Da Nang’s Free Trade Zone: What to Know About Vietnam’s Upcoming First FTZ

September 18, 2025 Chief Editor 0 Comments 2 min read

Vietnam’s central city of Da Nang has launched work on its first Free Trade Zone (FTZ), a flagship project officials say could transform the coastal hub into a major logistics and investment gateway. The development, however, remains in its early stages and is not yet fully operational.

The FTZ was formally approved by the government in June under Decision No. 1142/QĐ-TTg, covering 1,881 hectares across seven functional areas in Liên Chiểu Ward and Hòa Vang Commune, according to the Hong Kong Trade Development Council (HKTDC).

Here are key things to know about the project:

Groundbreaking but not running yet
On August 27, Sun Group, one of Vietnam’s largest private developers, broke ground on the first licensed infrastructure project in Functional Zone 5. The zone is planned to house luxury resorts, wellness centers and duty-free retail, The Investor reported. While this marks the FTZ’s first visible step, Da Nang authorities stress the broader zone is still under planning and infrastructure rollout.

What the FTZ covers
According to state media outlet VietnamPlus, the FTZ includes areas for logistics, services, trade, high-tech industries, healthcare, and eco-tourism. The city government has prioritized attracting “strategic investors” while aligning the zone’s operations with international trade and customs standards.

Investment and incentives
Officials say the FTZ will offer favorable conditions to lure both domestic and foreign investment, including tax breaks and simplified customs procedures. However, policy frameworks are still being finalized and Da Nang is working with ministries in Hanoi to build legal clarity for investors, VietnamPlus noted.

Strategic role for central Vietnam
Analysts see the FTZ as part of Da Nang’s ambition to position itself alongside Ho Chi Minh City and Hai Phong as a key trade node. Its proximity to Liên Chiểu deep-sea port and central Vietnam’s growing industrial zones could make it a logistics hub for both ASEAN and Pacific trade routes.

Challenges ahead
The FTZ’s launch comes at a time when Vietnam is competing with regional neighbors for manufacturing and investment dollars. Infrastructure in several of the seven functional areas remains undeveloped, and local authorities face hurdles in streamlining regulations, ensuring environmental compliance, and building connectivity with airports and ports.

The bottom line
Da Nang’s Free Trade Zone has been formally established and construction has begun, but it is still far from being fully operational. For now, the project represents potential more than reality — investors and businesses will be watching closely as the city moves from plans and groundbreakings to functioning trade and logistics facilities.

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