China’s Pilot Free Trade Zones: Policy Experimentation, Institutional Constraints, and Reform Priorities

China’s Pilot Free Trade Zones (PFTZs) serve as geographically bounded laboratories for market-oriented institutional reform as well as platforms for trade and investment. This policy review and prospective institutional analysis traces the program’s evolution from the establishment of the Shanghai PFTZ in 2013 to a nationwide network of 23 zones by 2026 and assesses its future direction. PFTZs have advanced trade facilitation, investment administration, financial reform, and public-service delivery, but their broader ambition to develop a mature and replicable framework for rules-based economic opening remains only partially realized. The principal constraint is the tension between centrally controlled experimentation and sufficient delegated authority at the local level. Centralized approval, fragmented administrative authority, asymmetric accountability, and heightened economic and geopolitical uncertainty have favored incremental, low-risk initiatives over deeper institutional reform. Nationwide expansion has broadened the program’s geographical reach while weakening its original emphasis on concentrated experimentation. The next phase should strengthen rule-based delegation for qualified PFTZs, protect good-faith experimentation through credible procedural safeguards, uphold competitive neutrality, and assess performance primarily by the quality and replicability of institutional reform rather than short-term growth in trade and investment. JEL Classification F13, F21, H11, O24, P21