Viet Nam: Skills Enhancement Project

Sovereign Project | 41339-013 Status: Active


ADB is helping Viet Nam improve vocational training to address a worsening shortage of skilled workers in priority industries. The project will offer quality training programs in automotive technology, electrical manufacturing, hospitality and tourism, information and communication technology, mechanical manufacturing, and navigation and shipping in 15 public and 5 private vocational colleges.

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Procurement Notices See also: Operational Procurement

Procurement Documents

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Project Name Skills Enhancement Project
Project Number 41339-013
Country Viet Nam
Project Status Active
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 2652-VIE: Skills Enhancement Project
Concessional ordinary capital resources / Asian Development Fund US$ 50.00 million
Loan 2653-VIE: Skills Enhancement Project
Concessional ordinary capital resources / Asian Development Fund US$ 20.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Education - Technical and vocational education and training

Gender Equity and Mainstreaming Gender equity

The Project will produce a more competitive and highly skilled workforce in priority industries by developing higher level training programs at a new college level, while also establishing and strengthening system governance and quality assurance frameworks for vocational training. Studies will also strengthen the policy foundation for future development.

The project will improve the quality and management of vocational education and training (VET) programs in 15 public and 5 private vocational colleges (VCs) in economic zones

offering programs for occupations in high demand in priority industries. The programs cover automotive technology, electrical manufacturing, hospitality and tourism, information and

communication technology (ICT), mechanical manufacturing, and navigation and shipping. The project will consist of two loans, the first to strengthen the public vocational training system and VCs, and the second to provide private VCs with additional resources through an onlending facility. The direct beneficiaries of the project will be students in certificate and diploma vocational training courses, most of whom come from the rural lower middle class.

Project Rationale and Linkage to Country/Regional Strategy

The VET system is being transformed by a new focus on higher level skills, through the recent establishment of a college level. There are currently 90 public VCs and 20 private VCs.

In response to the demand for a more highly skilled workforce, the government has developed an excellent set of policies to strengthen the VET system, through the new Law on Vocational Training, 2006, effective in 2008. The major provisions of this law are (i) expansion of a more advanced level of training; (ii) improved VET quality and relevance; (iii) greater involvement of a range of partners, particularly from the private sector; and (iv) strengthened VET sector management under one central agency, the Ministry of Labor, Invalids and Social Affairs (MOLISA). Most of the groundwork for this law was laid under the Asian Development Bank (ADB)-supported Vocational and Technical Education Project (VTEP). Implementation of the major provisions of the law forms the foundation of the proposed project.

Many VET graduates lack appropriate technical and general work skills. The immediate causes are poor training quality and management capacity, weak sector management, and

limited private sector collaboration and partnerships. This is underpinned by inadequate financing of the VET sector and vocational training institutions. In addition, the VET system is

largely supply-driven, reinforced by input-focused financing and the absence of skills standards that link specific competencies to labor market needs. Limited collaboration with industry has reinforced this tendency. However, this is now changing and there is a strong desire within the government to build a better training system that is more relevant to industry.

The VTEP initiated significant reform in VET quality assurance systems, and modernized vocational training curricula in line with new production techniques and technologies, while

substantially upgrading vocational secondary schools. Other donor initiatives include system reforms and strengthening of vocational training institutions by Agence Fran aise de

D veloppement, the European Union, German development cooperation through GTZ and KfW, the Government of the Republic of Korea, and the Government of Luxembourg. These projects have all been successful in strengthening the lower levels of the vocational training system and have expanded training opportunities for primary school and junior secondary school leavers.

The VTEP illustrated the value of experimenting with new approaches within a circumscribed context before system-wide implementation. It focused upon improving the

technical skills of students and teachers, but weak management at the school and central levels undermined these efforts.4 Similarly, the absence of a training system to periodically update teachers' skills in response to new technologies and changing job markets hampered efforts to improve teacher quality. The proposed project will address both of these weaknesses.

