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ADB, Viet Nam Sign a Loan of $15 Million for Poverty Reduction

HANOI, VIET NAM (30 November 2005) - The Asian Development Bank (ADB) and the State Bank of Viet Nam (SBV) today signed a loan in the amount of $15 million to help Viet Nam further reduce poverty.

Governor Le Duc Thuy represented the State Bank of Viet Nam, while Bradford Philips, Country Director at ADB’s Resident Mission in Viet Nam, signed for ADB.

ADB and SBV signed a $15 million program-based loan to support the Government’s poverty reduction program. The loan is to support the policy framework of the Fourth Poverty Reduction Support Credit (PRSC 4), a program funded by several other development partners led by the World Bank in support of the Government’s Comprehensive Poverty Reduction and Growth Strategy (CPRGS).

This loan is a multisector program loan designed to strengthen Viet Nam’s reform program on three fronts as identified in the CPRGS. The program will advance the transition of Viet Nam’s economy to a market economy by reducing structural weaknesses and by improving business environment; promote socially inclusive development; and help modernize governance.

The loan will contribute to financing the adjustment costs in implementing the policy framework of the PRSC 4 program in support of the Government’s deepened reform program for poverty reduction. The State Bank of Viet Nam is the executing agency for this loan.

“ADB looks forward to continuing close cooperation among donors with the Government in implementing effective policy reform, eliminating critical structural weaknesses, promoting socially inclusive development, and modernizing governance and public administration with the full and active participation of all key stakeholders,” said Mr. Philips.

The loan comes from ADB’s concessional Asian Development Fund, with a 24-year term including a grace period of eight years. Interest is set at 1% per annum during the grace period and 1.5% per annum for the rest of the term.

ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through pro-poor sustainable economic growth, social development, and good governance. Established in 1966, it is owned by 64 members – 46 from the region. In 2004, it approved loans and technical assistance totaling $5.3 billion and $196.6 million, respectively.

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