Asian Development Bank &

Viet Nam
FACT SHEET
Table 1. Viet Nam: 2011 Loan, Technical Assistance, and Grant Approvals ($ million)
Loans Technical Sovereign Nonsovereign Assistance Grants Total 1,396.19 8.60 1,404.79
= nil.

Partnerships
The Asian Development Bank (ADB) has been working in partnership with the Government of Viet Nama founding member of ADB in 1966since 1993. As part of its regular operations, ADB maintains close coordination with Viet Nams development partners to improve the effectiveness, efficiency, and impact of its lending and nonlending programs. ADB also works closely with civil society organizations and the private sector in Viet Nam to mobilize financial resources and expertise from other partners. ADB is cofinancing the poverty reduction support credit and related policy reforms, led by the World Bank and supported by a number of partners. In preparing its country partnership strategy (CPS), 20122015, ADB coordinated with development partners to align strategies with Viet Nams Socio-Economic Development Plan (SEDP), 20112015. ADB is an active member of the Aid Effectiveness Forum and the Six Banks Initiative of international financial institutionsADB, Agence Franaise de Dveloppement, Kreditanstalt fr Wiederaufbau, Japan International Cooperation Agency, ExportImport Bank of Korea, and the World Bank.

Table 2. Viet Nam: Cumulative ADB Lending by Sector as of 31 December 2011a

Sector Loans (no.) 29 14 13 10 8 5 11 23 Amount ($ million) 1,481.66 650.50 2,464.38 502.00 268.20 128.50 971.20 3,216.90 %b 13.87 6.09 23.07 4.70 2.51 1.20 9.09 30.12

Agriculture and Natural Resources Education Energy Finance Health and Social Protection Industry and Trade Public Sector Management Transport and ICT Water Supply and Other Municipal Infrastructure and Services Multisector Total Total Disbursements

Operational Challenges
Project implementation delaysa persistent problem in Viet Nams portfolioare attributable to several factors such as delays in recruitment of consultants, issues related to land acquisition and resettlement, weak capacity of project management units, and problems in procurement and contract management. To improve the situation, ADB and the government work together to review and harmonize loan and technical assistance grant processing procedures to ensure that proper consultation and decision making will be coordinated to speed up approvals. Guidelines for financial management and procedures have been prepared to serve as a reference for project implementation. Concerted efforts are being made through the Six Banks Initiative to improve the overall performance of the official development assistance. Overall portfolio performance is improving, but, given the rapid expansion of ADB and other banks portfolios, the amount of undisbursed funds is also on the rise.

13 7 133

717.82 280.00 10,681.16

6.72 2.62 100.00

$4,951.4 million

ICT = information and communication technology.

a b

Includes sovereign and nonsovereign loans. Total may not add up because of rounding.

Table 3. Viet Nam: Cumulative Nonsovereign Financing by Product

Number of Projects Loans Equity Investments Guarantees B Loans Total
= nil.

7 Amount ($ million) 193.50 60.00 26.50 280.00

As of 31 December 2011

Future Directions
With Viet Nams progression to a middle-income economy, the new SEDP 20112015, was approved in 2011. ADB is also , preparing the new CPS, 20122015. Efforts are being made to enable ADB to support the country to achieve inclusive, sustainable, and stable socioeconomic development, and to realize Viet Nams long-term vision of becoming a modern industrialized nation by 2020. Recognizing that the immediate policy priority of the government is to restore macroeconomic stability, ADB is actively involved in policy dialogue on macroeconomic management, while supporting the governments commitment to comprehensive economic restructuring and continued reform, as well as efforts to improve corporate governance and efficiencies of state-owned enterprises. To facilitate faster development of infrastructure, ADB is assisting the government to develop a pilot scheme to promote publicprivate partnerships. Viet Nam needs to place greater emphasis on improving the efficiency of its economy for it to be an integral part of the regional and global value chain, and these considerations are to form the basis of the next CPS, 20122015, which will be fully aligned with the governments new SEDP as well as with ADBs long-term , strategic framework, Strategy 2020. Viet Nam is one of the largest concessionary Asian Development Fund (ADF) recipients, with projected ADF allocation of $736 million for 20112012. Ordinary capital resources are also actively being used for projects with higher rates of return, such as infrastructure, which has an allocation of $943 million in 2012.

Table 4. Viet Nam: Development Indicators

Non-MDG Population in millions Annual population growth rate (%) Adult literacy rate (%) Population in urban areas (%) MDG Population living on less than $1.25 (PPP) a day (%) Population living below the national poverty line (%) Under-5 mortality rate per 1,000 live births Population using an improved drinking water source (%)
MDG= Millennium Development Goal, PPP = purchasing power parity.
a

87.84 [2011] 1.0 [20092011] 92.8 [2009] 28.8 [2010] 16.9 [2008] 14.5a [2008] 23 [2010] 95 [2010]

General poverty rate based on general poverty line provided by the General Statistics Office and the World Bank.

