On October 16, 2020, at the just-concluded Ho Chi Minh City Party Congress, the leaders of Ho Chi Minh City suggested that the government support the development of Ho Chi Minh City’s financial center as a national key task and important strategy. At the same time, it is recommended that the government support the development of "Ho Chi Minh City into a regional and international financial center" as an important national strategy and key mission target, and include it in the "2021-2030 Stage and 2045 Socio-economic Development Strategy"; this content will be added to the XIII Draft documents of the National Party Congress.

1. The special advantages of Ho Chi Minh City

According to the assessment of economic experts, Ho Chi Minh City has many potentials to form a regional and international financial center.

First, the World Economic Forum (WEF) evaluated that Ho Chi Minh City has become the most attractive destination for emerging Asian economies due to a sharp jump of 10 places in the global competitiveness index ranking in 2019.

Secondly, both Vietnam and Ho Chi Minh City have many advantages as a development financial center. Vietnam has a time zone different from the 21 largest financial centers in the world. This is the "unique and special" advantage of attracting idle funds from these centers during the closing period.

Third, in addition to its superior natural geographical location, Ho Chi Minh City is currently the main driving force of the Vietnamese economy. Ho Chi Minh City only accounts for 9.35% of the national population and 0.63% of the area, but in 2019, the city contributed 23% of the national GDP, about 27% of the national budget, and attracted more than 33% of the national FDI projects, accounting for mergers and acquisitions and venture capital. A large part of indirect investments such as funds and remittances. In addition, Ho Chi Minh City is also the birthplace of the Vietnamese stock market. The city’s financial infrastructure still has huge potential for commercial banks, intermediary financial institutions, investment funds, financial companies, and securities companies, not only for the financing and distribution of Ho Chi Minh City but also for the national economy. All aspects play an important role. Moreover, in the past few years, the financial markets of both Vietnam and Ho Chi Minh City have been continuously and steadily developed. Compared with other parts of the country, the city currently has the highest concentration of financial institutions. Only the banking system and non-bank credit institutions have 2,138, including bank offices, stock exchanges, 50 wholly foreign-funded bank branches, 31 joint-stock commercial banks and 4 state-owned banks. In 2019, the city's total deposit balance accounted for 24.09% of the country's total. The total loan balance of Ho Chi Minh City also accounts for 28.05% of the country. This shows that Ho Chi Minh City has a huge demand for financial activities, which is a good condition for the formation and development of a regional and international financial center in the future.

2. The main development goals of the financial center

The regional orientation and development of Ho Chi Minh City can not only consolidate the city's position as the economic-financial-trade center of Vietnam, but also have a positive impact on the economy's blood-funding source. Capital flows will attract more investors and drive the development of an ecosystem of auxiliary financial service products to form a high-quality infrastructure and living environment.

Short-term goal: to form a national financial center.

Mid-term goal: Positioning as a regional financial center. In the initial stage, the Ho Chi Minh City Financial Center aims to provide financial services to neighboring countries such as Laos, Cambodia, Myanmar or Brunei. Afterwards, Ho Chi Minh City will work to join the regional financial center network, not only to provide financial services for ASEAN countries but also for more countries.

Long-term goal: The financial center of Ho Chi Minh City will attract the supply and demand of financial products to provide services for the development of business activities, business investment, and attract the world's leading financial institutions and economic organizations. Editor/Xu Shengpeng