Vietnamese Minister for Planning and Investment Vo Hong Phuc (R), World Bank Vice President James W. Adams and Country Director of Asian Development Bank in Vietnam Ayumi Konishi (L) at Friday’s Consultative Group meeting in Hanoi

International donors committed Official Development Assistance (ODA) totaling around US$5 billion to Vietnam at a World Bank Consultative Group meeting that wrapped up in Hanoi Friday.

Multilateral donors pledged the largest amount. The World Bank promised $1.66 billion, followed by the Manila-based Asian Development Bank with $1.56 billion.

In bilateral aid, the European Union pledged $893 million, with more than half coming from France and Germany. South Korea committed US$268 million and the US$128 million.

Aid donors to Vietnam meet every December for the Consultative Group conference to pledge aid money for the year ahead. The money is only disbursed after a project obtains all necessary government approvals.

World Bank Vice President James W. Adams said next year would present new and difficult challenges for Vietnam.

“But the meeting clearly concluded that the [Vietnamese] government will be sustaining its efforts at economic and social reforms and that as a result, Vietnam can count on the donor community for continued support,” he said in his closing remarks.

Vietnamese Minister of Planning and Investment Vo Hong Phuc thanked participants for the frank and constructive dialogue.

“The Vietnamese government has mapped out various solutions to address the current economic crisis, to stabilize the economy and maintain its growth potential, as well as helping poor people overcome the difficulties brought about by the new economic challenges,” he said.

Continue anticorruption fight, donors urge

The total ODA committed to Vietnam next year could have topped $6 billion but for the Japanese suspension of soft loans, Minister Phuc said at a press briefing after the meeting.

Japan on Thursday said it was suspending relevant procedures for transport and sewerage projects in Vietnam that were to be funded with aid loans, which account for nearly 90 percent of Japan’s development aid to Vietnam.

The suspension of Japanese ODA loans to Vietnam follows claims made in a Tokyo court that a senior Ho Chi Minh City transport official took bribes from a Japanese company.

Ho Chi Minh City authorities last month suspended Huynh Ngoc Si, deputy head of the HCMC Department of Transport and chief of the Japan-funded East-West Highway and HCMC Water Environment Projects.

Si was suspended pending further investigation into allegations he took more than US$820,000 in bribes from Japanese Pacific Consultants International (PCI) executives. He allegedly received the bribes in exchange for helping PCI win consulting contracts on the highway project.

Earlier this year, the Japanese government announced its intention to extend ODA loans to Vietnam to JPY65.3 billion ($709 million) for the first half of fiscal 2008 for infrastructure, transport and sewerage improvement projects.

Mitsuo Sakaba, Japan’s Ambassador to Vietnam said on Thursday Japanese-funded technical assistance projects and grant aid to Vietnam would continue.

Phuc said the suspension of soft loans led to the halt of five major Japan-funded projects in Hanoi, Hai Phong, and HCMC.

However, Japan was still in interested in major projects in Vietnam, such as the North-South Highway, the Express Railway and the Hoa Lac Hi-Tech Park, Phuc said.

The Vietnamese and Japanese governments have set up a joint committee to investigate the East-West Highway bribery allegations.

“The government is also committed to stepping up the fight against corruption, in order to ensure that government and donors have a maximum impact on development efforts,” Minister Phuc said Friday.

“It is encouraging to see the leaders of the Vietnamese government repeatedly express their strong determination to combat corruption, and Japan would like to urge the Vietnamese government to make continuous efforts to prevent the recurrence of corruption,” Japan’s Ambassador Sakaba said.

Swedish Ambassador to Vietnam Rolf Bergman said, “The government of Vietnam and development partners agreed that the fight against corruption should be based on zero-tolerance. Further actions must now be taken to reach this goal.”

Donors and the Vietnamese government agreed a continued dialogue was needed on the role of the media in fighting corruption. Foreign donors also hailed Vietnam’s recent decision to ratify the United Nations convention on corruption.

Not gloss over the poor

Foreign donors asked the Vietnamese government to pay special attention to poor and vulnerable people in the current uncertain global economic climate.

Ayumi Konishi, the Country Director of the Asian Development Bank in Vietnam, said, “We are particularly concerned about the possible adverse impacts on the poor, small and medium enterprises and vulnerable people.”

“Together with other development partners, we would like to provide strong support to the government in responding to the emerging situation,” Konishi said. “We will stand ready to do whatever we can to help Vietnam maintain critical development expenditures.”

The Head of the UK’s Department for International Development in Vietnam, Fiona Lappin, called on participants to continue the fight against entrenched poverty in ethnic minority groups, the new urban poor and landless farmers.

“Development partners commend the government’s commitment to keep poverty reduction at the heart of its socio-economic policy, and it is particularly important in times of global economic turmoil to protect social sector spending under the 2009 state budget,” Lappin said.

Source: TN, Agencies