Vietnam Suggests Six Kinds of Commodity Trades at IFC Meeting

Vietnam Suggests Six Kinds of Commodity Trades at IFC Meeting

Vietnam Plans to Launch International Financial Centre with Six Commodity Exchanges

Vietnam is set to launch its International Financial Centre (IFC) in Ho Chi Minh City and Da Nang by the end of the year, according to a proposal by the Ministry of Industry and Trade. The IFC aims to cover traditional goods markets and emerging financial and commercial products, with a focus on transparency, investor protection, and integration with international markets.

At the heart of the IFC will be a commodity and commodity derivatives exchange, where physical goods such as metals and farm produce will be traded. The proposed core exchange will be followed by five additional exchanges, each specialising in specific commodities and products.

1. Commodity and commodity derivatives exchange: This core exchange will facilitate trading of physical goods such as metals and farm produce.
2. Carbon credits exchange: Designed to facilitate transparent trading of carbon credits with proper measurement, reporting, and verification mechanisms.
3. Cultural and art products exchange: This exchange will list items with verified origins, cross-checked with domestic and international cultural asset databases.
4. Rare and precious metals exchange: This requires origin verification and includes measures to prevent money laundering and smuggling.
5. Green financial products exchange: Only products meeting environmental criteria issued by the Ministry of Finance and the Ministry of Agriculture and Environment will be listed here, with independent audit reports confirming their green status.
6. Specialized new digital trading platform: A sandbox platform for innovative models such as tokenized commodities and decentralized trading platforms, subject to strict data security and operational safety requirements.

The draft Government decree on imports and exports and distribution and operation of commodity exchanges at the IFC has been made public for comments. The decree proposes that exchanges follow the International Organisation of Securities Commissions principles to ensure transparency, prevent manipulation, protect investors, and allow connectivity with overseas exchanges.

A special customs mechanism for the IFC will apply to imported and exported products. The mechanism, included in the draft decree, features a maximum clearance time of eight hours, the use of AI and blockchain technology in declarations, and exemption from specialised inspections except for certain cases.

Every exchange must meet requirements in terms of data security and operational safety before official operation. The IFC will also include a digital trading platform for innovative models, serving as a sandbox for experimental models like tokenized commodities and decentralized platforms.

The proposed IFC is expected to boost Vietnam's position in the global financial market and attract foreign investors. With its focus on transparency, investor protection, and integration with international markets, the IFC is set to become a significant hub for commodity trading in Southeast Asia.

[1] Ministry of Industry and Trade proposes six types of commodity exchanges for IFC in HCM City. (n.d.). Retrieved from https://vietnamnet.vn/en/business/ministry-of-industry-and-trade-proposes-six-types-of-commodity-exchanges-for-ifc-in-hcm-city-720150.html

[2] Vietnam to launch International Financial Centre by the end of the year. (n.d.). Retrieved from https://www.vietnaminsider.vn/business/vietnam-to-launch-international-financial-centre-by-the-end-of-the-year-3501234.html

[3] Proposed commodity exchanges for International Financial Centre in Ho Chi Minh City. (n.d.). Retrieved from https://vietnamnet.vn/en/business/proposed-commodity-exchanges-for-international-financial-centre-in-ho-chi-minh-city-720151.html

[4] Draft decree on imports and exports and distribution and operation of commodity exchanges at the IFC published for comments. (n.d.). Retrieved from https://vietnamnet.vn/en/business/draft-decree-on-imports-and-exports-and-distribution-and-operation-of-commodity-exchanges-at-the-ifc-published-for-comments-720152.html

1. The core exchange at Vietnam's International Financial Centre (IFC) will be a commodity and commodity derivatives exchange, facilitating trading of physical goods like metals and farm produce.
2. A carbon credits exchange is proposed for the IFC, designed to enable transparent trading of carbon credits with proper measurement, reporting, and verification mechanisms.
3. The IFC will also include a cultural and art products exchange, listing items with verified origins, cross-checked with domestic and international cultural asset databases.
4. In addition, there will be a rare and precious metals exchange, which will require origin verification and measures to prevent money laundering and smuggling.
5. A green financial products exchange is planned for the IFC, with only products meeting environmental criteria issued by the Ministry of Finance and the Ministry of Agriculture and Environment eligible for listing.
6. To accommodate innovative models such as tokenized commodities and decentralized trading platforms, a specialized new digital trading platform will be incorporated into the IFC, operated under strict data security and operational safety requirements.

The proposed International Financial Centre is expected to boost Vietnam's position in the global financial market and attract foreign investors. With its focus on transparency, investor protection, and integration with international markets, the IFC aims to become a significant hub for commodity trading in Southeast Asia.

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