The Thu Duc City will be formed, starting January 1, by merging three eastern districts – 2, 9 and Thu Duc.

The Standing Committee of the National Assembly, the legislative arm of Vietnam, approved the government’s resolution to give birth to this new city at a meeting Wednesday.

Minister of Home Affairs Le Vinh Tan said the three districts have an important position in the Southern Key Economic Zone (SKEZ), which comprises HCMC, the industrial hubs of Dong Nai and Binh Duong, the cash crop province of Binh Phuoc, the maritime transportation hub of Ba Ria-Vung Tau, Tay Ninh Province, and two Mekong Delta provinces of Tien Giang and Long An.

Major routes linking HCMC and other southeastern localities run through or in the vicinity of the three districts.

Last year, the three districts contributed one-third of the HCMC’s gross regional domestic product (GRDP), higher than the provinces of Binh Duong and Dong Nai.

According to the government’s resolution, the strong development of the three districts in terms of banking, finance, industry, commerce, services and tourism, along with rapid urbanization and increasing population density, "has prompted the demand for the reorganization, through their merger into one administrative unit."

With the establishment of Thu Duc City, HCMC can contribute even more to the nation’s economic growth and boost the development of the SKEZ, boosting the southern metropolis’ regional and global profile, it said.

Phan Thanh Binh, chairman of the NA Committee for Culture, Education, Youth, Adolescents and Children, said Thu Duc City "should be given more power and should not be treated as a district-level unit." The chairman of Thu Duc City should have powers equivalent to that of HCMC’s vice chairman, he added.

"We’re going to build it into a locomotive for development, not just a city managed by HCMC," he said.

HCMC chairman Nguyen Thanh Phong said that once it is established, Thu Duc will help streamline the apparatus for the city, with around 644 officials leaving the service.

As planned, the new city will spread 211 square kilometers and house more than a million people. It is expected to contribute 30 percent of the city’s economic growth and 7 percent for the nation's per year.

Once the Thu Duc City is establsihed, HCMC will have a sub-city and 21 districts.

The plan to combine Districts 2, 9 and Thu Duc into one administrative unit and make it an "innovative urban area" has been on the anvil since 2017.

City authorities had said back then that it would create 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, propelling the city’s plan to turn itself into a smart city, another master plan it had also nurtured since 2017.