Impact Reduction in skills shortages in 15 key occupations.

Project Outcome

Description of Outcome Higher-level skills training in 15 key occupations established for males and females.
Progress Toward Outcome All planned outcomes are not yet due, but it is likely that targets could be achieved by August 2017. The GDVT is working toward the completion of a national strategy for vocational training up to 2020. The Project Performance Monitoring System [PPMS] has made provisions to measure the targeted 30% increase over baseline in enrollment and graduates, and initial findings will be included in the annual report for 2016. Measurement of the targeted 85% of graduates having gained employment within 6 months from completion of their studies is planned by the VCs through a tracer study in 2017. The tracer study is crucial not only for purposes of determining whether the target is achieved or not, but for determining if there has been any improvement after the first tracer study when 77.8% of graduates reported having gained employment up to 3 months from graduation.
Implementation Progress
Description of Project Outputs

1. Quality and management of vocational training improved.

2. VCs upgraded to deliver priority occupational training programs.

3. Partnerships with the private sector strengthened.

Status of Implementation Progress (Outputs, Activities, and Issues)

Output 1:

Three study tours [Taiwan, 15-19 July 2014; Australia, 21-25 July 2014; Malaysia 7-13 September 2014] attended by 38 participants, 21.1% female.

Detailed implementation plan for management training and budget estimates are being prepared.

The development of the VTIS is cancelled. The consultant completed the system design specifications in November 2011. In 2012, GDVT received financial support from MOLISA to complete an on-going development of a software. Thus, PMU proposed the cancellation of this activity in This was approved by ADB in its letter dated 20 Sep 2013. The Loan Review Mission, 1-4 Dec 2014, also noted the cancellation.

Accreditation system: Prior to 1 July 2015, the regulation of vocational colleges and academic colleges were under separate laws. Starting 1 July 2015, both vocational and academic colleges are governed by the VET Law, but GoV has yet to decide which ministry [MOLISA or Ministry of Education] will be in charge of VET. A joint circular on program accreditation between MOLISA and MOET is envisaged, but this could delay program accreditation activities. Rather than wait for the joint circular, it was agreed during the Loan Review Mission, 7-14 March 2016, that PMU will cooperate with GDVT's Agency of Vocational Training Accreditation.

Status of accreditation of programs: GDVT has submitted to MOLISA to implement the accreditation of 20 programs and apply the cost norm regulated in Curricular 102/2013/TTLT-BTC-BL TBXH.

National skills standards for 15 occupational programs had been issued as follows: Decision No. 1305 issued by MOT, 21 Jun 2011, for automotive technology, exploitation of marine machinery and ship control; Decision No. 4837 issued by MoIT, 22 Sep 2011, for computer network administration, computer programming, database administration, industrial electronics, electrical installation techniques and industrial control, industrial electricity, mechatronics, operation repair of refrigeration equipment and welding; Circular No. 01/2014/TT issued by the Ministry of Culture, Sports and Tourism, 15 Jan 2014, for food processing and hotel management [culinary]; Decision No. 3316 issued by MIT, 14 June 2012, for metal cutting.

Professional standards for teachers and principals: Aprroved. Circular No. 30/2010/TT-BLDTBXH on standards for vocational teachers issued on 9 September 2010.

Pre-service training activities has been cancelled according to the MOU of ADB Mission on Jan 2014. Gender-responsive training will be included in the teacher training activities (DT04 and DT05)

Study on teacher incentives and new cost norms completed [package TV09]. PMU has transferred the outputs of Study on teacher incentives and cost norm for the related department under GDVT. Currently, GDVT issued the guidance circular to develop and set up the cost norm for technical in vocational training.

Output 2:

Six international Industry Specialists and an equal number of National Specialist

counterparts were fielded to develop the equipment procurement list and sample

learning materials and course outlines for 15 occupations based on 15 skills

standards issued. First 10 training programs piloted in 2012 and another 4

in 2013. Further accreditation in progress.

