silicon Valley" and vigorously develop the Nanfan industry of "seed sources, seed industry, and seed market". Actively align with national strategies in basic and cutting-edge research in the seed industry, build major scientific research facility platforms focusing on biotechnology, artificial intelligence, and big data computing, and actively introduce national-level seed industry scientific and technological innovation platforms, and scientific research and teaching institutions. Implement the seed industry revitalization initiative in depth, and accelerate the breakthrough of a number of breakthrough varieties. Cultivate and expand new biotechnology breeding industries, build a number of advantageous seed industry enterprises, and strengthen the CRO enterprises in the Nanfan seed industry that provide scientific research services. By 2027, the operating revenue of the Yazhou Bay modern seed industry cluster will exceed 20 billion yuan. (2) Promote the high-quality development of the deep-sea industry. Guided by the urgent needs of major national strategies and taking the construction of a shared intelligent manufacturing platform as a breakthrough point for industrialization, we will accelerate the construction of a modern marine industry system and achieve the goal of recreating a "marine Hainan". Cultivate and expand emerging marine industries, accelerate the increase in reserves and production of marine oil and gas minerals, conduct potential evaluations of "multi-gas co-production and multi-energy utilization" in key areas, and research and develop key technologies for deep-sea oil and gas field development. Actively promote the productive trial production of natural gas hydrates in key sea areas. Expand the marine new energy industry, plan and promote the integrated demonstration project of offshore wind power hydrogen and alcohol production and refueling. Develop characteristic marine engineering equipment industries, improve the testing capabilities of deep-sea oil and gas equipment, and promote the local production of drilling instruments, underwater Christmas trees, and high value-added oil service products. Enhance marine scientific and technological innovation capabilities, and build a "smart ocean" deep-sea scientific and technological innovation source, testing, pilot production, and productive service platform. By 2027, the operating revenue of the deep-sea science and technology industry cluster in Sanya Yazhou Bay Science and Technology City will exceed 6 billion yuan. (3) Accelerate the cultivation of the entire industry chain of commercial aerospace. We will focus on cultivating the aerospace industry cluster in the Wenchang International Aerospace City, building major scientific and technological innovation bases for aerospace, and expanding the rocket, satellite, and data chains. We will promote the enhancement of the core capabilities of commercial space launch sites and accelerate the construction of Phase II and supporting facilities for commercial space launch sites. We will advance the construction of satellite super factories, commence the construction of projects such as satellite component manufacturing centers and rocket large-section manufacturing centers, actively introduce commercial aerospace enterprises to establish assembly and testing capabilities, and promote the integrated development of satellites, rockets, and launch sites. We will leverage the leading role of industry giants and rely on innovation carriers and platforms such as the Hainan Satellite Data and Application Research Center and the Hainan Aerospace Technology Innovation Center to carry out technological breakthroughs, and the application and commercialization of research outcomes. By 2027, the operating revenue of the aerospace industry cluster in the Wenchang International Aerospace City is expected to reach 10 billion yuan. (IV) Promoting the Extension and Expansion of Tropical Specialty and High-Efficiency Agriculture Chains. Strengthen the specialty industry chains for mangoes, pineapples, Wenchang chickens, East Star Groupers, winter vegetables and fruits, coffee, pepper, rubber, and agarwood. Cultivate "small but exquisite" specialty industries such as Shanlan rice, pandan, and large-leaf tea, and actively introduce, cultivate, and promote "new, unique, and excellent" varieties. Support the development of fisheries in a park-based, large-scale, and eco-friendly manner, and build modern fisheries industrial parks such as Wenchang Fengjiawan to high standards. Promote the integrated development of fruit and vegetable cleaning, sorting, pre-cooling, preservation, drying, storage, and product packaging, and strengthen the application of processing and value-added policies in industries such as grains and oils, meat, and nuts. Deepen brand building and cultivate Hainan agricultural product brands relying on the "Hainan Fresh" platform. By 2027, the output value of the Haikou high-end food processing industry cluster and the Ding'an Taling tropical food processing industry cluster is expected to exceed 10 billion yuan, and that of the Laocheng Science and Technology New City agricultural and sideline food processing industry cluster is expected to reach 14 billion yuan. III. Action Plan for Enhancing Competitive Industries Guided by tourism, modern services, and high-tech industries, we will optimize the supply of tourism products, expand industries such as port and shipping logistics and modern finance, focus on "three articles on overseas consumption repatriation", improve industries such as petrochemical new materials, green and low-carbon development, and the digital economy, and build competitive industries