What’s in the $16 Billion Dong Nai Free Trade Area?

The People’s Committee of Dong Nai Province recently organized a workshop titled “Free Trade Area in Dong Nai – A Growth Driver in the New Era: Taking Off with Long Thanh Airport.”

The workshop attracted a diverse audience, including scientists, experts, government agencies, and domestic and foreign enterprises and business associations.

During the workshop, experts, scientists, businesses, and government agencies expressed their support for the development of a free trade area in Dong Nai Province, believing it will contribute significantly to achieving double-digit growth in the new era.

Additionally, some experts provided insightful analyses highlighting the comparative advantages, potential, and new development opportunities that a free trade area would bring to Dong Nai Province.

According to the proposal, the free trade area will span over 8,500 hectares and integrate four functional areas: production (3,095 hectares), logistics (2,244 hectares), finance-commerce-services (1,500 hectares), and research, innovation, and digital economy (1,419 hectares). The total investment for the entire area is estimated at USD 16 billion, with public investment accounting for 5%, domestic private investment 40%, and the remaining 55% coming from foreign direct investment.

The first phase is expected to be implemented over five years, covering an area of 3,700 hectares, and requiring a budget of over USD 9.2 billion. Dong Nai Province will select 18 industries for the free trade area, including digital logistics, electronics, machinery, information technology, pharmaceuticals, food processing, and human resources training.

The People’s Committee of Dong Nai Province emphasized that this will be the first free trade area in the country to fully integrate a production ecosystem, airport-seaport logistics, commercial finance, and high-tech industries. By directly connecting with Long Thanh Airport and Phuoc An Port, the free trade area will form a multimodal logistics chain, optimizing costs and enhancing competitiveness.

Additionally, the Dong Nai Free Trade Area will link with Ho Chi Minh City’s Cai Mep Ha Free Trade Area to create a mega free trade zone with synchronized and superior policies to compete regionally and internationally.

Dong Nai Province anticipates that the project will boost the province’s GRDP growth, attract international investment, and create high-income job opportunities. The province plans to report and submit the proposal to the Prime Minister for approval in July.

Dong Nai Province has proposed several incentives, including a five-year corporate income tax exemption for priority sectors within the free trade area, a five-year personal income tax exemption for experts and employees (applicable only to foreigners), and a value-added tax exemption.

The free trade area will offer a maximum land lease term of 70 years, with the possibility of an extension ranging from 10 to 29 years. Land rent will be waived for the first 20 years, with regular charges applying from the 21st year onwards.

Dong Nai Province has petitioned the National Assembly and the Government to enact legislation for the establishment of free trade areas in localities, providing a legal basis for the province to implement this initiative.