Donors pledge record 5.4 billion dollars to Vietnam
HANOI — International donors on Friday pledged a record 5.4 billion dollars in official development assistance (ODA) to communist Vietnam for 2008, almost 20 percent more than this year.
World Bank country chief Ajay Chhibber said the grants and soft loans from nations, international development agencies and non-governmental organisations would help reduce poverty and protect the environment.
More than half of the funds will go to infrastructure such as highways, ports and energy facilities in the developing country that is experiencing more than eight percent economic growth and aims to reach middle income status by 2010.
Multilateral agencies made over 2.5 billion dollars in pledges -- with 1.3 billion dollars from the Asian Development Bank, 1.1 billion dollars from the World Bank and 90 million from United Nations agencies.
Japan topped the list among bilateral lenders, pledging 1.1 billion dollars, followed by a European Union total of 962 million dollars, South Korea with 286 million dollars and the United States with 114 million dollars.
International non-government organisations pledged 250 million dollars.
Foreign and Vietnamese officials said the pace of implementation would need to be sped up after less than two billion dollars were actually disbursed this year, in many cases due to delays caused by red tape.
However, Chhibber, speaking at the end of the two-day donors' meeting in Hanoi, said "Vietnam is making effective use of ODA. The rate of satisfactory outcomes of projects in Vietnam is higher than anywhere else in the world."
He said that many of the delays were due, in part, to the large proportion of infrastructure projects, saying: "When you commit for infrastructure projects, they take two to five years, sometimes longer."
Donors at the meeting complimented Vietnam on its rapid economic growth and poverty reduction but also urged it to speedily implement all its commitments after joining the World Trade Organisation this year.
The United States and European Union were among donors calling on Vietnam to do more to improve their human rights record, fight corruption and protect the environment, including helping global efforts against climate change.
Agence France Presse - December 7, 2007.
As Vietnam grows richer, international donors give more
HANOI - International donors holding their annual meeting Friday pledged 5.4 billion dollars in official development assistance to Vietnam for 2008, an increase of 1 billion dollars over 2007. The total includes 1.35 billion dollars from the Asian Development Bank, and more than 1.1 billion each from the World Bank and the Japanese government. Most of the aid comes in the form of low-interest loans for infrastructure improvements, sorely needed by Vietnam's export-driven economy, which is growing at more than 8% per year.
Ajay Chhiber, the World Bank's representative in Hanoi, said the increase in aid reflected the fact that donors had found that "the rate of satisfactory implementation of projects in Vietnam is higher than anywhere else in the world."
Asked why Vietnam is receiving increasing foreign aid even as it is getting richer and attracting record amounts of foreign direct investment, Chhiber said there are "areas where it is very difficult to attract private investment."
He said these include large infrastructure projects, as well as those intended to benefit disadvantaged sectors of society.
Foreign donors urged Vietnam to move ahead on reforming cumbersome government bureaucracy and to combat corruption, as well as to permit greater political freedom.
The European Union noted that "too many Vietnamese citizens are still imprisoned or detained for the peaceful expression of their personal views," and called on the government to fulfill its international treaty obligations regarding freedom of expression.
Vietnamese Prime Minister Nguyen Tan Dung, addressing the meeting, responded that such demands violated Vietnam's rights under the UN charter, according to a European diplomat who requested anonymity.
Actual disbursement of aid continues to run far behind amounts pledged. In 2007, just 1.9 billion dollars of the 4.4 billion dollars pledged has been spent.
Donors said that stems partly from an overly centralized system which requires the prime minister's office to approve every project.
Minister of Planning and Investment Vu Hong Phuc said the government had begun to address all the donor's concerns, including those on coping with climate change and restraining Vietnam's rising inflation rate, currently nearing 10 about.
"Inflation is not caused by the government's monetary policies, but by changes in world prices," Phuc said.
Phuc also announced that for the next Consultative Group meeting in summer 2008, the government sought a poor, underdeveloped location in need of international aid, and had selected the northern town of Sapa.
Sapa is a mountain town popular with Western tourists as a vacation and shopping destination, due to its colorful ethnic minorities.
Deutsche Presse Agentur - December 7, 2007.
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