WB commits further financial support for Vietnam

09:14 | 14/10/2017 Cooperation

(VEN) - The World Bank (WB) recently committed loans totaling US$4.08 billion for Vietnam from 2018 to 2020 and affirmed its willingness to further support Vietnam in the 2017-2022 period.

wb commits further financial support for vietnam

The decisions were included in the newly issued World Bank Group (WBG)’s Country Partnership Framework (CPF) for Vietnam.

The loans will be supplied by two separate mechanisms. Having graduated in June from the International Development Association (IDA) due to its economic development, Vietnam is now eligible for IDA18 transitional support. Total transitional support for Vietnam in fiscal years 2018-2020 is set at US$2.2 billion.

The other source of loans available for Vietnam under the CPF is from the International Bank for Reconstruction and Development (IBRD), which are provided at terms similar to the IDA18 loans. The amount of these loans depends on the global economic and financial situation and the borrowing demand of other countries. IBRD’s loans for Vietnam in the 2018-2020 period are expected to total US$1.88 billion. Due to the uncertainty of supply and demand, the WB’s lending program will be adjusted throughout the CPF period. WBG will maintain tight coordination with the Vietnamese government in making borrowing plans. The new loans will finance the government’s medium-term investment plans.

The CPF lays out the WB’s support principles for the next five years and proposes specific activities for the first three. The CPF will support Vietnam in implementing its five-year socioeconomic development plan for the 2016-2020 period, as well as in balancing economic development and sustainable environment, promoting equality, and enhancing the capacity and accountability of state authorities. Through the CPF, the World Bank will continue supporting Vietnam’s development to help it reach a higher level among middle income countries and access new loans from the IDA - a source of WBG’s funding for low-income countries.

The CPF will be implemented with considerable engagement of local governments, applying multi-sector and regional approaches to deal with gender issues through consultancy support, analyses, policy dialogues, lending and establishing strategic partnerships.

WBG has pledged to support Vietnam’s transitions and major reforms, including developing the private sector, improving public sector efficiency, promoting vocational education and positive changes in the labor market, intensifying poverty reduction efforts, and dealing with environmental problems.

Nguyen Huong