Are special administrative-economic zones under the central or local governments?

On September 11, the Ministry of Planning and Investment submitted the draft Law to the National Assembly Standing Committee (NASC) for review and approval.

This law is applicable to organizations and individuals related to three special zones: Van Don (Quang Ninh province), Northern Van Phong (Khanh Hoa province) and Phu Quoc (Kien Giang province). These three special zones are expected to become one of the leading special zone in the region and the world. The law will regulate the plan, policies on socio-economic development, the organization and operation of local authorities and state agencies in three special zones.

On that basis, the State shall offer preferential policies to attract capital investment for priority industries and hi-tech sector. At the same time, the State will apply advanced foreign management methods. A civilized, modern and high-quality living environment will be formed in the special zones.

"Building nest for the eagle is different from those for the sparrow"

Le Thanh Van, Standing Member of the National Assembly’s Committee for Financial and Budgetary Affairs said that the Law on special zones aims to create a new environment that motivates economic development with specific mechanisms. However, Van highlighted three particular issues, as follows.

First, it is important to focus on offering preferential policies to attract capital investment other than spending much of the state budget, if any, it is just seed capital. Different policies will be applicable for different entities. "The nests are built for the eagle and phoenix is different from that for the sparrow", Van metaphorized.

On that basis, to attract capital investment from the United States, Canada, Japan, Singapore ... their legal framework should be consulted to offer more dominant policies that will attract investors.

Second, capital investment will not be attracted at any costs. Because the special zones, which are planned to be established, are strategically located adjacent to the South China Sea, attracting investment is cautiously conducted.

Third, the attention should also is paid to organization chart of local government in special zones. Law on local government organization, which has a chapter with four articles, have formatted the model of special zones. Therefore, the consistency between the two laws should be ensured.

Are there People’s Councils in special zones?

Due to the requirement of law synchronization, some issues are raised. Specially, are special zones under the central or provincial governments? To make the zone dynamic, how is the apparatus organized? Is there a People's Council?

"Pursuant to the law, the local government has the People’s Council and People’s Committee, but the special zones are a new model without People's Council. On the other hand, in principle, the government is subject to the supervision of the People's Council”, Van raised questions “the point is that whose supervision are the leader and the People's Committee will be under? The model will be organized based on the form of leadership or collective regime?"

Previously, the Permanent Government held a meeting regarding special zones. At this meeting, Prime Minister Nguyen Xuan Phuc emphasized the determination to establish the best law, ensuring the sustainability, long-term development and the international and regional competitiveness.

Phuc agreed to establish a superior institutional framework which is beyond the existing laws and has specific policies in the spirit of equal competition without discrimination between domestic and foreign investors.