Establishing a Free Trade Zone linked to the seaport at Cai Mep Ha creates a strategic impetus, contributing to elevating the position of Ho Chi Minh City's maritime economy and logistics.
On December 11th, the National Assembly passed a Resolution amending and supplementing several articles of Resolution 98/2023/QH15, which includes a superior legal framework for the Ho Chi Minh City Free Trade Zone (FTZ) model. These superior mechanisms are expected to remove barriers and help Ho Chi Minh City transform its advantages in seaports, multimodal transport, and urban scale into new growth drivers.
Many outstanding tax and land incentives for FTZs.
According to the resolution, the Ho Chi Minh City Free Trade Zone was established to pilot superior mechanisms and policies aimed at attracting investment, finance, trade, services, and high-quality human resources.
The Ho Chi Minh City People's Council has the authority to decide on the procedures for establishing and expanding the boundaries of free trade zones. Meanwhile, the City People's Committee has the right to decide on these matters regarding the free trade zone associated with the Cai Mep Ha seaport area.
The Management Board of Export Processing Zones and Industrial Parks is the unit directly managing the free trade zone. Currently, the establishment of industrial parks and economic zones is under the authority of the Prime Minister .
Regarding taxes, businesses undertaking new investment projects in Ho Chi Minh City's Free Trade Zone will enjoy a corporate income tax rate of 10% for 20 years (including a tax exemption for 4 years and a 50% reduction in tax payable for the following 9 years).
A 50% reduction in personal income tax for 10 years will be granted to experts, scientists, talented individuals, managers, and highly skilled workers who earn income from salaries and wages for work performed in the Free Trade Zone.
Ho Chi Minh City has the autonomy to select strategic investors based on the principles of openness and transparency, and on criteria such as capital, experience, and technological commitment.
Regarding land, the Chairman of the People's Committee of Ho Chi Minh City is authorized to allocate and lease land without auctioning land use rights or bidding to select investors for projects using land within the Free Trade Zone (except for commercial housing construction projects). Ho Chi Minh City is authorized to determine the price framework for leasing infrastructure within the Free Trade Zone.
According to many experts, granting Ho Chi Minh City autonomy in land management is a crucial factor. Allowing land allocation and leasing without auction or bidding will facilitate attracting strategic investors, major global corporations, and large conglomerates.
The resolution also introduces a mechanism to significantly simplify specialized procedures. Imported and exported goods within the free trade zone are exempt from specialized inspections if they have been certified as conforming to standards or regulations, or have conformity assessment results recognized under international treaties. Businesses in functional zones that meet the conditions of a duty-free zone are allowed to buy and sell goods with the outside area through import and export transactions; and are permitted to list, price, and settle payments in foreign currency with each other.
FTZ Cai Mep Ha creates momentum for breakthrough development, helping the Southeast region.
According to experts, the Cai Mep Ha Freeway Zone, if connected to a deep-water port, could form a "port-service city" comprising a duty-free shopping center, entertainment area, international events, port-side tours, and large-scale MICE services.
Many large businesses in Ho Chi Minh City have expressed their readiness to embrace the Free Trade Zone (FTZ), viewing it as a great opportunity to restructure their operations. Mr. Nguyen Quoc Ky, Chairman of the Board of Directors of Vietravel, assessed that the FTZ is not only a driver of economic growth but also opens up new avenues for tourism development. Experience from Singapore and Busan (South Korea) shows that FTZs often serve as the "nucleus" for the formation of entertainment complexes, duty-free shopping areas, international marinas, and high-end accommodations, creating a superior value-added chain. Ho Chi Minh City has the potential to join this "high-level playing field" if it develops the FTZ in an "open" direction, linking international trade with unique tourism experiences.
Ho Chi Minh City assesses that the establishment of the Cai Mep Ha Freeway Zone will create a breakthrough development impetus, helping the Southeast region to maximize the advantages of the Cai Mep - Thi Vai deep-water port and Long Thanh International Airport, making the Southeast region a leading maritime and logistics service center in Southeast Asia.
In recent years, the trade, service, and tourism sectors have consistently been among the most important pillars, maintaining double-digit growth rates for many consecutive years, thereby making a significant contribution to the overall growth of Ho Chi Minh City. By 2025, total retail sales of goods and consumer service revenue are estimated to increase by 13.5% year-on-year. Meanwhile, this year, the tourism industry is expected to welcome approximately 8.5 million international visitors and 45 million domestic visitors, with total annual revenue reaching around VND 260,000 billion, a 36% increase compared to last year. This provides a sufficiently large market foundation for FTZ to become a new highlight in the development strategy of Ho Chi Minh City in particular, and Vietnam in general.
Linh Anh
Source: https://baochinhphu.vn/khu-thuong-mai-tu-do-tao-dong-luc-moi-cho-tphcm-but-pha-101251211162748941.htm
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