The key to attracting investment into an international financial center in Vietnam

Mr. Pham Luu Hung - Chief Economist, Head of Training and Development Department, and Director of Investment Analysis and Consulting Center - SSI Securities Corporation (SSI Research) - Photo: VGP/HT

This is the opinion of Mr. Pham Luu Hung - Chief Economist, Head of Training and Development Department, and Director of the Center for Analysis and Investment Consulting - SSI Securities Corporation (SSI Research) when discussing with the Government Electronic Newspaper about the advantages and difficulties on Vietnam's journey to becoming a regional financial center.

Great potential from strategic location and open economy

On November 15, 2024, the Politburo issued Notice 47-TB/TW on the establishment of a regional and international financial center in Vietnam. Accordingly, a comprehensive international financial center will be established in Ho Chi Minh City and a regional financial center in Da Nang city.

To implement this policy, on December 31, 2024, the Government issued Resolution No. 259/NQ-CP approving the Action Plan for the development of a regional and international financial center in Vietnam. Then, on March 5, 2025, the Government issued Resolution No. 42/NQ-CP on the proposal to develop a National Assembly Resolution on a financial center in Vietnam.

Affirming that this is a very methodical policy and steps, Mr. Pham Luu Hung said: Vietnam has favorable conditions to become an important financial center of the region. First of all, the economy is highly open, with a series of new-generation free trade agreements (FTAs), helping to connect closely with the international market. This not only creates conditions for foreign capital to flow in but also helps Vietnam to play the role of a "connecting country" in the context of the world being increasingly fragmented in finance and trade.

Recently, during his working trip to Europe, Deputy Prime Minister Nguyen Hoa Binh had many meetings and worked with international partners to promote cooperation in the financial sector. The trip brought many positive results, helping Vietnam learn from the experiences of major financial centers in the world such as Frankfurt, Luxembourg and London. At the meetings and seminars, representatives of many international enterprises highly appreciated the potential of the Vietnamese market and expressed their interest in investment cooperation. Leaders of financial centers and stock exchanges pledged to support Vietnam in market development, capital access, high-quality human resource training, etc. This demonstrates the trust of the global financial community in Vietnam's potential.

In addition, Vietnam’s geographical location is right in the heart of the Asia-Pacific region, home to many of the world’s most dynamic economies. With fierce competition between financial and technological powers, Vietnam has the opportunity to become an important transit point, attracting investment flows from both the East and the West.

Ho Chi Minh City is considered the city with the greatest advantage to become the financial center of Vietnam. As the economic locomotive of the country, Ho Chi Minh City owns a strongly developed system of banks, securities companies, investment funds and financial institutions.

Meanwhile, Da Nang has also emerged as a potential candidate thanks to its favorable geographical location and increasingly improved infrastructure system. The city is about to launch a Free Trade Zone – an important step to create momentum to attract investors.

However, compared to international financial centers such as Singapore or Hong Kong (China), both Vietnamese cities still have a long way to go, especially in terms of financial infrastructure, operating mechanisms and the ability to attract foreign capital.

Barriers to overcome to realize goals

Expert Pham Luu Hung analyzed: A financial center can only be successful if it has a financial infrastructure system and legal framework that meet international standards. However, this is exactly the point that Vietnam needs to improve.

The financial market is a market of trust. Foreign investors will only invest when they believe that Vietnam’s legal system is transparent enough and protects their interests. To do this, Vietnam needs to quickly complete the legal framework for financial activities, ensuring consistency and accessibility for domestic and foreign enterprises.

In addition, the payment and financial transaction systems also need to be upgraded to meet the requirements of the global market. The application of financial technology (fintech), artificial intelligence (AI) and blockchain in financial management will help Vietnam shorten the gap with the world's leading financial centers.

This expert emphasized: One of the important factors to operate a financial center is a team of high-quality human resources.

"Fortunately, this is not too big an obstacle for Vietnam. In recent years, Vietnam has made significant progress in training financial human resources, with the emergence of many international joint programs. Moreover, Vietnam is becoming an attractive destination for foreign talent thanks to its reasonable cost of living and increasingly professional working environment," said Mr. Pham Luu Hung.

However, expert Pham Luu Hung said that to create a workforce that can compete with the region, Vietnam needs to invest more heavily in financial education, especially in areas such as risk management, financial technology and international capital markets.

Affirming that there is still much work to be done to attract international investors, expert Pham Luu Hung said: To become a regional financial center, Vietnam cannot rely solely on geographical and economic advantages. What is more important is to have an effective strategy to promote and attract international investors.

The best way to do this is by attracting long-term investors (over 5 years) – large financial institutions willing to set up headquarters or representative offices in Vietnam. With the participation of big names, other investors will have confidence in the development potential of the Vietnamese market.

In addition, organizing international financial conferences, facilitating foreign capital flows and developing innovative financial products are also important factors helping Vietnam build its brand on the global financial map.

This expert analyzed: Vietnam does not need to develop a financial center model from scratch. In the world, many financial centers such as Singapore, London or New York have succeeded thanks to methodical strategies.

However, SSI experts recommend that Vietnam should have an approach towards countries with similar levels of development. One of the important lessons is to develop in the direction of "think big, start small" - that is, starting with small but sure steps, having standardized actions to attract domestic financial groups to participate, in addition to attracting new partners, then expanding operations step by step, with a clear roadmap.

As mentioned, the biggest challenge is always the financial infrastructure, legal framework, to meet international standards on financial transactions and investment. Therefore, Vietnam needs partners to accompany throughout the process of building two financial centers so that it can both learn and work, and consider cooperating with a strategic partner in the process of building the financial center.

"Close cooperation with international financial institutions not only helps Vietnam learn from experience but also creates confidence for foreign investors," Mr. Pham Luu Hung suggested.

Huy Thang

Source: https://baochinhphu.vn/chia-khoa-de-thu-hut-dau-tu-vao-trung-tam-tai-chinh-quoc-te-tai-viet-nam-102250326203729348.htm