ADB provides US$85 million for rural infrastructure development in central Vietnam

Friday, 2014-12-26 18:03:04
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NDO – The Asian Development Bank (ADB) and the Government of Vietnam on December 26 signed a loan agreement for US$85 million in additional financing to scale up and expand investments in rural infrastructure in the central region.

The six provinces of Binh Dinh, Binh Thuan, Ha Tinh, Ninh Thuan, Phu Yen and Thua Thien-Hue are subject to the agreement.

Governor of the State Bank of Vietnam Nguyen Van Binh signed the agreement with ADB Country Director for Vietnam Tomoyuki Kimura.

“Built on the implementation experiences and lessons learned from the first phase the additional financing will continue addressing the rural infrastructure constraints for agriculture and rural productivity and improve the overall livelihoods of the project communities, said Kimura. “By taking the consistent approach with that of the on-going project in the Central Highlands, we aim to support the government’s national and provincial rural development priorities and increased development impacts in the Central Region.”

The original Integrated Rural Development Infrastructure Sector Project was approved by the ADB board in October 2007 with a total project cost of US$168.17 million, out of which ADB provided US$90 million. The project targeted critical rural infrastructure in 13 provinces in the Central Region, including rural roads, irrigation drainage and flood control systems, rural markets, domestic water supply schemes and coastal works.

As of August 2014, the project has achieved its intended outcomes, and has made a good contribution to meeting the provincial infrastructure development targets for boosting agricultural productivity and employment opportunities, improving access to public services, as well as reducing the exposure of the rural population to natural disasters.

Despite the achievements, much work is needed to reduce infrastructure constraints to production, diversification, and economic growth. The US$85 million loan for the additional financing of the project is ADB’s timely response to the Government’s priority in rural development and consistent with ADB’s country partnership strategy, 2012-2015 for Vietnam.

The additional financing will support improving and expanding irrigation infrastructure over four years in the six selected provinces based on their performance in the initial project.