This initiative aims to attract investment, finance, trade, tourism, and high-quality services through pilot mechanisms and policies.

On June 26, with an overwhelming majority of 452 out of 459 deputies in favor, the National Assembly passed a resolution regarding the organization of urban government and piloting specific mechanisms for Da Nang City's development.

The resolution will come into effect on January 1, 2025, and will be implemented over five years.

The Da Nang Free Trade Zone will include various functional areas such as production zones, logistics centers, trade, service areas, and other functional zones as specified by the Prime Minister's decision. The buying and selling of goods between these functional areas and external zones will follow export and import regulations per Vietnamese law on customs and taxes.

The Da Nang Free Trade Zone will implement several preferential investment policies. Projects by investors leasing land in this zone will be treated as investment projects in economic zones per legal provisions. Investment projects will also benefit from tax incentives and land rent reductions. Enterprises with investment projects in the zone will receive preferential customs treatment for export and import activities when they meet the conditions prescribed by law.

The majority of National Assembly deputies supported the pilot implementation of the Da Nang Free Trade Zone, recognizing it as a breakthrough policy that showcases innovation and courage. However, some expressed concerns that the policies were not significantly different from those applied to existing economic zones.

The National Assembly Standing Committee emphasized the importance of cautious implementation, solid steps, and thorough assessments to avoid high-risk issues. The policies need to be based on Da Nang City's implementation capacity and financial resources.

Regarding tax incentives, the Standing Committee noted that free trade zones worldwide often offer tax exemptions and lower corporate income taxes compared to national regulations. Vietnam has gradually adopted similar models in export processing zones, duty-free zones, and bonded warehouses.

To ensure strict control and management, the Government will direct Da Nang City and relevant agencies to strengthen inspections and prevent policy abuse.

The resolution also highlights Da Nang's efforts to attract strategic investors, particularly in AI technology, semiconductor chip technology, integrated circuits, information technology, innovation, and research and development. These investors can opt for State land leases with one-time rental payments for the entire lease term.

Determination of land prices and financial obligations will follow the law on land and related regulations.

Tran Thuong