HANOI,  July 14, 2003 - “Vietnam’s commitment to accelerating development, reducing poverty, and deepening its reform efforts is deeply impressive, and the World Bank is pleased to continue supporting Vietnam’s development strategy,” commented Mr. Jemal-ud-din (Jamil) Kassum, World Bank Vice President for East Asia and the Pacific, in his meeting with the press about his visit to Vietnam from July 8-15.  Mr. Kassum saw a number of important development programs in the Mekong and Central regions, before meeting with the leadership in Hanoi.

He continued, “Vietnam can produce a high rate of economic growth and share that growth equitably among its citizens.  We are looking forward to expanding our portfolio by 7 new projects totaling up to $700 million in the next 12 months.”

Support for Implementing Vietnam’s Comprehensive Poverty Reduction and Growth Strategy (CPRGS)

In his meetings with senior Vietnamese officials, Mr. Kassum praised the Government’s efforts in implementing the Comprehensive Poverty Reduction and Growth Strategy (CPRGS), and confirmed support for rolling out the CPRGS to provinces and adjusting sector strategies to its objectives.  The planned alignment of the CPRGS and budget allocation decisions in the Government’s budgetary system was particularly welcome.  He commended Vietnam’s remarkable achievement  in poverty reduction, as reflected in the latest living standards survey in 2002 with a dramatic drop of overall poverty from 37% in 1998 to 29% in 2002 (from 58% in 1993). 

Mr. Kassum also discussed the content and pace of reforms in Vietnam, and Government’s commitment to integration in the world economy.  He noted that Vietnam's economic reforms had been broadly on track over the last twelve months, although he shared the Government’s concern about the slow pace of state enterprise reform.

He said that the recently approved $100 million Poverty Reduction Support Credit 2 (PRSC2) will further support Vietnam’s reform efforts and the implementation of its current poverty reduction strategy, as summarized in the CPRGS.

Mr. Kassum also welcomed the Government plans to build a modern legal and public administration system and emphasized that without such a system in place, Vietnam would have difficulty in achieving its transition to a socialist market economy – and could also see growth potential being hampered by corruption and rent-seeking behavior.

Implementation of the agreed reform program, on time and without slippage, is absolutely essential. “Vietnam’s progress has been commendable, but greater efforts need to be made on the governance agenda for the public and private sectors; on increasing transparency; strengthening the legal framework; and fighting against corruption,” Mr. Kassum said. “Improving governance and strengthening the institutions for good governance takes time.  Vietnam cannot afford to delay.”

World Bank’s Support to Vietnam in Human Development

While in Hanoi, Mr. Kassum and the State Bank Governor Le Duc Thuy signed an important agreement: a $138 million interest-free credit for Vietnam’s Primary Education for Disadvantage Children (PEDC) project.

The largest primary education project in Vietnam, PEDC will help primary school-aged children including street children, disabled children, and girls in certain ethnic minority areas to complete the full cycle of primary schooling.  “This project responds to a more complex view of equity, by enabling the education system to define the concept of equity not only in terms of access to schooling, but also in terms of access to quality schooling,” said Mr. Kassum

“We highly appreciate the World Bank’s and other donors’ support to Vietnam and effective coordination and support with the World Bank staff and leadership in the fight against poverty in Vietnam.  The PEDC project is an important contribution to support Vietnam in achieving the targets set out in the CPRGS in general and the Education For All program in particular,” said State Bank Governor Le Duc Thuy.

The PEDC project is supported by a partnership between Vietnam, the governments of Australia, Canada, Norway, the United Kingdom, and the World Bank to ensure that Vietnam meets and maintains its goal of universal primary education and also improves the quality of primary education for disadvantaged girls and boys.  The total project cost is estimated as US$244 million of which the donors provide US$200 million.

“Much of Vietnam’s success to date has come through effective partnerships,” noted Mr. Kassum.  “This is an excellent example of how the World Bank working with other development partners can contribute to Vietnam’s efforts in fighting poverty and making a difference on a broader scale.”

Trips to Ho Chi Minh City and Can Tho, Quang Nam and Thua Thien Hue provinces

Mr. Kassum was pleased to visit development projects supported by the World Bank in the Mekong Delta and central Vietnam.  He experienced the dynamism of the Mekong delta region, having arrived in Can Tho on waterways newly dredged under the World Bank  funded Vietnam Inland Waterways and Port rehabilitation project; visited areas of the city which will be upgraded under the Urban Upgrading Project; and discussed priorities to develop Can Tho city’s infrastructure. 

In his visit to Kim Dong Primary School in Quang Nam province, Mr. Kassum was heartened by the progress made by teachers and pupils.  This school is supported by the World Bank financed Primary Education Project.

“I’ve been privileged during this visit to meet with Vietnamese people from all walks of life and in a great variety of places throughout the country.  I’m struck by the huge energy, great goodwill and sense of direction by people and Government alike,” said Mr. Kassum.

Mr. Kassum pointed to the stable if not increasing flow of assistance to Vietnam.  “This will benefit every Vietnamese in the next few years especially when the current efforts to improve ODA effectiveness in Vietnam succeed,” remarked Mr. Kassum.  “We are all committed to achieve concrete harmonization of procedures in areas such as procurement, evaluation and monitoring; a comprehensive capacity building program in the Government systems; and promotion of the CPRGS as a common framework for ODA planning, implementation and monitoring.”

During this visit to Vietnam, Mr. Kassum met with Deputy Prime Minister Pham Gia Khiem; State Bank Governor Le Duc Thuy; Planning and Investment Minister Vo Hong Phuc; Finance Minister Nguyen Sinh Hung; Agriculture and Rural Development Minister Le Huy Ngo; Chairman of the  People’s Committee of  Can Tho province Mr. Nguyen Phong Quang, Ho Chi Minh City Vice Chairman Nguyen Trong Nhan, and Vice Chairman of the  People’s Committee of Thua Thien Hue province Mr. Nguyen Ngoc Thien.  Mr. Kassum also met a number of leaders of the private sector in Ho Chi Minh City; and exchanged views on Vietnam’s prospects and ODA effectiveness with the World Bank’s development partners from development banks, the UN family, bilateral agencies and NGOs.

The World Bank in Vietnam:  Current portfolio includes 25 projects totaling over $2.7 billion to help fight poverty through finance for agriculture, infrastructure, health programs, schools, and other essential needs.  During the last 10 years, US$ 3.8 billion has been committed to Vietnam, in which $1.7 billion has been disbursed, which makes Vietnam the largest IDA-only borrower in the world. For more information on the World Bank in Vietnam,  please visit our Website at http://www.worldbank.org.vn.  For more information on the World Bank in East Asia and the Pacific region, please visit our regional Website at http://www.worldbank.org/eap.

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