The World Bank greenlit over US$502 million to develop Viet Nam’s urban infrastructure, rural electricity network expansion and access to capital in rural areas yesterday.

"This reflects the World Bank’s continuous and enhanced commitment to assisting Viet Nam to address the challenges in its development path," said Ajay Chhibber, the World Bank country director for Viet Nam.

"These are the sectors that Viet Nam will need to pay attention to if it wants to ensure continued and equitable growth. Therefore, I believe that the financial and technical assistance under these projects will bring real changes to the lives of poor people, both in urban and rural areas," he said.

The bank’s International Development Association (IDA) will fund three projects: the Da Nang Priority Infrastructure Investment Project, Rural Distribution Project and Viet Nam Third Rural Finance Project.

The Da Nang Priority Infrastructure Investment Project is designed to improve the efficiency and sustainability of urban services in Da Nang through a package of priority investments including urban upgrading, environmental infrastructure improvement and strategic road access construction in selected areas, as well as measures for institutional strengthening in investment planning and in the management of urban services.

The project consists of two phases. Its total cost is $218.46 million, of which IDA will provide $152.44 million.

The Viet Nam Rural Distribution Project will boost the level of medium voltage service to targeted retail electricity distribution systems by upgrading and increasing the capacity of existing distribution lines and sub-stations and standardising them to 22, 35 and 110kV.

The total cost for this project is $206.28 million, of which IDA will contribute $150 million and the Australian Agency for International Development (AusAID) will provide $3 million.

The Viet Nam Third Rural Finance Project will increase economic benefits to rural private enterprises and households by easing access to financial resources. This will involve a microcredit programme for rural populations, the introduction of new technologies, and a renovation of credit and financial institutions to provide improved services and new products for rural areas.

IDA will provide $200 million out of the total $230 million cost of this project.

                                                                                                          Source: VNS