Sources: ADB. 2012. Basic Statistics 2012. Manila; United Nations Educational, Scientific and Cultural Organization (UNESCO). 2012. Institute for Statistics Data Centre; World Bank. 2012. World Development Indicators Online.

Table 5. Viet Nam: Economic Indicators, 20072011

Economic Indicator Per capita GNI, Atlas method ($) GDP growth (% change per year) CPI (% change per year) Unemployment ratea (%) Fiscal balance (% of GDP) Export growth (% change per year) Import growth (% change per year) Current account balance (% of GDP) External debt (% of GNI) 2007 790 8.5 8.3 4.6 (4.6) 21.9 38.5 (10.0) 29.0 2008 2009 2010 920 1,030 1,160 6.3 5.3 6.8 23.0 6.9 9.2 4.7 4.6 4.3 (3.1) (9.3) (6.6) 29.1 (8.9) 26.4 27.9 (14.3) 19.5 (11.9) (6.8) (4.0) 27.8 31.5 32.2 2011 ... 5.9 18.7 ... (4.0) 34.2 25.9 0.2 ...

( ) = negative, ... = data not available, CPI = consumer price index, GDP = gross domestic product, GNI = gross national income.
a

Refers to urban population only.

Sources: ADB. 2012. Asian Development Outlook 2012. Manila; ADB staff estimates; World Bank. 2012. World Development Indicators Online.

Table 6. Viet Nam: Project Success Rates

Sector Agriculture and Natural Resources Education Energy Finance Health and Social Protection Industry and Trade Public Sector Management Transport and ICT Water Supply and Other Municipal Infrastructure and Services Multisector Total Year of Approval 1970s 1990s 2000s
= nil, ICT = information and communication technology.
a

Context
ADB has provided Viet Nam with 133 sovereign and nonsovereign loans totaling $10.68 billion, 311 technical assistance grant projects amounting to $242.3 million, and 26 other grants totaling $150.1 million. ADB has also approved eight nonsovereign loans, two political risk guarantees, and one B loan totaling $280 million. Over the last 20 years, Viet Nam has been one of the fastest-growing economies in Asia, with gross domestic product growth averaging 7.2% during 20002010. It recently became a middle-income country. A long period of rapid economic growth, combined with various policies targeting the poor, has enabled Viet Nam to reduce poverty dramatically. Still, the country faces many development challenges, including recent macroeconomic instability.

%a 63.64 100.00 66.67 100.00 100.00 100.00 100.00 100.00 66.67 100.00 84.44 9.20 100.00

No. of Rated Projects/ Programs 11 3 3 4 1 2 4 8 6 3 45 5 25 15

Based on aggregate results of project/program completion reports (PCRs), PCR validation reports (PCRVRs), and project/program performance evaluation reports (PPERs) using PCRVR or PPER ratings in all cases where PCR and PCRVR/PPER ratings are available.

Sources: PCRs, PCRVRs, and PPERs containing a rating circulated as of 31 December 2011.

ADB-Supported Projects and Programs

When operations resumed in 1993, ADB focused on rehabilitation and support to economic reforms. From 2002, ADB supported the governments targeted efforts to reduce poverty, focusing on sustainable growth, inclusive social development, good governance, and, geographically, on the central region. ADBs CSP 20072010, was fully aligned with the governments , SEDP 20062010, and supported pro-poor, business, led growth, as well as social inclusiveness, environmental

Table 7. Viet Nam: Portfolio Performance Quality Indicators for Sovereign Lending, 20102011
Number of Ongoing Loans (as of 31 Dec 2011) Contract Awards/Commitmentsa,b Disbursementsa Number of Ongoing Grants (as of 31 Dec 2011)c Contract Awards/Commitmentsa,b Disbursementsa Project at Risk (%)
Note: Totals may not add up because of rounding.
a b c

2010 ($ million) 605.6 406.7 2010 ($ million) 6.7 6.8

60 2011 ($ million) 1,235.1 792.7 3 2011 ($ million) 2.0 4.8 11.1

Includes closed loans that had contract awards or disbursements during the year. Excludes policy-based lending/grants. Includes only ADF and other ADB Special Funds.

