Brian Jeffrey
The government of Dong Nai province has announced plans to create a Free Trade Zone (FTZ) with an estimated investment of around USD 16 billion, featuring an international gold trading center inspired by leading hubs in Singapore and Hong Kong.
The provincial Department of Finance has submitted a draft to seek consent from the National Assembly, Government, and Prime Minister to implement favorable policies and frameworks for the initiative. A standout element is the proposed gold trading center, which would function under unique regulations similar to those governing Ho Chi Minh City’s International Financial Center.
The initiative aims to facilitate smoother capital movement and foreign currency transactions within the FTZ, enhancing payment processes, currency exchanges, and cross-border capital flow for enterprises and investors.
Envisioned as a regional financial hub, the gold exchange will meet international standards and draw influence from financial practices in Singapore and Hong Kong. Dong Nai has reached out to the Ministry of Finance and the State Bank of Vietnam for assistance in establishing the necessary legal and regulatory guidelines.
Spanning over 8,100 hectares, the Dong Nai FTZ will be partitioned into focused zones: 3,095 hectares will be dedicated to manufacturing, 1,987 hectares for logistics, 1,500 hectares for financial and commercial services, and 1,419 hectares for research, innovation, and IT.
Phase 1 encompasses 3,700 hectares with an estimated cost of USD 9.21 billion over a five-year period. Two years after Phase 1 commences, Phase 2 will expand the area to its complete size, requiring an additional USD 6.79 billion.
Funding for this project will be sourced from 5% public investment (USD 0.8 billion), 40% domestic private capital (USD 6.4 billion), and 55% foreign direct investment (USD 8.8 billion).
The Department of Finance indicated that the upcoming Long Thanh International Airport and Phuoc An Port will significantly enhance the FTZ’s attractiveness to investors.
Long Thanh Airport is expected to accommodate 100 million passengers and 5 million tons of cargo each year, thereby bolstering logistics, international trade, and advanced manufacturing. Phuoc An Port will process 5 million TEUs, addressing the increasing import-export needs of Dong Nai and the surrounding Southeast region.
Additionally, Dong Nai suggested that banks and financial institutions within the FTZ be permitted to independently determine their lending and deposit interest rates, in line with market trends and international practices, specifically for businesses operating in the zone.
Moreover, companies within the FTZ would have the freedom to list, value, and settle transactions in foreign currencies. Foreign banks would be empowered to set up transaction offices in the region.
Gold continues to be a favored investment avenue amid global economic and geopolitical instability. Trading Economics reports that 50% of gold is utilized for jewelry, 40% for investments, and 10% for industrial purposes. The World Gold Council identifies Shanghai, London, and COMEX (U.S.) as the leading global gold trading centers, collectively responsible for over 90% of all gold transactions worldwide.
Tran Chung
