Savan eCo City could possibly become the most sophisticated offshore financial centre in the world.
For those familiar with Iskandar Region in Johor, there is a similar comprehensive development taking shape, quietly at the moment, but with determination and vigour in the central province of Savannakhet in Laos PDR.
Savannakhet is the second largest city of the Lao PDR and the central government has selected this location to launch in 2015, Savan eCo City, (“SeCC”) which is an economic zone that encapsulates tourism, hospitality, resorts, commerce, a financial and offshore centre, and a legislative and administration centre within this zone.
Situated on the Lao side of the Mekong river, it is connected to Thailand by the Friendship Bridge which can accommodate more than 2 million vehicles each year via the East-West Corridor linking Vietnam with Myanmar. As part of China’s One Belt One Road (OBOR) initiative to power the whole of the southern China and the ASEAN region into a vibrant social and economically wealthy region, the SeCC is in one the most strategic locations.
The main clusters of development will comprise the following:
Adjacent to the entry point from Thailand, it is a collection of buildings that include a duty-free complex, hotels, an entertainment complex and theme parks.
A Great Phaya Naga which will house a dinosaur museum and a man-made beach lagoon park with numerous recreational facilities.
Administrative and Legislative
Centre Featuring a one-stop service centre for various types of licenses, registrations, approvals and visa applications which can be processed here in a convenient and prompt manner.
Financial and Business
District This area serves as a hub to support businesses and private wealth management. There are concrete plans to house offshore banks, high security repository, an international financial exchange and facilities for other financial services.
Light Industrial District
This is for the convenience of international and regional companies wanting to set up manufacturing, production, warehousing or light assembly operations.
Asian Food Districts
To make available various Asian cuisines for the expected large numbers of expatriates working and living in SeCC.
Capable of hosting up to 32,000 people at a time.
The government has decreed various tax holidays and other incentives for foreign investors into the SeCC.
For example, the incentives that have been decreed and made into law include:
Various tax exemptions including tax holiday for up to 10 years from first profit;
Personal income tax of only 5%;
The creation of 100% foreign-owned enterprises;
Competitive land prices;
Flexibility with regard to use of property, lease period, employment of labour, entry and residency rights; and
Extensive customs duties exemptions.
Clearly, there is a concerted effort to shift the Lao economy from agriculture and hydro electricity production to services which is expected to lift more of the country’s population above the poverty line and help Laos graduate from Least Developed Country by 2020.