VCs offering = or > 3 occupational programs (OPs): 12

VCs offering 2 OPs: 4

VCs offering 1 OP: 0

ERUs operational in SEP VCs with marketing plans developed by 2012 (with

equal gender representation) - no data yet

Skills testing centers operational in public and private VCs - no data yet

Total workers/teachers tested since Jan 2013:0

Female workers/teachers tested since Jan 2013: 0

Total graduates tested since Jan 2013: 78

Female graduates tested since Jan 2013: 0

Implementation of management training package - see output 1

Institutional business plans developed: 6

Total number of teachers issued competency certificates in SEP VCs since 2013: 454

Female teachers issued competency certificates in SEP VCs since 2013: 189

Total number of teachers issued competency certificates in other VCs since 2013: 83

Female teachers issued competency certificates in other VCs since 2013: 18

Number of VCs with Level 1 accreditation by GDVT=0

Number of VCs with Level 2 accreditation by GDVT=1

Number of VCs with Level 3 accreditation by GDVT=15

Number of VCs without any GDVT accreditation=0

Pilot initiatives to increase female enrollment in nontraditional areas - not yet completed

Output 3

Loan B (Credit Facility)

Only 3 subloans approved at closing (29 February 2016):

1. Bac Nam VC: subloan includes construction of multi-function workshop, supply of vocational equipment and supply and installation of equipment for fire protection and firefighting. Post-review of Bac Nam VC bidding documents for the construction of multifunctional building has been approved in July 2014. Bidding documents for supply of vocational equipment submitted for post review. VC has fully utilized the subloan.

2. An Nhat Vinh VC: subloan includes construction, expansion and improvement (including supply and installation of equipment/furniture). Post-review of An Nhat Vinh VC NCB documents for its construction, expansion, and improvement has been approved in June 2014. Civil works component completed but large packages of equipment not procured due to change in equipment list.

3. Dong An VC: subloan includes construction and purchase of equipment. Civil works completed but procurement of equipment not completed.

Geographical Location

Safeguard Categories

Environment C
Involuntary Resettlement C
Indigenous Peoples B

Summary of Environmental and Social Aspects

Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design A stakeholder and problem analysis was conducted to identify key project stakeholders including those agencies and organizations promoting women and ethnic minorities. Consultations were held with stakeholders including officials from Ministry of Labor, Invalids and Social Affairs (MOLISA), Ministry of Education and Training (MOET), Ministry of Finance (MOF), State Bank of Viet Nam (SBV), Ministry of Planning and Investment (MPI), vocational college managers, teachers and students. Additional consultations were held with the Department of Gender Equality in MOLISA and other departments concerned.
During Project Implementation Being monitored during project implementation

Business Opportunities

Consulting Services

All consultants will be recruited according to Guidelines on the Use of Consultants by ADB and its Borrowers (2007, as amended from time to time). The terms of reference for all consulting services are detailed in Section D.

All consultants to be financed from the loan proceeds will be selected in accordance with ADB's Guidelines on the Use of Consultants (2007, as amended from time to time). Individual national consultants will be engaged to provide preparatory training and support and guide start-up activities. A consulting firm will be engaged through QCBS (80:20) using a full technical proposal to provide qualified consultants to provide technical support for implementation, quality assurance, monitoring and evaluation, and teacher upgrading. The Project will provide 116 person months of international consultant inputs, and 174 person-months of national consultant inputs. MOLISA, through GDVT, will be responsible for selecting and hiring consultants. All consultants will be selected in accordance with ADB's Guidelines on the Use of Consultants (2007, as amended from time to time). The Project will also recruit institutions or firms to carry out the baseline, midterm and final impact studies; the social marketing campaign; and various training programs and studies using the consultant's qualification selection method for contracts under $200,000. An individual international consultant will be engaged for 9 months to support the development and piloting of a vocational training information system. Individual national consultants from VET institutions, industry and elsewhere may also be engaged to assist the PMU and the PIUs as needed. All consulting assignments will be advertised by the EA on the Consulting Services Recruitment Notice ( The online collection of Expressions of Interest (EOIs) is preferred to assure comparability of the EOIs and transparency of the selection process.


