PM lauds work of ADB, IMF and World Bank

Only half of the project funding received from the ADB, IMF and World Bank has been disbursed

Prime Minister Phan Van Khai praised the support these organisations had given Vietnam at the 10th anniversary celebrations of the financial institutions’ activities in Vietnam.
Khai also praised the performance of the State Bank which coordinated the activities of the organisations and their various Vietnamese counterparts at all sectors and levels.
“The last 10 years were a challenging time as Vietnam tackled many challenges, ranging from widespread malnutrition to a lack of capacity in the public sector, from inadequate infrastructure to a lack of foreign investment,” the prime minister said.
“These international financial institutions provided enormous support to improve the lives of millions of Vietnamese poor and to help the Government of Vietnam expedite various reforms.”
The three organisations have altogether provided $7.7 billion of soft loan to 80 projects and nearly $300 million in grant funds to Vietnam. However, only half of the total funds have been disbursed so far.
State Bank governor Le Duc Thuy said one of the reasons behind the low disbursement ratio was the slow rate of projects’ execution.
A great number of projects are in the infrastructure development sector, but site clearance remains very slow.
Thuy promised that the government would make greater efforts to accelerate the disbursement ratio to improve the aid’s effectiveness and reach development targets.
The International Monetary Fund (IMF) has been an active development partner in Vietnam since 1993, providing financial support through a 1993 loan of about $190 million, a three-year loan in 1994-1997 of $500 million and a three-year Poverty Reduction and Growth Facility of $400 million covering the period 2001-2004.
Resuming its activities in Vietnam at the same time as the IMF, the World Bank has supported Vietnam financially with 35 projects in agriculture, infrastructure, health care and education. Some quantitative outcomes of this support have been access to electricity for two million people in the 32 poorest provinces, and building 2,606 communal health centres, and 60 health care posts in mountainous regions.
During the same period, the Asian Development Bank (ADB) provided Vietnam with 48 loans amounting to $2.7 billion, including support for the private sector as well as state projects, and 141 technical assistance grants for almost $98 million.
At the celebration, representatives of the three institutions expressed their desire to continue cooperating with the Vietnamese government on its road to modernisation and prosperity through commitment to an extended loan package.
In the next three years, the World Bank is committed to a lending programme in the range of $300-$800 million per year, in direct support of Vietnam’s poverty reduction objectives with a primary focus on four sectors – rural development, urban development, infrastructure and human development.
The ADB, meanwhile, announced that a loan of $975 million would be provided to Vietnam from 2004 to 2006 plus a grant of $15 million in technical assistance.