World Bank agrees to help poor communes in Vietnam

Jul 9, 2009, 8:36 GMT

   Hanoi - The World Bank and the State Bank of Vietnam on Thursday signed two credit agreements to provide Vietnam with a total of 300 million dollars to help poor and rural communes improve the quality of life.

   The credits from the International Development Association, the World Bank's concessional lending arm, will be injected directly into the state budget.

   'Both operations reaffirm the World Bank's strong commitment to Vietnam's growth and poverty reduction efforts at a time when the country is confronted with adverse effects from the global economic slowdown,' said Victoria Kwakwa, country director for the World Bank in Vietnam.

   The World Bank is providing 100 million dollars to the state budget in support of government's P135 Phase 2 program, which provides support to over 2,000 poor communes in 47 of Vietnam's 64 provinces.

   This funding will support government and community efforts to reduce poverty in ethnic minority and other remote communities by equalizing access to social infrastructure and services.

Program 135 Phase 2 has funded thousands of kilometers of improved roads, rural schools, potable water supplies, improved seed and livestock, and boarding support to encourage primary school attendance.

   The World Bank is also providing 200 million dollars in additional financing for the ongoing Rural Energy II project so that an estimated 550,000 additional households can benefit from reliable and affordable electricity.

   Vietnam is considered an example of a successful electrification programme. From 1993 to the end of 2008, the access rate of rural households to power increased from 14 per cent to 94 per cent.