ADB OKs $15M Loan to Aid Poverty Reduction Program in Viet Nam
MANILA, PHILIPPINES - The Asian Development Bank (ADB) approved a new loan of $15 million to assist poverty reduction efforts in Viet Nam in coordination with a number of other development partners. In this Southeast Asian nation, a package of reforms that seeks to reduce structural weaknesses and improve the business environment, promote inclusive growth, ensure the protection of natural resources, and modernize governance is being carried out. The loan supports the implementation of Viet Nam’s Poverty Reduction Program within the framework of a multi-donor funded and World Bank-led Sixth Poverty Reduction Support Credit (PRSC6). The annual PRSC program started in 2002 as a tool for donors to strengthen the coordination in supporting Viet Nam’s comprehensive reform agenda. In Viet Nam, donors are supporting the government to accelerate reforms in accordance with its Socioeconomic Development Plan 2006–2010 (SEDP), which is considered the national poverty reduction strategy. The main objective of the Socioeconomic Development Plan is to reduce the poverty incidence to 10%-11% by 2010. The country has already made significant strides in reducing the poverty incidence, which was higher than 58% in 1993 to below 20% in recent years. “Viet Nam has achieved significant progress in reducing poverty in recent years, reflecting the Government’s strong commitment. Such efforts will continue to be supported by the community of development partners including ADB,” said Ayumi Konishi, ADB’s country director for Viet Nam. Over the last 20 years, Viet Nam’s economy has been transformed significantly. It has become one of the fastest growing economies in Asia, with an average gross domestic product (GDP) growth of 7.5% over the last decade. GDP per capita increased from $288 in 1993 to $716 in 2006, with a marginal increase in inequality. “Economic growth in Viet Nam has been largely equitable. But as the economic growth accelerates, income disparity can widen. Some groups have benefited less from economic growth and are vulnerable to social and economic marginalization. Low-income households face a vicious cycle of remaining poor due to difficulties in accessing health and education services,” said Mr. Konishi. There are also considerable disparities in poverty and poverty reduction across regions. Certain areas in the northern and central regions have a poverty incidence of over 30%. These regions are home to nearly 57% of the poor in Viet Nam. The loan is expected to help boost efficiency, accelerate economic growth and create jobs, as well as improve the quality of education, access of the poor to health services, promote a reformed social protection system and gender equality. The loan will also help secure land ownership and address the resettlement and compensation process and promote sustainable management of natural resources. The assistance will also help promote transparency and accountability in public financial management and modernize public administration. About ADB | 
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