sustainability, good governance, and regional cooperation. Given that a major constraint to pro-poor, business-led growth was inadequate infrastructure, the use of ordinary capital resources was mainstreamed during this period, and ADB became one of the largest development partners in Viet Nam. ADB has contributed to Viet Nams rapid economic growth and improved living standards by providing assistance for inclusive social development, sustainable and renewable natural resources, and management for protection of the environment. In particular, rehabilitation of Highway 1, both in the northern and southern part of the country, significantly supported development of Viet Nams industrial centers, while the Greater Mekong Subregion (GMS) EastWest Economic Corridor and the Ho Chi Minh CityPhnom Penh Highway have improved Viet Nams connectivity with other GMS economies. Improvement in transport networks has generated employment in the border provinces and significantly reduced poverty. ADB is also addressing inadequate power supplya critical constraint to continued economic growthwith investments in hydropower and thermal power generation and transmission networks. ADB assistance in rural development and irrigation has helped raise agricultural productivity and farmers incomes through improved access to markets and inputs, introduction of high-value crops, crop diversification, and improved water resources management practices.

Table 8. Viet Nam: Projects Cofinanced, 1 January 200731 December 2011

Cofinancing Projectsa Grants Official loans Commercial Cofinancing Technical Assistance Grants
a

No. of Projects 18 10 11 26

Amount ($ million) 3,523.94 51.28 2,218.22 1,254.44 56.57

A project with more than one source of cofinancing is counted once.

Table 9. Viet Nam: Share of Procurement Contracts

2010 Amount % of Item ($ million) Total Goods and Works 181.83 2.80 Consulting Services 20.39 4.91 2011 Amount % of ($ million) Total 398.69 5.59 13.34 3.14 Cumulative (as of 31 Dec 2011) Amount % of ($ million) Total 2,610.65 2.38 58.65 0.72

Table 10. Viet Nam: Contractors/Suppliers Involved in ADB Loan Projects, 1 January 200731 December 2011
Contractor/Supplier Vietnam Cons. & Import Export JS Corp. LS Vina Cable Co., Ltd. Military Commercial JSB Power Construction JSC No. 1 Power Construction Installation Co. Ltd. No. 4 Hang An, Hanoi Transport Const. Thang Long Phuong Thanh Transport Construction Dong Mekong & Truong Thinh Group JSC Infrastructure Development Const. Corp.-LICOGI Vietnam JSCB for Industry and Trade Sector Transport and ICT Energy Public Sector Management Energy Energy Transport and ICT Transport and ICT Transport and ICT Energy Public Sector Management Contract Amount ($ million) 82.63 39.28 30.08 29.98 25.83 24.97 19.41 17.88 15.15 15.05

Cofinancing
Cofinancing operations enable ADBs financing partners, government or their agencies, multilateral financing institutions, and commercial organizations, to participate in the financing of ADB projects. The additional funds are provided in the form of official loans and grants, and commercial cofinancing, such as B loans, risk transfer arrangements, parallel loans, and cofinancing for transactions under the ADBs Trade Finance Program. By the end of 2011, cumulative direct value-added official cofinancing for Viet Nam amounted to $2.47 billion for 36 investment projects and $90.1 million for 81 technical assistance projects. In 2011, Viet Nam received $1.48 billion loan cofinancing from the European Investment Bank, and the governments of France, Germany, and the Republic of Korea; and $2.8 million grant cofinancing from the Nordic Development Fund. A summary of projects with cofinancing from 1 January 2007 to 31 December 2011 is available at www.adb.org/ countries/viet-nam/cofinancing

ICT = information and communication technology.

Table 11. Viet Nam: Top Consultants (Individual Consultants and Consulting Firms) Involved in ADB Loan Projects, 1 January 200731 December 2011
Consultant CDM International, Inc. Vica Consultants International Ltd. Smec Intl. Pty. Ltd./Smec holding Ltd. Thang Long Infrastructure Development JSC Asian Management Development Institute Forest Inventory Planning Sub-Institute Institute of Irrigation Science, Southern VN Auditing and Accounting Financial Consultancy Thanh Hoa and Quang Binh WRS JSC Center for Environmental Research Individual consultants Number of Times Contracted 1 9 2 5 1 7 1 10 1 3 23 Contract Amount ($ million) 6.75 2.63 1.25 0.66 0.45 0.45 0.44 0.42 0.42 0.42 0.22

Nonsovereign Operations
As a catalyst for private investments, ADB provides direct financial assistance to nonsovereign public sector and private sector projects in the form of direct loans, equity investments, guarantees, B loans, and trade finance. Since its inception, ADB has approved a total of $280 million in nonsovereign financing, all of which were for seven private sector projects in Viet Nam.

Total outstanding balances and commitments of ADBs private sector transactions in the country as of 31 December 2011 totaled $262.6 million, representing 6.7% of ADBs total nonsovereign portfolio.

