China's southernmost province Hainan has teamed up with domestic home-sharing platform Xiaozhu.com to promote shared accommodation in villages to boost rural tourism.

The two parties will promote the island's beautiful villages and build demonstration villages using bed and breakfast (B&B) accommodation for poverty alleviation, according to a strategic agreement signed Wednesday by Hainan's tourism development commission and Xiaozhu, the first home-sharing service provider to partner with the island.

They also set up a B&B industry association and plan to launch a B&B design and entrepreneurship contest to seek international talent and promote home-sharing. Xiaozhu will also offer home-sharing business courses to help train local residents.

The sharing economy has offered fresh impetus to power China's economic transition as more people and services are connected by the internet, said Zhang Xinhong, director of the sharing economy research center at the State Information Center (SIC).

Home-sharing in rural areas has huge growth potential as more and more Chinese tourists are traveling to villages for unique rural experiences, Zhang added.

A SIC report showed that China's home-sharing market transaction volume surged 70.6 percent year on year to stand at about 14.5 billion yuan (2.14 billion U.S. dollars) last year, and the number is expected to reach 50 billion yuan in 2020.

Hainan, blessed with a tropical climate and coastal views, has been working for years to turn the island into a popular destination for both domestic and international tourists.

There are about 516 rural tourist sites across the island, bringing about 1.75 billion yuan in revenue in the first half of this year, up 14.2 percent year on year, according to Ao Liyong, deputy director of the Hainan Provincial Tourism Development Commission, adding that rural tourism has become a key engine to power the rejuvenation of the countryside by increasing rural incomes and living standards.

As one of the leading home-sharing market players, Xiaozhu rolled out a brand village home-sharing service in 2016 and has over 30,000 rural B&B listings so far. Each B&B room can create six local jobs, according to Wang Liantao, Xiaozhu's COO and co-founder.

Founded in 2012, Xiaozhu now has over 420,000 listings in 652 cities across the globe, with over 35 million active users. The start-up secured 120 million U.S. dollars in funding last November and signed strategic partnerships with Alibaba's travel branch Fliggy and Booking's online reservation platform Agoda in the first half of this year.