ADB, Viet Nam Sign US$1 Million Grant to Improve Urban Environment in Central Region

News Release | 12 May 2005

HANOI, VIET NAM (12 May 2005) - ADB and the Government of Viet Nam today signed an agreement for a US$1 million grant to help improve the quality of life and livelihoods of poor communities in Viet Nam's central region through an innovative urban environmental improvement project.

The grant is from ADB's Japan Fund for Poverty Reduction (JFPR), financed by the Government of Japan.

Signing on behalf of ADB at the ceremony, held this morning at the State Bank of Viet Nam, was Bradford Philips, Country Director of ADB's Viet Nam Resident Mission. Phung Khac Ke, Deputy Governor of the State Bank of Viet Nam, signed on behalf of the Government. Also present at the signing ceremony was Yasukata Fukahori, First Secretary and Head of Economic Section of the Embassy of Japan.

The project will help break the cycle of poverty by addressing different aspects of the problem, including resource scarcity, poor health, and lack of opportunities.

It will use a community-based approach to address problems of annual flooding, poor drainage, and unhygienic environment, and provide skills training, jobs, and income-generating opportunities.

The town of Tam Ky in Quang Nam Province, which has a high poverty rate and suffers frequent flooding, will serve as the pilot area.

"The project will help expand the benefits of urban improvements to the poor through a participatory approach, with external assistance serving as a catalyst for community development," says Mr. Philips.

"Good health, hygiene, and a sanitary environment coupled with adequate skills will result in a productive labor force and help break the cycle of poverty."

Although various government and donor programs have been carried out to improve facilities and to provide urban infrastructure services in towns in the central region, a majority of the population, particularly the poor, still does not have access to these services.

The grant will fund small-scale subprojects, such as tertiary drainage, alleyways and footpath improvements, water supply connections, and household sanitation facilities to mitigate flooding, environmental hazards and diseases.

It will provide transfer stations, small-scale equipment, and supplies needed for a community-based solid waste management project that will benefit around 3,700 previously unserved households.

This component will also provide jobs to the poorest members of the community by establishing a fee-based collection system to pay for groups that will collect, recycle, and dispose of solid waste.

It will also provide skills training on construction and carpentry, waste collection and recycling, sanitation, and other environment-related work to enable the poor to gain jobs.

"The high level of community involvement in the planning and implementation of the project will increase community ownership of these undertakings and improve the prospects for sustainability," says Januar Hakim, an ADB Urban Development Specialist.

The Ministry of Construction will execute the project, which will be carried out over three years. The Government and beneficiaries will contribute $200,000 toward the project's total cost of US$1.2 million.

The JFPR was set up in 2000 with an initial contribution of Y10 billion (about $90 million). The Fund now stands at over $344 million, of which $153 million have been committed.