in Hainan. (V) Optimizing the Supply of Tourism Products. We will deepen the integrated development of "X + tourism", improve space tourism, high-end health and wellness tourism, tropical rainforest tourism, and Li and Miao cultural tourism, vigorously develop new consumption formats such as performing arts tourism, sports tourism, and silver-haired tourism, plan high-quality tourism projects, actively connect with well-known international cultural and tourism IPs, form a clustering effect of "large projects driving large consumption", and build core carriers for international tourism and consumption centers. We will deepen the construction of product systems for the island-circling tourism highway and the tourism highway around the Tropical Rainforest National Park. Actively cultivate world-class tropical coastal tourism resorts and strive to create high-level tourism core attractions. We will support Sanya and Lingshui in building an entire industry chain for film and television short dramas. By 2027, the operating revenue of the leisure tourism industry cluster in Sanya Haitang Bay will exceed 50 billion yuan, the number of inbound tourists in the province will reach 2.3 million, and 160 overseas routes will be opened. (6) Strengthen the upgrading of the port-adjacent industry's capacity. We will support Yangpu Port in becoming a regional international container hub port and promote it to become an important node for China's trade network with RCEP countries and the linkage of the New International Land-Sea Trade Corridor's domestic and foreign trade networks. We will accelerate the expansion and upgrading of the navigation capacity of the Qiongzhou Strait and upgrade the old vessels in the Qiongzhou Strait. We will accelerate the coordinated development of Yangpu's "port-adjacent industry cluster + port-adjacent logistics park," support Yangpu in carrying out the "international centralised procurement + processing value-added + domestic distribution" business for bulk commodities. We will study and promote the opening of a ro-ro shipping route from Basuo Port to Vietnam and accelerate the construction of the Gaopai Port Area of Basuo Port. By 2027, the operating revenue of Yangpu's port and shipping industry cluster will reach 80 billion yuan; the province's container throughput will reach 6 million TEUs, and 85 container liner routes will be in stable operation. (7) Carry out pilot financial reforms. We will promote the expansion of the pilot program for EF accounts and enhance the convenience of cross-border capital flows in the Hainan Free Trade Port. We will actively strive to implement the pilot policy for cross-border asset management, support the clustered development of cross-border capital centralized operation centers, and accelerate the construction of the Hainan Free Trade Port's cross-border capital monitoring platform (Phase II). We will precisely release the policy dividends of the substantive operation recognition policy for SPVs in aircraft and ship leasing, attracting financial leasing and financing leasing companies to operate in Hainan. By 2027, the asset management amount of the modern financial industry cluster in Sanya's Central Business District will approach 600 billion yuan. (8) Do a good job in "three articles on the return of overseas consumption." We will win the initiative in duty-free shopping, promote the optimization of the off-island duty-free policy, and expand the catalog of "purchase on the spot and take away" commodities. We will enhance the "Study in Hainan" brand, continuously attract high-quality overseas educational resources, build core competitiveness in the "1+3+N" disciplines and majors, and strive to reach 18,000 teachers and students in Lingshui Li'an International Education Innovation Pilot Zone by 2027. We will accelerate the return of overseas medical consumption, continuously promote the in-depth and practical implementation of the pilot work on the application of clinical real-world data, strive to have 2-4 real-world research pilot products approved for domestic listing each year, and strive to introduce no less than 40 international innovative drugs and medical devices each year. By 2027, the number of medical tourists will exceed 1.5 million. (9) Upgrade the quality of the petrochemical and new materials industry. We will fully leverage the policy dividends of "fixed enterprises, fixed varieties, and fixed quantities" for crude oil imports, promote the mutual supply and circulation of materials upstream and downstream of the industry chain, and accelerate the formation of a complete industry chain from "crude oil head - chemical body - new materials tail." We will expand the olefin industry chain, plan to purchase externally naphtha, propane, and other raw materials to expand the scale of the olefin industry, and develop the high-end chemical and new materials industry in a differentiated manner. We will steadily develop the aromatic hydrocarbon industry chain, extending downstream to special polyesters and biodegradable materials. We will moderately develop special oil products. We will promote the comprehensive utilization of natural gas with high carbon dioxide content and strengthen the natural gas chemical industry chain. By 2027, the output value of the province's petrochemical and new materials industry will exceed RMB 160 billion. (10) Develop and strengthen green and low-carbon industries. We will accelerate the construction of green factories and green parks to enhance the competitiveness of product carbon footprints. We will support the coordinated transformation of digitalization and greening, actively cultivating national-level green