All procurement of goods and works will be undertaken in accordance with ADB's Procurement Guidelines (2007, as amended from time to time).

1. Supply contracts for goods under the investment loan such as workshop equipment estimated at $500,000 equivalent or more will be awarded on the basis of international competitive bidding. Supply contracts for goods such as vehicles, computers and office equipment of more than $100,000 but less than $500,000 will follow national competitive bidding procedures. Items costing $100,000 or less will be procured through shopping.

2. Civil works will consist of classroom or workshop rehabilitation and possible extensions. Civil works under the investment loan will be implemented at school level, with contract values less than $350,000. As all civil works is financed by the Government, procurement will follow the Law on Procurement of Vietnam.

3. The private VCs will procure their own works and goods. Procurement undertaken by the VCs will be in accordance with established private sector or commercial practices (ADB Procurement Guidelines, para 3.12). ICB may be the most appropriate procurement method for the purchase of large single items or in cases where large quantities of similar goods can be grouped together for bulk purchasing. Each private VC will establish a project implementation unit (PIU) and procurement evaluation committees. The PIU will be responsible for the procurement of goods and civil works. Taxes will be paid by the training institutions and managing authorities.

4. Before the start of any procurement ADB and the Government will review the public procurement laws of the central and state governments to ensure consistency with ADB's Procurement Guidelines.

Responsible Staff

Responsible ADB Officer Izawa, Eiko
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Human and Social Development Division, SERD
Executing Agencies
Ministry of Labor, Invalids and Social Affairs
Do Nang Khanh


Concept Clearance 16 Nov 2009
Fact Finding 09 Nov 2009 to 24 Nov 2009
MRM 08 Dec 2009
Approval 15 Jul 2010
Last Review Mission -
PDS Creation Date 03 Apr 2008
Last PDS Update 28 Sep 2016

Loan 2652-VIE

Approval Signing Date Effectivity Date Closing
Original Revised Actual
15 Jul 2010 05 Oct 2010 14 Feb 2011 29 Feb 2016 31 Aug 2017 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 58.00 Cumulative Contract Awards
ADB 50.00 15 Jul 2010 37.38 0.00 78%
Counterpart 8.00 Cumulative Disbursements
Cofinancing 0.00 15 Jul 2010 30.19 0.00 63%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - - - - - Satisfactory

Loan 2653-VIE

Approval Signing Date Effectivity Date Closing
Original Revised Actual
15 Jul 2010 05 Oct 2010 14 Feb 2011 29 Feb 2016 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 20.00 Cumulative Contract Awards
ADB 20.00 15 Jul 2010 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 15 Jul 2010 6.45 0.00 66%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - - - - - Satisfactory
Title Document Type Document Date
Skills Enhancement Project: Procurement Plan Procurement Plans Jan 2017
Skills Enhancement Project Project/Program Administration Manual May 2012
Project Agreement for Skills Enhancement Project between Asian Development Bank and Viet Nam Development Bank dated 5 October 2010 Project/Program Agreement Oct 2010
Loan Agreement for Skills Enhancement Project between Socialist Republic of Viet Nam and Asian Development Bank dated 5 October 2010 Loan Agreement (Special Operations) Oct 2010
Skills Enhancement Project Consultants' Reports Jun 2010
Skills Enhancement Project Project/Program Administration Manual Jun 2010
Skills Enhancement Project Reports and Recommendations of the President Jun 2010
Skills Enhancement Project Summary Poverty Reduction and Social Strategies Jun 2010
Privatization of DPWH Equipment and Workshops TA Completion Reports Jul 2003

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.

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