Projects

Project Information

Central Region Livelihood Improvement Project

Borrower

Socialist Republic of Viet Nam

Date of Approval

17 December 2001

Project Description

The central region of Viet Nam is one of the poorest in the country. It has approximately 22 million people, which includes 11 indigenous ethnic minority groups. The proposed project area consists of 10 upland districts among four provinces within the north central coast and central highlands subregions. The four selected provinces are all poor, with a per capita expenditure that is 68 percent of the national average. Seventy eight percent of the provinces' 2.8 million people are rural. The Project will be the first major externally supported integrated socioeconomic development initiative in the area, and will establish a sound social capital foundation on which to undertake project activities. The Project has been designed to upgrade the socioeconomic infrastructure and to increase employment and income generating opportunities for the rural population and is fully in accord with the poverty reduction strategy of the Asian Development Bank (ADB) and the 2001-2005 country strategy's focus on the central region of Viet Nam. The Project is also in accord with the Government of Viet Nam's poverty reduction program for rural populations in the mountainous, remote border areas (known as "Program 135") and shares its objectives of decentralizing decision making and increasing capacity of communities in those areas.

Loan Amount and Terms

The loan will be the equivalent in various currencies of SDR 34,058,000 (US$43.09 million) from ADB's Special Funds resources, with a maturity of 32 years including a grace period of 8 years and an interest charge of 1 percent per annum during the grace period and 1.5 percent per annum thereafter to be paid semiannually.

Period of Utilization

Until 30 September 2007

Implementation Arrangements

A project management unit (PMU) will be established in each provincial department of planning and investment (DPI) and, will be responsible for overall management of the Project. Each PMU will be staffed with a project director and support staff. A team of international nd domestic consultants will provide advisory support to each PMU to ensure effective implementation of the Project. Various local government and quasi-governmental agencies will provide technical support under the Project. The district-based Department of Agriculture and Rural Development will assist with implementation of the household food security and income generation components by supporting farmer-managed demonstrations to improve agricultural production, and by providing engineering design support for irrigation construction and upgrading. The Viet Nam women's union will assist in implementation of the household food security component and the microfinance services subcomponent. The district-based Department of Transport will provide engineering design support for rural road construction and improvement. Nongovernment organizations (NGOs) and local training institutions will support implementation of the community development and institutional strengthening components under the Project.

Executing Agencies

The provincial people's committees of Kon Tum, Quang Binh, Quang Tri and Thua Thien Hue, and the Viet Nam Bank for Agriculture and Rural Development.

Procurement

Civil works, materials, and equipment will be procured in accordance with ADB's Guidelines for Procurement. Contracts for large-scale civil works, such as rural roads and irrigation, will be awarded to prequalified contractors through local competitive bidding procedures acceptable to ADB. For small-scale civil works of less than US$10,000, procurement on the basis of comparison of at least three quotations from local contractors will be followed. The communities themselves may carry out small works costing US$1,500 equivalent or less. Contracts for supply of materials, vehicles, and equipment packages will be procured using international shopping procedures for contracts estimated to cost between US$100,000 and US$500,000 equivalent. Direct purchase procedures will be followed for small or off-the-shelf items valued at less than US$100,000.

Consulting and Other Contract Services

A total of 126 person-months of international and 449 person-months of domestic consulting inputs will be required, in addition to a consortium of international NGOs. The consultants and NGOs will be recruited in accordance with ADB's Guidelines on the Use of Consultants and other arrangements satisfactory to ADB for the engagement of domestic consultants. The project also will contract out services to local institutions such as the Center for Rural Development of Hue University and the MPI BusinessTraining College, and local mass organizations to conduct training-of-trainers, beneficiary training, and participatory rural appraisal exercises.

Estimated Project Completion Date

31 March 2007

Project Benefits and Beneficiaries

The Project's target population is the rural poor in 10 upland districts in four central region provinces. Approximately 65,000 households comprising about 348,000 people are expected to benefit from the project through increases in incremental household incomes due to increased agricultural production, improved rural infrastructure, and use of improved technology for on- and off-farm production activities. Nonquantifiable benefits will also accrue to the target population through their acquisition of new or improved skills; increased earning opportunities and incomes; better community organization; and greater access to productive assets, infrastructure, and economic and social services. They also will benefit more broadly from improvements in the abilities of local government bodies to deliver services in response to community demand.