factories and benchmark enterprises for digital transformation. We will promote Lingao to build a full industry chain for new-type buildings encompassing "design - R&D - manufacturing - trading". By 2027, the output value of Lingao's new-type building industry cluster will reach RMB 6 billion. We will support Haikou in cultivating green manufacturing industry clusters in areas such as NEVs, energy conservation and environmental protection, and plastic ban. We will rely on the offshore wind power resources along the western ring of the island to vigorously develop offshore wind power, striving to exceed RMB 12.5 billion in the output value of Changjiang's clean energy industry cluster by 2027, with the installed capacity of clean energy in the province exceeding 87%. (11) Build an innovation hub for the digital economy. We will promote the transformation of the Haikou Fuxingcheng Digital Economy Industry Cluster and the Hainan Eco-Software Park Digital Economy Industry Cluster towards innovation-driven and application-driven development. We will accelerate the layout of the computing power industry, speed up the cultivation of the data element market, promote the safe and orderly flow of data, and build core competitiveness in digital application scenarios. Based on blockchain, AI, and big data technologies, we will promote the upgrading of digital health, digital entertainment, sharing platforms, and other business formats, and actively layout industries such as game globalization, data processing, semiconductor chips, and integrated circuits. We will promote the integration of digital and real economies by leveraging the digital transformation of enterprises in fields such as petrochemical and new materials, modern biopharmaceuticals, high-end food processing, and equipment manufacturing. By 2027, the operating revenue of the province's core digital economy industries will reach RMB 220 billion. IV. High-Quality Development Actions for Key Parks We will strengthen the supporting role of key parks in building a modern industrial system, improve the planning for the "15th Five-Year Plan" of key parks, fully build modern industrial clusters, optimize the management model and investment and financing mechanisms of industrial parks, accelerate the integration of industry and city, strengthen the attraction of major projects, the cultivation of leading enterprises, and the upstream and downstream collaboration of the industry chain, and strive to build our province's key parks into demonstration and leading zones for the high-quality development of the Hainan Free Trade Port. (12) Cultivate and expand industrial clusters. We will focus on "five directions for strength" to cultivate industrial clusters with distinct characteristics, complete supporting facilities, and strong competitiveness, enhancing the "newness", "greenness", and "value" of industrial clusters. We will focus on supporting the cultivation of industrial clusters in areas such as offshore wind power, energy conservation and environmental protection, low-altitude economy, modern logistics, artificial intelligence, bio-manufacturing, modern fisheries, medical and health care, inspection and testing, and deep processing of tropical foods. By 2027, the driving role and influence of industrial clusters will be further enhanced, with 30 key industrial clusters each exceeding 10 billion yuan cultivated cumulatively. (13) Innovating Park Investment and Financing Mechanisms. Explore the establishment of provincial-level industrial park investment companies, flexibly utilizing investment, financing, and capital management operations to support the development of key parks in the free trade port. Support qualified key parks in issuing financial products such as real estate investment trust funds or asset-backed securities. Fully leverage the role of special bonds in leveraging social capital, and encourage eligible projects to use special bonds as project capital. (14) Promoting Integrated Industrial-Urban Development. Support the improvement of production and living infrastructure projects such as the "Five Networks," environmental protection and firefighting facilities, schools, and hospitals. For projects meeting relevant conditions, provincial and municipal finances will provide key support from local government special bonds and other sources. Support multi-channel increases in housing supply to promote job-housing balance. Affordable housing built within key parks can be prioritized for sale to eligible talents. (15) Strengthening the Investment Attraction Role of "Chain Leaders." Leverage the driving role of major "chain leader" enterprises in key industry chains to promote coordinated development of upstream and downstream enterprises in the industrial chain. Conduct multiple rounds of "business-led investment" and "chain-led investment" activities, form elite investment teams, and establish continuous tracking and engagement mechanisms to precisely attract landmark, leading, and exemplary industrial projects, continuously enhancing the competitiveness of Hainan Free Trade Port's industrial chains. Utilize policies supporting headquarters economic development to actively attract Fortune 500 companies to establish headquarters in key parks. V. Safeguard Measures (16) Strengthening Organizational Leadership. Relevant departments and municipalities should enhance organizational leadership, incorporating the construction of a modern industrial system with Hainan characteristics and advantages, as well as the development of parks, into key agendas. Industry authorities should focus on introducing new elements and optimizing existing ones in key industrial