The plan, which will to combine Districts 2, 9 and Thu Duc into one administrative unit and make it an "innovative urban area," has been submitted by the municipal Home Affairs Department to the Ho Chi Minh City People’s Committee.

The department has come up with the plan following a meeting between Prime Minister Nguyen Xuan Phuc and the city on May 8.

The plan to make a "city within a city," temporarily called the "Eastern Town," won the PM’s endorsement.

This area has been in the making since 2017. City authorities said back then that the plan would generate a bright future for both local residents and businesses.

It would encompass the hi-tech park in District 9, the university precinct in Thu Duc District and the new urban area and financial center on the Thu Thiem Peninsula in District 2 to make one innovative hub to serve the city’s biggest plan to turn itself into a smart city.

The "Eastern Town" is also expected to contribute to the establishment of value added chains based on high technology, modern technical and social infrastructure of international standards, and effective financial support for businesses.

It was to play a key role in linking scientific and technical research with commercial production to lift residents’ lifestyle to "international standards."

Le Van Thanh of the HCMC Institute for Development Studies had said: "This will be Vietnam's Silicon Valley."

The innovative hub would cover more than 22,000 hectares (54,300 acres) with a population of over 1.1 million. Once the plan is implemented, HCMC will have 22 instead of 24 districts.

At the May 8 meeting, PM Phuc, while endorsing the merger of districts, said its official name will be decided later. He also assigned the Ministry of Justice to guide the city on the next steps to take.

Temporary setback

Earlier this month, the Construction Ministry had put a spoke in the plans saying there was no precedent in the country to establish "a city inside a city" by combining three districts.

The ministry was responding to an April letter from city authorities that asked for the ministry’s feedback on steps to implement this plan.

The ministry also said that there was no legal framework to establish such an area, and noted that the resolution on preferential mechanisms and policies aimed specifically at developing HCMC, approved by the National Assembly in 2017, does not have any regulation on setting up a city inside a city.

Furthermore, while HCMC has been planning on developing the innovative and highly interactive urban area in the eastern part, it has not made clear if there is a general urban plan for it and whether such a plan has been studied and approved, the ministry said.

Later, at the meeting with the PM, the construction ministry said the city had asked for its guidance while not having a complete picture of the master plan.

The ministry felt that such a plan should be dealt with by the Ministry of Home Affairs and the National Assembly, Vietnam’s parliament.

The home affairs ministry should guide HCMC on making proposal for its plan as a special mechanism for the southern metropolis, the ministry said.

At a 2018 meeting, the city's Party Chief, Nguyen Thien Nhan, had said if the city fails to connect the three districts, it will be unable to turn startup ideas into reality, which would be a huge waste of public resources.

The "innovative urban area" was part of a plan to turn the country’s largest city into a smart city by 2020.

Its ambition was to use scientific advances to resolve the problems the city faces, including rapid population growth, unsustainable economic growth, inadequate forecasting, planning and management, inadequate healthcare, education and public transportation, pollution, and inefficient public administration.