The Asian Development Bank (ADB) and Government of Vietnam have signed two loan agreements totaling nearly US$234 million to support reforms to strengthen the country’s competiveness and help deliver a sustainable urban transport system in Hanoi.
“Strengthened competitiveness will be critical for Vietnam to derive maximum benefits from a global recovery and the country’s continuing economic integration into the world economy,” said Mr. Kimura. “ADB welcomes and fully supports the government's strong commitment to the ongoing economic restructuring and reform agenda which will allow the country to continue to successfully transform itself into a dynamic, competitive, and efficient market economy.”
The signed agreements include a US$230 million policy loan for the Improving Competitiveness Program, which will support the Economic Management Competitive Credit Program—a joint development partner budget support program aligned to the national reform priorities of the government.
The program will support government reforms in six policy areas, including the financial sector; fiscal policy; public sector administration and accountability; state enterprise management; public investment management; and the business environment.
The second agreement is for a US$4.2 million loan for the Strengthening Sustainable Urban Transport for Hanoi Metro Line 3 Project, which has a total investment of US$58.95 million. The project will support the effectiveness and sustainability of another ADB-financed project, the Hanoi Metro Rail System Project (Line 3: Nhon-Hanoi Station Section), by improving access to stations, and enhancing connectivity between the line and other modes of public and private transport. The project will also strengthen urban transport policies and regulations.
At an early stage of urban transport development, Hanoi often faces severe congestion during peak hours caused by heavy usage of motorcycles and increased numbers of cars. The project will support the Hanoi urban transport master plan’s objectives of increasing the use of public transport, reducing dependency on private vehicles, as well as promoting inclusive low-carbon transport and reducing greenhouse gas emissions and environmental pollution.
Along with ADB’s $4.2 million loan, the Clean Technology Fund will provide a US$49 million loan, administered by ADB, to support sustainable transport benefits of the metro line 3 investment.