What Makes a Great Financial Center? | Jochen Biedermann of the WAIFC

For years, conversations about Vietnam’s financial future were mostly framed around potential. The country was growing quickly, foreign investment was increasing, and cities such as Ho Chi Minh City and Da Nang were frequently discussed as places that could play a larger role in regional finance. My conversation with Jochen Biedermann at the Vietnam Financial Forum suggested that the conversation is now changing. The question is becoming less about whether Vietnam can build a serious financial center and more about how quickly it can create the conditions required to make one work.

Jochen is the managing director of the World Alliance of International Financial Centers, an organization that connects financial centers across five continents. He also sits on the advisory council supporting the development of Vietnam’s international financial center in Ho Chi Minh City and Da Nang. His perspective is useful because he has seen many different models develop around the world and is quick to point out that there is no single formula that Vietnam can simply copy.

Some financial centers grew organically over centuries. London is the obvious example, with institutions, legal traditions, professional networks, and talent accumulated over generations. Others, such as Dubai and Abu Dhabi, were created deliberately through government action, investment incentives, infrastructure, and regulatory design. A third group has emerged more recently from technology and fintech ecosystems, where finance grew around digital platforms rather than traditional banks.

Vietnam sits somewhere between these models. The international financial center is clearly a government-led initiative, but Da Nang in particular already has a growing technology ecosystem that could allow it to develop differently from a traditional banking center.

Jochen believes several foundations have to be in place regardless of the model. The legal and regulatory environment must be credible. The broader economy needs to support growth. Physical and digital infrastructure must be strong, and international connectivity must make it easy for investors and professionals to move in and out. Above all, financial centers need talent.

Talent may be the most difficult part.

A financial center can offer tax incentives, modern buildings, and favorable regulations, but international firms still need accountants, lawyers, analysts, compliance specialists, fintech professionals, investment managers, and experienced executives. If those people are unavailable, companies will hesitate to establish serious operations.

Vietnam will inevitably need international talent during the early stages, but Jochen stressed that imported expertise should also help develop Vietnamese professionals. One approach used elsewhere is shadowing, where an experienced international executive works alongside a local deputy for several years. The goal is that the local professional eventually takes over rather than leaving the organization permanently dependent on foreign leadership.

That requires investment in local education, but education creates another challenge. Countries can spend heavily training talented young people only to watch the best graduates leave for London, Singapore, Hong Kong, or New York.

Vietnam is already familiar with this problem.

Many young Vietnamese study at international universities with the original intention of leaving the country after graduation. What has changed is that more of them are beginning to see opportunities developing at home. Careers that once appeared available only abroad are becoming possible in Vietnam, particularly in technology, finance, manufacturing, and entrepreneurship.

The challenge is making those opportunities strong enough to compete.

Jochen suggested that retaining talent is not simply about salary. Compensation matters, especially because Vietnam will be competing against established financial centers, but career advancement, professional development, and quality of life matter as well. A talented professional may earn more in another country, yet they may also be able to rise more quickly in Vietnam because the industry itself is expanding.

This is particularly relevant in Da Nang.

The city already has a substantial technology sector and a reputation for producing startups, but many companies eventually move to Ho Chi Minh City or Hanoi once they need more capital, customers, or employees. For Da Nang’s financial center to succeed, it needs to reverse part of that flow.

Jochen believes fintech could provide the bridge. Da Nang already has thousands of technology companies, so combining that technical capability with financial services feels like a natural direction. Embedded finance, digital payments, digital assets, and other fintech products can connect directly with the city’s existing strengths.

A regulatory sandbox could also give Da Nang a distinct role. International financial and technology companies entering Vietnam need somewhere to test products, understand local consumers, and adjust their business models before making larger investments. Da Nang could become that testing ground, allowing companies to experiment in a controlled environment before expanding into Ho Chi Minh City or Hanoi.

This would give the two locations complementary roles while still allowing some healthy competition.

Jochen was surprisingly open about competition between Da Nang and Ho Chi Minh City. He pointed to Dubai and Abu Dhabi, where two financial centers operate relatively close together while competing for similar clients. That competition does not necessarily weaken them. It can force both cities to remain responsive and innovative.

Vietnam’s official approach emphasizes complementary roles, with Ho Chi Minh City positioned as the broader financial center and Da Nang focusing more heavily on fintech, digital assets, sustainable finance, trade finance, and experimentation. Jochen believes that distinction makes sense, but he also sees value in allowing the two cities to compete for investment and talent within a common national framework.

Da Nang’s greatest advantage may ultimately extend beyond finance.

The city combines technology, logistics, tourism, and an unusually high quality of life. Professionals can work in a growing business environment while still living close to the beach, raising families, and avoiding some of the pressures associated with larger Asian cities.

Jochen pointed out that this matters more than financial planners sometimes realize. Senior professionals rarely make relocation decisions alone. Spouses ask whether they can build careers of their own. Parents ask about schools. Families consider healthcare, air quality, housing, and daily life.

A city that ignores these factors may offer an excellent job and still lose the candidate.

This is one reason Da Nang may be able to attract professionals who would otherwise choose a more established financial center. Its business ecosystem is smaller, but the lifestyle proposition is very strong. The city also occupies an important geographic position between Hanoi and Ho Chi Minh City, something that could become even more valuable if Vietnam’s planned high-speed rail eventually shortens travel between the three major regions.

Jochen compared this kind of connectivity with Hong Kong and Shenzhen, where fast transportation effectively links different economic environments. Da Nang already has an airport very close to the city center and the beach. Better rail connections could strengthen its position as a central meeting point between Vietnam’s political and commercial capitals.

Still, Vietnam is entering a competitive regional environment. Singapore already sees itself as the financial gateway to Southeast Asia. Kuala Lumpur, Bangkok, Manila, Jakarta, and other cities are developing their own financial and fintech initiatives.

Vietnam does not need to become another Singapore, but it cannot ignore the competition.

Jochen identified several areas where continued progress will be necessary, including capital movement, market accessibility, anti-money laundering standards, and the practical infrastructure international investors expect. None of these challenges is impossible, but they require steady implementation.

That may be the most important shift taking place now. Vietnam has spent years talking about what it could become. The legal framework for the international financial center now exists, investors are paying attention, and international advisers are becoming involved.

The discussion is moving from possibility toward execution.

Da Nang’s role may become especially interesting because the city does not have an established financial identity that it must protect. It can experiment. It can connect finance with technology, create regulatory sandboxes, support sustainable finance, and develop an ecosystem that looks different from Ho Chi Minh City.

If it succeeds, its greatest advantage may be precisely that it does not try to become a smaller version of somewhere else.

The next few years will show whether Vietnam can connect the pieces: regulation, capital, talent, technology, infrastructure, and quality of life. Jochen’s perspective made one thing clear, however. Financial centers are not created by buildings or announcements alone. They emerge when people, institutions, and markets begin functioning together.

Vietnam has already made the decision to build one. Now the more difficult work begins.