Vietnam is drafting the Urban Development Law as the country enters a new era. The enactment of the law is not merely about adding another piece of legislation on urban management, but also presents an opportunity to establish institutions capable of driving growth, fostering innovation, and promoting international integration.
Mechanisms must match the mission
The draft Urban Development Law was submitted to the first extraordinary session of the 16th National Assembly as the country works toward its goal of becoming a developed, high-income nation by 2045.
The most important question is not what additional mechanisms should be granted to special-class cities, but what mission such cities should undertake in the country's national development. From this perspective, the draft law's opening provisions, from Articles 1 to 4, should make it clear whether the law is intended to promote the development of major cities in general or establish a distinct framework for special-class cities that serve as national growth engines. Should preferential mechanisms be granted based on a city's size or on the development mission assigned to it?
For many years, when special-class cities are mentioned, attention has primarily focused on special mechanisms, such as stronger decentralization, greater autonomy, more flexible financial arrangements, and broader decision-making powers. All these mechanisms are necessary, but they do not answer the core question: Why should a city be granted such special powers in the first place?
International experience shows that cities such as Singapore, Shanghai, Seoul, and Dubai have emerged as globally competitive hubs not simply because they have been granted greater powers than other localities. What matters is that these cities have been entrusted with national missions and provided with institutional frameworks tailored to fulfill them.
A special-class city should not be viewed as a higher tier of administration, much less as a title to be expanded or a package of preferential policies for selected localities. At its core, a special-class city is a national development institution.
The State grants special mechanisms not merely because a city has a large population or high GRDP, but because it is entrusted with responsibilities that other localities do not undertake, driving growth, pioneering innovation, piloting new institutional arrangements, promoting international integration, and generating spillover effects nationwide. In other words, special mechanisms are not the end goal but rather a means to fulfill a national mission.
A review of major Politburo resolutions concerning Ho Chi Minh City shows a clear evolution in the city's role in national development. Resolution No. 16-NQ/TW, issued in 2012, identified Ho Chi Minh City as the country's economic locomotive. Resolution No. 31-NQ/TW, issued in 2022, expanded the city's role to that of a regional center for innovation, finance, science, and technology with enhanced competitiveness. By 2026, Resolution No. 09-NQ/TW set out a vision for Ho Chi Minh City as a special-class city with global competitiveness, at the forefront of institutional innovation, and entrusted with strategic missions in the country's new era of development.
This evolution also places new demands on the Urban Development Law. The law should not merely facilitate faster urban development, but establish a legal framework for growth poles capable of driving the economy, fostering innovation, and spreading development momentum across the region and the country.
Only for cities with sufficient capacity
If special-class cities are defined as national development institutions, the scope of application of the Urban Development Law should be clearly and strictly stipulated from Articles 1 to 4. Unless the draft law clearly defines the criteria for identifying special-class cities and the conditions for applying special mechanisms, it could easily be interpreted as allowing any major city to become eligible.
Meanwhile, the spirit of the Party Central Committee's resolutions concerning Ho Chi Minh City indicates that preferential mechanisms should be granted only to cities entrusted with special national missions, with sufficient capacity to fulfill them and subject to commensurate oversight and evaluation. The designation of a special-class city cannot be based solely on population, land area, or budget contributions, but must first and foremost take into account the national mission assigned to the city and its capacity to fulfill that mission.
A special-class city must first and foremost have a clearly defined national role, serving as a growth pole, an innovation hub, a gateway to international integration, and a driver of development across the region. It must also have the capacity to shape institutions and be capable of piloting new policies and governance models before reviewing and refining them for replication nationwide.
This should be accompanied by international competitiveness, reflected in the city's ability to attract talent, technology, capital flows, research centers, innovative enterprises, and international financial activities.
The most important criterion is the city's ability to generate spillover effects. A special-class city should not develop for its own sake, but must serve as a growth driver for the region and the country through infrastructure connectivity, technology transfer, high-quality human resource development, the formation of value chains, and new governance models. Alongside qualitative criteria, a system of key performance indicators (KPIs) should be developed to monitor and assess the effectiveness of special-class cities.
These indicators should serve not only as a basis for recognition but also for periodic reviews of whether special mechanisms should remain in place. The greater the powers granted, the higher the requirements for performance and accountability. Therefore, a special-class city should be assessed both by the pace of its own development and by the extent to which it generates spillover benefits for the country.
The Urban Development Law should not be viewed as legislation designed for major cities, much less as a basis for multiple localities to pursue special-class status simply to gain access to preferential mechanisms. Without a clear underlying philosophy, there is a risk of creating a tendency to seek special mechanisms or broaden the law's scope of application. This would dilute national resources and undermine the original purpose of special mechanisms.
Conversely, when special-class cities are defined as national development institutions, the scope of the law will naturally be limited. Only cities that genuinely possess the necessary capacity, are entrusted with strategic missions, and have the potential to generate broad spillover effects should be granted preferential mechanisms.
A country seeking to make a major development leap needs strong foundations capable of creating breakthroughs. Such foundations cannot be built by extending special mechanisms to an increasing number of localities. What makes a city special is not the number of mechanisms granted to it, but the national mission it has the capacity to undertake and the responsibilities it must shoulder.
A special-class city is a national development institution selected in response to the country's strategic requirements. Special mechanisms must stem from the national mission. This should also be the guiding philosophy of the Urban Development Law, enabling it to serve as an enabling legal framework for Vietnam's new stage of development.
