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| Vietnam wants to create an independent IFC ecosystem, illustration photo/ source: freepik.com |
In the last week of July, the Ministry of Planning and Investment (MPI) organized two working meetings with international organizations and representatives of various ministries, sectors and municipalities to discuss a project to develop regional and international financial centers (IFCs) in Vietnam.
The MPI was established as a permanent body of the National Steering Committee for the Development of Regional and International Financial Centres.
During the meetings, MPI presented the draft project to develop these IFCs in Vietnam. Two other draft projects, one to establish the Vietnamese IFC in Ho Chi Minh City and the other to transform Danang into a regional financial center, were also presented to collect feedback from the representatives.
City leaders said incentives were needed to attract strategic investors who could drive development.
The plans stress that each financial centre must serve as a playground for global financial investors, with common rules consistent with international practices. These include operating mechanisms, ecosystem development and incentive mechanisms tailored to Vietnam’s conditions and putting national interests first.
“Vietnam is seen by international organizations as a bright spot in attracting investments as many factors come together to develop a modern financial market. In addition, the country’s favorable geographical location, high connectivity and different time zones with the world’s 21 largest financial centers provide a strategic geo-economic position,” said Nguyen Thi Bich Ngoc, Deputy Minister of Planning and Investment.
“In addition, the country has good prospects due to active improvements in the investment and business environment, deep international economic integration, digital economic transformation and a rising innovation index. The economic volume and development of the financial market are improving. This provides Vietnam with an excellent opportunity to attract funds from major international financial centers such as London, Hong Kong and Singapore.”
However, the MPI noted that while financial centres are a well-established model in many countries, they are a new and complex issue for Vietnam. Therefore, the choice of model and method to establish such a centre must be based on selective learning from international experience.
The establishment of an IFC has attracted much attention from the government. At a discussion during the World Economic Forum in Switzerland in January, Prime Minister Pham Minh Chinh asked leading global banks and financial investment funds to support Vietnam in establishing an IFC.
“We expect foreign partners to help Vietnam improve its national creditworthiness and raise standards in accounting, auditing and financial reporting, laying a crucial foundation for the development of a future IFC,” said Prime Minister Chinh.
The timeline for the implementation of the IFC will be divided into three periods. From 2025 to 2030, Vietnam will create the basic conditions for the establishment of the center. Policymakers will review the development of the financial center and integrate it into the strategies, planning, programs and action plans of the government and the localities where the center is established.
Pilot measures to establish the financial center and develop infrastructure will be implemented between 2031 and 2035. After that, Vietnam will pursue comprehensive development of the IFC with the aim of making it a regional financial center. In addition, the potential for expanding the financial center will be explored.
In the coming period, the MPI will consolidate the feedback and report to the Head of the Steering Committee to finalize the draft project, which will then be submitted to the Politburo for review and approval. The MPI will also take the lead and work with the relevant authorities to prepare a draft resolution for a specific mechanism to establish and develop the IFC.
The Ministry of Finance is responsible for taking the lead and coordinating with relevant authorities to improve and implement the policies and legal frameworks on taxation, stock market, insurance and customs for the activities of the financial center. It will also issue a fintech test management framework for the securities and insurance sector, and further develop the capital market and upgrade the Vietnamese stock market to create better conditions for the establishment of the financial center.
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