Viet Nam: MFF: Water Sector Investment Program

Sovereign Project | 41456-013

Summary

The Program will assist water supply companies in Viet Nam to strengthen their business practices and improve their performance. The Program will also support a capital investment program in water companies and cofinance the National Non Revenue Water (NRW) Program. The Development Program will utilize a MFF with a view to providing longer-term support to the institutional reform of the Viet Nam Water Sector for the next ten years. The MFF will be used to leverage parallel cofinancing, and most importantly to prepare access to commercial finance and increased private sector participation. The funds will be made available in tranches through loans. Four pilot cities, Da Nang, Hai Phong, Ho Chi Minh City (HCMC) and Hue were identified for project preparation in 2008. The first Periodic Financing Request (PFR1) of the MFF will only cover HCMC.

Latest Project Documents

Consulting Notices

See also: CMS

No notices are currently available for this project.

Procurement Notices

See also: Operational Procurement

No notices are currently available for this project.

Procurement Documents

No documents of this type are currently available for this project.


Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Public Communications Policy (PCP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Project Name MFF: Water Sector Investment Program
Project Number 41456-013
Country Viet Nam
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
MFF Facility Concept 0054-VIE: Viet Nam Water Sector Investment Program, MFF, $1 b
Ordinary capital resources US$ 1,000.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Private sector development
Sector / Subsector

Water and other urban infrastructure and services - Urban policy, institutional and capacity development - Urban water supply

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The Program will assist water supply companies in Viet Nam to strengthen their business practices and improve their performance. The Program will also support a capital investment program in water companies and cofinance the National Non Revenue Water (NRW) Program. The Development Program will utilize a MFF with a view to providing longer-term support to the institutional reform of the Viet Nam Water Sector for the next ten years. The MFF will be used to leverage parallel cofinancing, and most importantly to prepare access to commercial finance and increased private sector participation. The funds will be made available in tranches through loans. Four pilot cities, Da Nang, Hai Phong, Ho Chi Minh City (HCMC) and Hue were identified for project preparation in 2008. The first Periodic Financing Request (PFR1) of the MFF will only cover HCMC. Subsequent tranches would finance part of the National NRW Program and investment sub-programs for water companies in the other three cities, as well as other Vietnamese water companies.
Project Rationale and Linkage to Country/Regional Strategy

Sector Performance: ADB's Water and Sanitation Sector Assessment Strategy and Roadmap shows that Viet Nam's water sector has achieved significant gains in improving coverage for both water supply and sanitation in the last two decades. Official statistics for monitoring the achievement of Millennium Development Goals record that Viet Nam in 2006 reached 92% overall coverage for improved water supply compared to 52% in 1990. However, there are significant gaps in the quality and reliability of service, and in the efficiency and environmental sustainability of service delivery. Key areas requiring attention for water companies are: (i) financial sustainability; (ii) efficiency and accountability of decentralized sector institutions; (iii) data on utility assets and performance. The proposed program will address those three gaps in a significant manner. Furthermore, the level of NRW in Vietnamese cities is still unacceptably high, ranging from 15% to 40% . To meet Government targets and to improve the financial viability of water companies, considerable effort is required to identify the physical and commercial losses, and subsequently massively invest in a pipe replacement program. ADB will support operational work on the distribution networks necessary to identify NRW and finance pipe repair and replacement, as required. ADB's proposed methodology promotes ownership of the NRW reduction program by the respective water companies, by including NRW as a core function of overall operation and maintenance.

Policy Framework: The policy and legal basis for the sector is relatively strong, as the Government issued two key Decisions, detailing a clear vision, setting targets and implementation measures. Decree 117/2007/ND-CP transforms water from a social to a commercial commodity and requires water supply tariffs to be set to full cost recovery and Decision 1929/2009/QD-TTg sets ambitious targets for the water sector, in particular for NRW reduction to 25% by 2015, and 18% by 2020, from the current average of 30%. The objectives of the Government's current Socioeconomic Development Plan (SEDP) 2006 2010 in regard to the water sector include the provision of essential infrastructure, especially water supply and sanitation, to poor households in cities and towns across the country and enhancement of cost recovery for infrastructure investments by setting and collecting appropriate tariffs and fees. ADB's sector program within the Country Strategy and Program 2007 2010 is consistent with these policies and was confirmed by the 2008 Country Operations Business Plan and the Mid Term Review of the Country Strategy and Program in 2009. The strategy is explicitly designed to give substance to the Government's initiatives to decentralize planning, financing and decision making and to support the current legal framework in the water sector. The MFF will contribute to the Water Operational Framework , which emphasizes water availability and its value in the broadest possible context. As such, the MFF addressed the supply demand gap and improve efficiency in the water sector. It therefore also addresses resource protection, storage improvement, and the impact of technology, especially for NRW.

Impact Sustainable provision of safe water in Viet Nam
Project Outcome
Description of Outcome Efficiency of water supply companies improved.
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

1. Increased coverage

2. Improved business planning and asset and financial management

3. Effective NRW reduction

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Viet Nam
Safeguard Categories
Environment A
Involuntary Resettlement A
Indigenous Peoples B
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design The Ministry of Planning and Investment (MPI) will be the Coordinating Agency (CA) for the MFF with the following tasks: (i) selection of future water companies accessing the MFF and submission to ADB of the list at the Country Programming Mission (CPM); and (ii) consolidated reporting with the assistance of the water companies selected under each of the tranches. ADB will provide assistance to assist the CA in reporting, monitoring and dissemination.
During Project Implementation Refer to indivual tranches
Business Opportunities
Consulting Services tbd
Procurement tbd
Responsible ADB Officer Hubert M. Jenny
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Urban Development and Water Division, SERD
Timetable
Concept Clearance 23 Sep 2010
Fact Finding 06 Sep 2010 to 14 Sep 2010
MRM 01 Oct 2010
Approval 22 Feb 2011
Last Review Mission -
PDS Creation Date 18 May 2010
Last PDS Update 24 Sep 2014

MFF Facility Concept 0054-VIE

Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 1,000.00 Cumulative Contract Awards
ADB 1,000.00 - 0.00 0.00 %
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 - 0.00 0.00 %
Title Document Type Document Date
Water Sector Investment Program Facility Administration Manual Jan 2011
Water Sector Investment Program (Project 1) Gender Action Plans Jan 2011
Water Sector Investment Program Reports and Recommendations of the President Jan 2011
Framework Financing Agreement for Water Sector Investment Program between the Socialist Republic of Viet Nam and Asian Development Bank Framework Financing Agreement Dec 2010

Safeguard Documents

See also: Safeguards
Title Document Type Document Date
Water Sector Investment Program - Project 1 Resettlement Plans Oct 2010
Water Sector Investment Program: Environmental Assessment and Review Framework (as of Board approval) Environmental Assessment and Review Framework Oct 2010
Water Sector Investment Program Environmental Assessment and Review Framework Oct 2010
Water Sector Investment Program: Indigenous Peoples Planning Framework (as of Board approval) Indigenous Peoples Planning Frameworks/Indigenous Peoples Development Frameworks Oct 2010
Water Sector Investment Program Indigenous Peoples Planning Frameworks/Indigenous Peoples Development Frameworks Oct 2010
Water Sector Investment Program: Resettlement Framework (as of Board approval) Resettlement Frameworks Sep 2010
Water Sector Investment Program - Project 1 Resettlement Frameworks Oct 2009

Evaluation Documents

See also: Independent Evaluation

No documents found.


The Public Communications Policy (PCP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.