Empowering border trade zones for prosperity and better ties

The Manzhouli land port in China's Inner Mongolia autonomous region recorded 678 China-Europe freight trains in the first quarter of 2025, a 7.1-percent increase on traffic year-on-year. [Fu Guoliang / For China Daily]

The first batch of border trade permits was officially issued at Ganqimaodu Port, Inner Mongolia autonomous region, to 10 local border residents in January.

With this, the autonomous region's ninth border mutual trade zone is set to begin operations. These nine zones, stretching from the northeast to the southwest like a string of gleaming pearls, play a vital role in vitalizing border communities, bringing prosperity, strengthening neighborly ties and securing the border — bolstering the region's role as a strategic gateway opening northward and contributing to Inner Mongolia's modernization at the county level.

Mutual trade across the border has long been a key lever for boosting development in frontier areas. China's frontier areas are predominantly ethnic minority regions and economically less developed. Since the implementation of reform and opening-up in 1978, the government has encouraged mutual trade across the border at established ports.

In the three decades since its launch in 1996, the mutual trade zone at Manzhouli Land Port has seen the integration of road and rail operations to become China's first mutual trade hub with Russia.

Similarly, the mutual trade zone at Erenhot Land Port, which opened in 2017, is the country's largest such zone dedicated to trade with Mongolia. These two flagship zones have set the benchmark for border prosperity, stability and good-neighborly relations.

Other mutual trade zones, each drawing on its own geographical advantages and resource endowments, are charting distinctive paths in mutual trade with the aim of pursuing differentiation and specialization.

In doing so, they not only ensure local prosperity and reinforce border security but also inject fresh momentum into the region's economy. Together, they are emerging as a new engine for high-quality development in the autonomous region's port economy, unlocking a fresh formula for border governance and community well-being, and enduring good neighborly relations.

The mutual trade zones are also paving a clear path to prosperity for border residents. A single permit is, in effect, a ticket to a better livelihood.

The government has granted mutual border trade a favorable policy framework: on top of the daily duty-free quota of 8,000 yuan ($1,187) per border resident, it has expanded the list of zero-tariff imported goods and introduced a dynamic adjustment mechanism for living subsidies, while also encouraging border residents in flag counties without ports to engage in cross-border trade through the nearest ports.

Across the board, these zones are energizing grassroots border trade with a spirit of innovation and enterprise, opening up steady income streams for local residents. In Manzhouli, for example, the port authorities and local government have rolled out the Mantong App to make mutual trade policies accessible to every eligible resident.

Each transaction earns residents 80 to 100 yuan; during the peak season, monthly earnings can top 1,000 yuan. With both the railway and road zones operating in tandem, Manzhouli's mutual trade sector is booming — truly becoming a reliable avenue for border residents to boost their incomes and build a better life.

From January to April 2026, the border mutual trade zone in Manzhouli saw its commodity trade volume reach 47,800 tons, a year-on-year increase of 75.89 percent; the trade value reached 189 million yuan, up 59.56 percent year-on-year.

Among this, road-port border trade imports accounted for more than 1,266 tons, with a trade value of 18 million yuan, involving 2,444 border traders. Railway-port border trade imports reached 46,500 tons, with a trade value of 171 million yuan, involving 22,300 border traders.

Driven by the "dual-engine" synergy of railway and road border trade zones, Manzhouli's border trade vitality continues to surge, effectively becoming a channel for border residents to increase their income and achieve prosperity.

At the Erenhot port, authorities have introduced a digital platform called "Bianjiantong", designed to streamline declaration and customs clearance for both border residents and businesses. The system significantly reduces market risks and transaction costs, while also fostering a new cooperative-driven development model that combines mutual trade with local co-operatives.

Border residents can voluntarily form small cooperatives to pool their daily duty-free quotas of 8,000 yuan each, enabling economies of scale and deeper participation in mutual trade. Port authorities and customs have also rolled out a "one-stop" clearance model that greatly improves the efficiency of cross-border movement.

Apart from business purposes, it has become common for border residents to drive back and forth for family visits too. With smoother clearance procedures and continuously improving full-service support systems, Erenhot's mutual trade volume has reached new heights.

In 2025, the port ranked first among northern Chinese ports in mutual trade value. Freight throughput, passenger crossings, and vehicle crossings reached roughly 22.23 million metric tons, 2.82 million person-trips and 759,000 vehicle movements respectively — all record highs.

In the first half of 2026, the border trade zone in Erenhot saw its import commodity transaction value reach 243 million yuan, with a cargo volume of 8,428.17 tons, representing year-on-year growth of 195.42 percent and 98.15 percent, respectively.

By July 2026, the number of registered border residents at the port had reached 16,341, and the zone had cultivated 28 local processing enterprises, 19 mutual assistance groups and 6 cooperatives.

The border trade zones in Manzhouli and Erenhot have become pilot zones and innovation hubs.

Building on the flagship example set by Manzhouli and Erenhot, other mutual trade zones are leveraging their own geographical advantages to explore a variety of innovative models, such as internet + border mutual trade, border trade + secondary market + local processing and border residents' trade + cooperatives + local processing. These approaches are enabling more border residents to boost their incomes and turning the goal of prosperous borders and thriving communities into a tangible reality.

For example, as a port designated for the regular import of forage from Mongolia, Ebuduge Port has also been identified as a key port in eastern Inner Mongolia for the import of live sheep. In 2025, the port achieved breakthroughs in foreign investment, foreign economic cooperation and foreign trade, marking a zero-to-one milestone. The port's trade volume quadrupled, with on-site trade value exceeding 15 million yuan and outbound investment reaching 38 million yuan, both hitting record highs.

