The first downtown Beijing duty-free shop will be located in the central business district, according to People's Daily website.

China Duty Free (Group) Co Ltd signed a strategic cooperation letter with Beijing Chaoyang district government at the China Beijing International Fair for Trade in Services. The two sides agreed to open the first city duty-free shop in the capital of world's second largest economy to enable foreign tourists to receive tax refunds.

"The duty-free shop is an integral part of the duty-free industry, which promotes purchases by foreign tourists as well as the selling of Chinese goods," said an official with the Chaoyang District Commission of Commerce.

In addition, the shop will help to lower the "threshold" of the Chinese luxury consumer market and improve the sales system within the industry. The establishment of the system will form a complete industrial chain for Beijing's tourist and retailing industries and push high-end retail industry to a higher level, said the Chaoyang District Commission of Commerce.

The Chinese government introduced many policies to stimulate domestic demand in recent years, resulting in new growth opportunities for China's retail industry. According to statistics, China's retail market totaled 18.1 trillion yuan ($2.85 trillion) last year, a 17.1 percent increase over the previous year.

liwoke@chinadaily.com.cn