The international financial center in Ho Chi Minh City has 4 competitive product groups

According to the draft Strategy for the Development of Vietnam International Financial Center in Ho Chi Minh City (VIFC-HCMC), 4 pillar product groups include: international capital market, financial services serving international trade, digital banking and Fintech, new financial service products serving niche markets.

The VIFC-HCMC executive agency presides over this project, advised by Boston Consulting Group (BCG). The selection of 4 product groups is based on the Government’s orientation, as well as an assessment of the advantages and capabilities of Ho Chi Minh City and potential customers.

It is expected that in the next 12-18 months, VIFC-HCMC will focus on developing a number of specific products for each group. For example, the international capital market prioritizes the development of corporate and local bonds, IPO activities, and specialized support services.

The Finance for International Trade Group promotes trade and supply chain credit. Meanwhile, the digital banking product group targets Fintech solutions, digital asset sandbox, cross-border payments using stablecoin/crypto. In the niche market, the initial target is to trade agricultural products and carbon credits.

At the conference “Development Strategy of Vietnam International Financial Center in Ho Chi Minh City” organized by the Ho Chi Minh City Institute for Development Studies (HIDS) on the afternoon of January 28, Mr. Ginolin, CEO of BCG Vietnam “strongly recommended” the development of international debt and equity capital markets.

Because according to him, in theory, Vietnamese businesses can access international capital markets but there still exist barriers in terms of costs and intermediaries. Therefore, this product group will be more convenient for them and practical for the Vietnamese economy.

Experts from American consulting firms also support VIFC-HCMC in considering financial products serving international trade as the mainstay, because they are consistent with the trend of global trade shifts, with ASEAN as a beneficial partner. In addition, high-quality digital technology human resources with competitive costs bring prospects to Fintech.

Dr. Can Van Luc, Chief Economist of BIDV, Member of the Advisory Team of the VIFC-HCMC Construction and Development Steering Committee agrees with the 4 key product groups and proposes to classify products that can be done immediately and need a roadmap.

In the immediate future, traditional financial services such as banking, securities, and investment funds can now gather soon at the Financial Center. It is necessary to develop more venture capital funds and green finance. Meanwhile, some new, groundbreaking products that need a roadmap include capital financing for supply chains and free trade zones, commodity derivatives, and gold trading floors.

Ms. Nguyen Huyen Diu, Deputy Director of the Monetary Policy Department, State Bank of Vietnam commented that VIFC-HCMC’s 4 product groups need to closely follow Resolution 222 of the National Assembly on specific policies and 8 Decrees of the Government.

For example, using stablecoins to transfer remittances or travel payments has no legal basis and risks exceeding the framework of Resolution 22. Vietnamese law does not recognize stablecoins as a means of payment, so it needs to be proposed from the perspective of encrypted assets.

Some businesses expressed their desire to participate in product groups being planned by VIFC-HCMC. Mr. Vu Quoc Anh, CEO of Galaxy Pay of Sovico Group, said that the unit is establishing a Fintech Hub in the Saigon Marina IFC building, within the scope of VIFC-HCMC. This center has the role of attracting financial technology projects and investment funds.

Mr. Hoang Duc Trung, Deputy General Director of VinaCapital, proposed establishing Ho Chi Minh City Venture Capital Company in the form of the State holding 40% of the capital to play a leading role and 60% of the capital mobilized from private organizations and businesses. Mr. Pham Quoc Long, Deputy General Director of Gemadept proposed establishing the Ho Chi Minh City Maritime Finance Center in association with VIFC-HCMC.

Ho Chi Minh City is ranked 95 out of 120 cities in the Global Financial Centers Index. The locality aims to be in the top 75 in 2035 and top 50 in 2045, according to Associate Professor. Dr. Nguyen Huu Huan, Vice Chairman of VIFC-HCMC Executive Agency.

Vice Chairman of Ho Chi Minh City People’s Committee Nguyen Van Dung said that he is accelerating the completion of IFC’s operating regulations, applicable to both Ho Chi Minh City and Da Nang. In parallel, complete the draft VIFC-HCMC development strategy.