ODA helps promote Vietnam's economic development
Ha Noi, July 7 (VNA) -- Planning and Investment Minister Tran Xuan Gia affirms that Official Development Assistance (ODA) sources have made an active contribution to increasing Viet Nam's economic growth and improving its population's living conditions.
Foreign donors pledged more than USD 17 billion, including 15 percent of non-refundable aid and 85 percent of soft loans, for Viet Nam through eight donor group's consultative meetings between 1993 and 2000, according to the minister.
Between 1993 and May 2001, Viet Nam and its foreign donors signed programmes and projects capitalized at USD 13.4 billion, accounting for 76.9 percent of the ODA capital committed by the donors, of which USD 11 billion was for soft loans and USD 2.4 billion for non-refundable aid, says Duong Duc Ung, Director of the External Economic Relations Department of the Planning and Investment Ministry.
About 27 percent of Viet Nam's ODA was channelled into transport and communications; 24 percent into energy; 14 percent into medical, social, educational-training, and scientific-technical activities; 12 percent into agriculture-forestry-fishery; seven percent into water supply-drainage and environment; five percent into budgetary support; and seven percent into other sectors, he explained.
To date, Viet Nam's ODA has come from more than 20 donors through bilateral commitments and 15 others through multilateral commitments, mostly from Asia and Europe. The country has received technical support from Canada and humanitarian aid packages from non-governmental organizations in the United States.
Japan is Viet Nam's biggest donor, representing more than 40 percent of the country's ODA capital. The World Bank (WB) and the Asian Development Bank (ADB) have contributed approximately 21 percent and 13 percent, respectively.
From 1993 to last May, Viet Nam disbursed more than USD 8 billion. However, the country will begin paying for its ODA as from 2003 as 85 percent of its ODA is soft loans, according to Duong Duc Ung. Therefore, the Planning and Investment Ministry is working together with relevant ministries and agencies for a strategy of repayment to be submitted to the Government for approval.
According to recent forecasts, the world ODA sources are showing signs of slowdown as many donors are adjusting their ODA policies and conditions for each region. As a result, Viet Nam will face more problems in this regard, although its ODA sources have become more stable and durable.
The country and the ADB have agreed upon a programme on loans and technical support for 2001-2003. In addition, the two sides are discussing the latter's activities in the former between now and 2005, with focus on further reforms.
It has also worked with the WB for the list of investment projects in 2001-2003. The WB has decided to finance USD 250 million for Viet Nam's programme to eliminate hunger and alleviate poverty, while the country and its key donors are drafting a strategy for the programme.
Japan pledged to maintain the present amount of its ODA for Viet Nam during a visit to Japan by Prime Minister Phan Van Khai last month, despite Japan's reduction of ODA by 10 percent for other countries in the future.
Viet Nam's Communist Party Ninth Congress already approved the socio-economic development plan for 2001-2005, saying that the country will give 15 percent of its ODA to developing agriculture, irrigation, forestry, and fisheries in tandem with rural development and poverty reduction.
It will also reserve 25 percent for energy and industry, and another 25 percent for transport, communications, postal services, urban water supply and drainage. Up to 2005, Viet Nam will need about USD 11 billion of ODA for its development.
According to the World Bank director in Viet Nam, Andrew Steer, the ninth Viet Nam donor group consultative meeting is expected to take place in Japan on November 15-16 this year. Participants in the meeting will discuss a plan on Viet Nam's public investment spendings and determine a list of its investment projects in the next five years.
The WB and other donors have always supported the Vietnamese Government's economic reform efforts and will help promote this programme, affirmed the WB director.--VNA