The Ceke mutual trade zone, which began operations in 2024, has successfully launched used-vehicle and fruit-and-vegetable exports, business lines that were previously nonexistent.

The opening of the vegetable export route from Ceke to Mongolia has made it easier to ship fresh produce to Ulaanbaatar, capital of Mongolia, significantly cutting transportation costs and improving product freshness.

In addition, Beiben Trucks Group Co has set up a vehicle sales and service center within the Ceke zone, further diversifying the port's trade portfolio. Events, such as international New Year goods festivals and mutual trade expos, have diversified the zone's offerings and become important drivers of income growth for local residents.

The preferential policies of these mutual trade zones have tangibly improved the quality of life for border communities, and residents are more confident than ever in their journey toward greater prosperity. The appeal of border trade policies has also drawn young people back to their hometowns to start businesses, injecting fresh energy and vitality into the region's development.

The policies have also drawn a number of small businesses into the border mutual trade zones, fostering a new development model that combines border mutual trade with local processing and giving a powerful boost to the local processing economy.

The government of the autonomous region has released an array of policies to support border trade zones.

On the one hand, these policies aim to accelerate the integrated growth of processing, investment and trade in the Manzhouli and Erenhot zones. On the other hand, they encourage people's government at or above the county level to pursue innovative approaches — nurturing processing industries tied to mutual trade, developing logistics networks and commercial hubs tailored to local conditions, expanding the range and volume of imported goods eligible for mutual trade, and advancing the on-site processing of such imports.

Furthermore, the autonomous region allocated 27.1 million yuan in 2025 to support the construction of import resource local processing industry projects, promoting the quality and efficiency improvement of border trade zones. Benefiting from a series of favorable policies, the border trade zones have seen continuous expansion in import categories, a growing number of local processing enterprises, and steadily rising trade volumes.

The border trade zones have been actively developing new industries and business forms such as processing, manufacturing, and service trade, and have innovatively introduced a coordinated development model combining border residents + enterprises + cooperatives and border trade + secondary market + local processing. These efforts have attracted Chinese and foreign companies to settle in the border trade zones, making the overall scale of the border trade zones increasingly larger.

In the first half of 2026, for example, Erenhot's local processing model achieved a transaction value of 238 million yuan and a cargo volume of over 8,221 tons, up 204.90 percent and 123.54 percent year-on-year, respectively. Local processing business accounted for 97.55 percent of the city's total border residents' trade volume.

The eight mutual trade zones in the autonomous region have enabled border residents to source, process and sell goods locally, boosting trade flows and spurring growth in logistics, warehousing and processing industries. This has been instrumental in transforming the region's port economy from a simple transit-based model to a value-added, processing-driven one.

By converting locational advantages and resource endowments into real economic gains, the zones have not only driven economic development in border counties — lifting their GDP — but also injected significant momentum into Inner Mongolia's broader economic growth.

The trade zones have emerged as models of good-neighborly friendship between China and Russia, as well as between China and Mongolia. As these zones continue to expand the scale and variety of cross-border mutual trade commodities, introduce value-added processing operations, and implement smart and digital customs clearance measures, they have attracted a growing number of Russian and Mongolian citizens and products to the Chinese border markets.

These developments have significantly strengthened grassroots ties and mutual trust among the communities living in the frontier areas.

Mongolian traders who frequently travel between the two countries for shopping and business have noted the marked improvements in clearance efficiency. Some merchants who have long been shuttling between China, Russia and Mongolia now partner with local Chinese border residents within the mutual trade zones, jointly operating businesses and co-developing brands.

Such cross-border partnerships have flourished more in the China-Mongolia zones, where language barriers are relatively low. The goods traded through border mutual trade channels are typically signature products from neighboring countries.

On the Russian border, imports include flaxseed, oats, millet, honey, bread and flour. On the Mongolian side, common imports are frozen horse meat, wool and cashmere raw materials, handicrafts, traditional Mongolian robes and carpets.

Local processing enterprises registered within the zones procure these raw materials through mutual trade channels and carry out local value-added processing, converting them into higher-margin products and extending the industrial chain.

With the support of an internet plus border mutual trade model, traditional exports such as used vehicles, agricultural machinery, and specialty agricultural products have increased, generating a win-win outcome: more income for border residents, thriving businesses and greater tax revenue for local governments.

The eight existing border mutual trade zones have made full use of national policy support, operating with standardized procedures and targeted services.

By aligning procurement with domestic sales channels, they have made it easier for border residents to participate in mutual trade and given a real boost to the local economy.

This has helped shift the trade structure from sheer scale expansion to quality-driven growth, advancing the broader goals of beautiful border landscapes, stable border governance and secure border defenses.

The State Council, China's Cabinet, issued an overall plan in April for the pilot free trade zone of Inner Mongolia autonomous region, explicitly calling for innovative development of border mutual trade.

The plan emphasizes accelerating the digital transformation of mutual trade service platforms and supervision systems, implementing tiered inspection and categorized regulation of imported mutual trade goods, and promoting a clearance model that integrates entrusted declaration, direct transport and mechanized inspection. It also explores optimizing supervision mechanisms for exported mutual trade goods.

With ports as core hubs and high-level open platforms as key drivers, the plan aims to coordinate foreign trade, foreign investment utilization, outbound investment and open platform development.

These efforts are expected to ensure the steady and orderly growth of cross-border cooperation in the mutual trade zones, making them a standout feature of Inner Mongolia's northward opening-up strategy.

The author is the director of the Belt and Road Initiative Research Institute at the Inner Mongolia Academy of Social Sciences.