chains, vigorously attracting landmark and leading industrial projects to provide stronger support for building a modern industrial system with Hainan characteristics and advantages. Municipalities and parks should elevate their stance, deepen understanding, continuously optimize the business environment, improve factor guarantee mechanisms, and effectively fulfill primary and territorial responsibilities. (17) Improving Factor Guarantees. Increase fiscal investment in the modern industrial system and leverage the role of the Free Trade Port Construction Investment Fund. Accelerate the construction of a financial service system matching the modern industrial system, encourage an increase in the proportion of manufacturing loans, and vigorously develop a multi-level capital market and industrial insurance. Innovate land supply methods for industrial projects. Strengthen energy and water supply guarantees for enterprises, prioritizing the environmental capacity and energy consumption indicator needs of major industrial projects. We will strengthen the construction of talent aggregation platforms and carriers, comprehensively introduce, cultivate, and effectively utilize talents, and promote Hainan into becoming an island of talent convergence and technological innovation. (18) Strengthen project support. We will establish a key project database for the modernized industrial system, actively plan, cultivate, and reserve a batch of high-quality projects, and promptly update and include them in the key project database. We will encourage financial institutions to innovate financial products and services that support the construction of key projects in the modernized industrial system. We will establish a mechanism for regular project scheduling, collaborative promotion, and tracking services to ensure that key projects are put into production and yield benefits as soon as possible. (19) Improve the statistical system. We will explore and establish a statistical monitoring indicator system for the four leading industries, industrial parks across the province, and key industrial clusters, improve the monitoring of key indicators, information sharing, and information release mechanisms, dynamically track and monitor changes in data, and promptly reflect the development of industries in key areas. (20) Deepen policy empowerment. Focusing on the new opportunities for constructing a modernized industrial system after the implementation of customs clearance operations, we will maximize the leverage effect of free trade port policies on the construction of a modernized industrial system. We will leverage the advantages of integrated institutional innovation to accelerate the implementation of core policies for the Hainan Free Trade Port. We will conduct dynamic assessments of major industrial policies to ensure the security and stability of the industrial chain and supply chain before and after the implementation of customs clearance operations.

SMM News on July 15: On July 14, Wu Xiaodong, Deputy Director of the Shanghai Office in Fushan District, Yantai City, and Liu Zeyu, along with their delegation, visited the Shanghai headquarters of SMM Information & Technology Co., Ltd. (SMM) for an exchange visit. Yu Jin, Senior Marketing Director of SMM, and Pu Yong, Manager of the Automotive Industry, warmly received the guests. During the visit, both sides engaged in in-depth exchanges and discussions on the development trends of the automotive industry, collaborative innovation in the industry chain, and future cooperation directions. The visit aimed to strengthen regional industrial collaboration, promote the high-quality development of the automotive industry, and achieve resource sharing and complementary advantages. Deepening Cooperation for Mutual Development: Yu Jin from SMM stated that as a leading metal industry information service provider, SMM possesses abundant industrial data resources, a professional research team, and extensive industry influence. In the future, SMM is willing to strengthen cooperation with Fushan District, Yantai City, in areas such as industrial research, investment attraction, and enterprise services, jointly promoting the high-quality development of the automotive industry. The delegation from Fushan District, Yantai City, expressed appreciation for SMM's professional capabilities in exhibition business, industrial research, and data services. They hoped to take this exchange as an opportunity to further deepen cooperation between both sides, jointly explore new models and paths for the development of the automotive industry, and achieve mutual benefits and win-win results. Introduction to Fushan District, Yantai City: Fushan District, Yantai City, is located in the central part of Yantai City and is a modern urban area dominated by advanced manufacturing. Since the establishment of SAIC GM Dongyue Vehicle Base in Yantai in 2002, Fushan District has seized development opportunities and consistently developed the automotive industry for over 20 years. As of now, it boasts over 40 investment projects from Fortune 500 companies, such as Bosch Huayu and SAIC Transmission, forming six major product series including auto body, steering, power, seating, electrical, and interior and exterior trim, with over 220 product types. It has been rated as a "National Torch Plan Automotive Parts Industry Base" and a "Characteristic Industrial Cluster in Shandong Province." In 2023, the Weichai FinDreams new energy three-major-electric project successfully settled in Fushan. Fushan will seize this opportunity and rely on its traditional automotive parts industry advantages to continue its efforts in the direction of NEVs.