Da Nang is Vietnam's fourth largest city. Recently, it was learned that Vietnam plans to build a free trade zone (FTZ) in Da Nang to attract more foreign investment into this coastal city. The FTZ is located near Da Nang International Airport and covers an area of 450 hectares.

01 Exemptions from corporate income tax, land rent an

d import duties

Da Nang is Vietnam's fourth largest city. Recently, it was learned that Vietnam plans to build a free trade zone (FTZ) in Da Nang to attract more foreign investment into this coastal city. The FTZ is located near Da Nang International Airport and covers an area of 450 hectares.

The FTZ will become a hub for export processing, logistics, business center and production area. In addition, the FTZ is expected to include Lianzhou Port, which is currently under construction and is expected to be completed in November 2025.

To encourage investment, the Da Nang FTZ will implement a number of pilot policies and mechanisms in the first five years of operation. Foreign investors in the zone will enjoy a series of incentives, including exemption from corporate income tax, land rent and import tariffs.

02 Free Trade Zone Planning

The Da Nang Free Trade Multifunctional Zone has a clear geographical boundary and is separated from the external area by a fence to ensure that customs and relevant agencies conduct inspections and supervision in accordance with the laws and regulations of various fields. The flow of goods between the multifunctional zone and the external area will be based on the import and export relations established in accordance with customs, taxation and import and export laws.

The procedures and procedures for foreign investors to apply for the establishment of economic organizations are established in accordance with domestic investment in accordance with the Vietnamese Enterprise Law and relevant regulations for each type of economic organization. That is, foreign investors do not need to have an investment case to establish an economic organization in the Da Nang Free Trade Zone, nor do they need to apply for the issuance or adjustment of investment licenses before establishing an economic organization.

According to the resolution, the priority industries to attract strategic investors include: construction of innovation centers, data centers, and research and development centers (R&D) combined with training with an investment amount of more than 2 trillion VND (about 80 million US dollars); investment in technology transfer in high-tech fields such as information technology and artificial intelligence technology (AI); biotechnology, automation and new materials technology, and clean energy projects.

The resolution will take effect from January 1, 2025 and will last for 5 years.

03 Connected to Lien Chieu Port

A key feature of the Danang FTZ is its connection to Lien Chau Port, a deep-water port that is planned to be Vietnam’s main maritime gateway. The port is planned to handle 40-50 million tonnes of cargo by 2050 and help ease congestion at the overloaded Tien Sa Port. Once operational, the port will be able to accommodate 200,000 deadweight tonnes (DWT) cargo ships and container ships with capacities ranging from 8,000 to 18,000 twenty-foot equivalent units (TEUs), as well as 30,000 DWT liquid cargo ships.

The port construction will be carried out in two phases.

• The first phase, funded by the local government and expected to cost $140 million, includes the construction of access roads, breakwaters and channels. 

• The second phase requires about $2 billion in foreign investment and focuses on the development of the terminal area, including eight container berths, six cargo berths and supporting facilities. The Adani Group has expressed interest in investing in this phase.

As a result, Lianzhou Port will become an important logistics center for Vietnam's North-South Railway and the proposed second East-West Economic Corridor.

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