Table 12. Viet Nam: Top Consultants (Individual Consultants and Consulting Firms) Involved in ADB Technical Assistance Projects, 1 January 200731 December 2011
Consultant Vica Consultants International Ltd. Centre D Etude et de Cooperation Intl. (CECI) Ernst & Young (Ho Chi Minh) Ernst & Young Vietnam (Hanoi) Central Institute for Economic Mgmt. Towers Watson Vietnam Co. Ltd. Asia Injury Prevention Foundation Institute of Energy Science Australian Foundation for the Peoples of Asia Pacific Center for Development and Integration Individual consultants Number of Times Contracted 3 1 1 1 1 1 1 1 1 1 260 Contract Amount ($ million) 0.95 0.83 0.61 0.15 0.12 0.10 0.10 0.07 0.06 0.06 3.51

Procurement
From 1 January 1968 to 31 December 2011, contractors and suppliers were involved in 197,338 contracts for ADB loan projects worth $109.78 billion. During the same period, contractors and suppliers from Viet Nam were involved in 7,874 contracts for ADB loan projects worth $2,610.65 million. From 1 January 1968 to 31 December 2011, consultants were involved in 12,179 contracts for ADB loan projects worth $4.81 billion. During the same period, consultants from Viet Nam were involved in 571 contracts for ADB loan projects worth $42.76 million. From 1 January 1968 to 31 December 2011, consultants were involved in 24,484 contracts for ADB technical assistance projects worth $3.42 billion. During the same period, consultants from Viet Nam were involved in 583 contracts for ADB technical assistance projects worth $15.89 million.

About Viet Nam and ADB

ADB Membership Joined 1966 Shareholding and Voting Power Number of shares held: 36,228 (0.34% of total shares) Votes: 75,718 (0.57% of total membership, 0.88% of total regional membership) Overall capital subscription: $556.20 million Paid-in capital subscription: $36.09 million Yeo Kwon Yoon is the Executive Director and Wilson Leonard F. Kamit is the Alternate Executive Director representing Viet Nam on the ADB Board of Directors. Tomoyuki Kimura is the ADB Country Director for Viet Nam. The Viet Nam Resident Mission (VRM) was opened in 1997 and provides the primary operational link between ADB and the government, private sector, and civil society stakeholders in its activities. VRM engages in policy dialogue and acts as a knowledge base on development issues in Viet Nam. The Viet Nam government agency handling ADB affairs is the State Bank of Viet Nam. About the Asian Development Bank

Contacts
Viet Nam Resident Mission Units 701706, Sun Red River Building 23 Phan Chu Trinh Street Hoan Kiem District, Ha Noi, Viet Nam Tel +84 4 3 933 1374 Fax +84 4 3 933 1373 www.adb.org/vietnam ADB Headquarters 6 ADB Avenue, Mandaluyong City 1550 Metro Manila, Philippines Tel +63 2 632 4444 Fax +63 2 636 2444 State Bank of Viet Nam 4749 Ly Thai To Street Hoan Kiem District, Ha Noi, Viet Nam Tel +84 4 3 936 3871/3 934 3364 Fax +84 4 3 934 9569/3 825 0612 www.sbv.gov.vn Useful ADB websites Asian Development Bank www.adb.org Asian Development Outlook www.adb.org/publications/series/asiandevelopment-outlook Annual Report www.adb.org/documents/series/adb-annual-reports Depository Libraries www.adb.org/publications/depositories/vie

ADB is a multilateral development bank owned by 67 members, 48 from the region and 19 from other parts of the world. ADBs main instruments for helping its developing member countries are policy dialogue, loans, equity investments, guarantees, grants, and technical assistance (TA). In 2011, lending volume was $12.61 billion (104 projects), with TA at $148 million (212 projects) and grant-financed projects at $614 million (23 projects). In addition, $7.7 billion was generated in direct value-added cofinancing in the form of official loans and grants and commercial cofinancing such as B loans, risk transfer arrangements, parallel loans, and cofinancing for transactions under ADBs Trade Finance Program. From 1 January 2007 to 31 December 2011, ADBs annual lending volume averaged $11.34 billion. In addition, TA and investment grants funded by ADB and special funds resources averaged $755.3 million and $175.0 million in TA over the same period. As of 31 December 2011, the cumulative totals excluding cofinancing were $179.7 billion in loans for 2,423 projects in 42 countries, $5.0 billion in 186 grants, and $3.3 billion in TA grants, including regional TA grants.
In this publication, $ refers to US dollars. Figures are estimated by ADB unless otherwise cited. Data are as of 31 December 2011 unless otherwise indicated. Fact sheets are updated annually in April.

April 2012