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  • Yen Bai

ADB provides loans for three projects

VGP - The Vietnamese Government and Asian Development Bank (ADB) signed today three loan agreements totaling US$251 million.

December 21, 2012 3:09 PM GMT+7

They money will be used to strengthen teaching skills and courses to close labor gaps with better education, enhance capacity of the power transmission network to ensure reliable electricity supply and improve flood and drought risk management and mitigation.

At the signing ceremony, the Government was represented by Mr. Nguyen Van Binh, Governor of the State Bank of Viet Nam and ADB was represented by Mr. Tomoyuki Kimura, Country Director for Viet Nam.

“Although Viet Nam has experienced rapid growth over the past two decades, future growth will depend on a labor force skilled enough to meet the needs of the job market, a reliable electricity supply to meet rapidly growing energy demands, and the country’s capacity to mitigate risks and vulnerabilities posed by flood and drought events,” said Mr. Tomoyuki Kimura.

Following the track record of booming economy since 1980s, Viet Nam has recently been classified as a lower middle income country. However, challenges remain. At present less than 30% of young workers – accounted for half of the work force – have completed upper secondary schooling. Despite enrolment and completion rates for upper secondary have moved up sharply over past decade, academic performance remains relatively low compared with other ASEAN countries.

A $90 million concessional loan from the ADB’s Asian Development Fund (ADF) for the Second Upper Secondary Education Development Project will focus on improving readiness of upper secondary school graduates for tertiary and vocational career development through enhancing upper secondary education quality to meet the international standards, increasing access and retention of disadvantaged groups with a special focus on girl and ethnic minority students coming from poor and near-poor households to upper secondary education, and strengthening planning and management of upper secondary education.

Recognizing the need to overcome current constraints in the power sector to ensure that rapidly growing electricity demand can be met in both economically and environmentally sustainable manner to sustain economic growth, the Government of Viet Nam approved in 2011 the National Power Sector Development Master Plan VII (PDMP VII).

The US$110.19 million loan represents the second tranche of the US$730 million power transmission investment program to Viet Nam that ADB approved in December 2011. It supports partial implementation of the PDMP VII to meet growing electricity demand of industrial, commercial and residential consumers throughout Viet Nam. The project also helps improve the operational effectiveness and efficiency of the National Power Transmission Corporation. Agence Francaise de Developpment (AFD) will co-finance project 2 with an additional Euro75 million.

Flood and drought events often have severe impacts on farming, food supply and infrastructure in Lower Mekong Basin. To support Viet Nam’s efforts to improve flood and drought risk management and mitigation and reduce economic losses, ADB provides a loan of $45 million and the Australian Agency for International Development (AusAID) provides a grant of $5.9 million.

The project will pair infrastructure upgrades in Dong Thap and Tien Giang provinces with community-based disaster risk management and enhanced regional forecasting to improve flood and drought preparedness, development of design criteria for flood and drought mitigation measures in the Mekong Delta and assessment of transboundary flood management options.

“This project is a good example of partnerships with development partners,” said Mr. Kimura. “The project components supported from the grant by AusAID will ensure that the investment in infrastructure upgrading and development will be complemented with capacity building and studies to equip communities with the skills to plan, predict, and prepare for flood and drought events.”

The project is part of the Greater Mekong Subregion Flood and Drought Risk Management and Mitigation project which also supports activities in Cambodia and the Lao PDR.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region. In 2011, ADB approvals including cofinancing totaled $21.7 billion./.

By Thuy Dung