ADB supports economic development in northeastern and north central areas
The Asian Development Bank’s (ADB) Board of Directors has approved a USD150 million loan to help improve economic connectivity and raise living standards in four of Vietnam’s northeastern provinces by enhancing basic infrastructure and services.
Speaking about the loan, ADB’s Country Director for Vietnam, Eric Sidgwick, said that Vietnam has been experiencing remarkable growth over the last few years but the majority of economic gains have accrued in the urban areas, with rural areas, including provinces in the northeast, lagging behind.
“We are confident the project will help realize the great growth and development potential of the northeastern part of Vietnam, particularly in trade, agriculture, and tourism,” he said
The provinces of Bac Kan, Cao Bang, Ha Giang, and Lang Son—the project area—have significant potentials to be trade hubs due to their strategic location, at the nexus of the People’s Republic of China, the capital Hanoi, the Hai Phong port, and the ADB-supported Greater Mekong Subregion North-South Economic Corridor. However, these potentials are yet to be fully realized, with gross domestic product per capita of the four provinces in 2015 remaining at USD1,160, almost half of the USD2,036 national average.
The project will improve road connectivity among the provinces by upgrading about 121 kilometers (km) of provincial and 144 km of district roads, provide rural water supply, benefiting 42,300 people, and improve agriculture value chain infrastructure in Lang Son province through farm-to-market connectivity and support to local businesses. It will also strengthen the capacity of the provincial governments, particularly on public asset management.
Total cost of the project is USD190.3 million, with the Government of Vietnam contributing USD40.3 million. The project is expected to be completed by the first quarter of 2023.
Besides loans for the northeastern provinces, ADB has also approved loans totaling USD149 million to help improve basic infrastructure services and promote inclusive and sustainable economic growth that will benefit over 1 million people in four provinces in the north central coastal region.
ADB’s assistance for the Basic Infrastructure for Inclusive Growth in the North Central Provinces Sector Project includes a regular loan of USD52 million and a concessional loan worth USD97 million. Both loans will be financed from the ordinary capital resources where most of ADB’s lending come from. The total cost of the project, is USD203.52 million, with the Government of Vietnam contributing USD54.52 million.
Economic development in the project provinces—Ha Tinh, Nghe An, Quang Binh, and Quang Tri—has been constrained by the fragmented coverage of basic infrastructure, with the 2015 poverty rate reaching 13% compared to the 7% national average. Moreover, the provinces are extremely vulnerability to weather-related disasters and are predicted to have the country’s highest increase in annual mean temperature at 1.7% and annual rainfall shooting up by 20%.
To address these issues, the project will improve connectivity among the provinces by upgrading and constructing about 214 kilometers of climate-resilient provincial and district roads, which will benefit more than 900,000 beneficiaries. It will boost business development through the construction and upgrading of rural water supply, flood protection, irrigation, and port services. It will also improve the capacity of the provincial governments, particularly in public asset management. The project is expected to be completed by the first quarter of 2023.
A tree and a power pole fell in a storm in Ha Tinh Province in September 2017
Speaking about the loan, ADB’s Country Director for Vietnam, Eric Sidgwick, said that Vietnam has been experiencing remarkable growth over the last few years but the majority of economic gains have accrued in the urban areas, with rural areas, including provinces in the northeast, lagging behind.
“We are confident the project will help realize the great growth and development potential of the northeastern part of Vietnam, particularly in trade, agriculture, and tourism,” he said
The provinces of Bac Kan, Cao Bang, Ha Giang, and Lang Son—the project area—have significant potentials to be trade hubs due to their strategic location, at the nexus of the People’s Republic of China, the capital Hanoi, the Hai Phong port, and the ADB-supported Greater Mekong Subregion North-South Economic Corridor. However, these potentials are yet to be fully realized, with gross domestic product per capita of the four provinces in 2015 remaining at USD1,160, almost half of the USD2,036 national average.
The project will improve road connectivity among the provinces by upgrading about 121 kilometers (km) of provincial and 144 km of district roads, provide rural water supply, benefiting 42,300 people, and improve agriculture value chain infrastructure in Lang Son province through farm-to-market connectivity and support to local businesses. It will also strengthen the capacity of the provincial governments, particularly on public asset management.
Total cost of the project is USD190.3 million, with the Government of Vietnam contributing USD40.3 million. The project is expected to be completed by the first quarter of 2023.
Besides loans for the northeastern provinces, ADB has also approved loans totaling USD149 million to help improve basic infrastructure services and promote inclusive and sustainable economic growth that will benefit over 1 million people in four provinces in the north central coastal region.
ADB’s assistance for the Basic Infrastructure for Inclusive Growth in the North Central Provinces Sector Project includes a regular loan of USD52 million and a concessional loan worth USD97 million. Both loans will be financed from the ordinary capital resources where most of ADB’s lending come from. The total cost of the project, is USD203.52 million, with the Government of Vietnam contributing USD54.52 million.
Economic development in the project provinces—Ha Tinh, Nghe An, Quang Binh, and Quang Tri—has been constrained by the fragmented coverage of basic infrastructure, with the 2015 poverty rate reaching 13% compared to the 7% national average. Moreover, the provinces are extremely vulnerability to weather-related disasters and are predicted to have the country’s highest increase in annual mean temperature at 1.7% and annual rainfall shooting up by 20%.
To address these issues, the project will improve connectivity among the provinces by upgrading and constructing about 214 kilometers of climate-resilient provincial and district roads, which will benefit more than 900,000 beneficiaries. It will boost business development through the construction and upgrading of rural water supply, flood protection, irrigation, and port services. It will also improve the capacity of the provincial governments, particularly in public asset management. The project is expected to be completed by the first quarter of 2023.
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