The Asian Development Bank (ADB) will continue assisting the Vietnamese government through sovereign lending of about US$1 billion annually, its president said at a press briefing Friday.
The bank is preparing the 2016-2020 Country Partnership Strategy, which aims to help Vietnam promote more inclusive and environmentally sustainable economic growth, Takehiko Nakao said.
Transport infrastructure, recycled energy development, climate change resilience, poverty reduction, state-owned enterprise restructure, and private sector development will be prioritized fields, he said.
“It is crucial that Vietnam continue pursuing sound economic policies and deepen structural reforms,” said Nakao. “It is particularly important to reform state-owned enterprises by reducing the state’s ownership, improving corporate governance, and strengthening financial performance. The government also needs to resolve non-performing loans, strengthen tax revenues, and improve efficiency of public expenditures.”
The Manila-based bank will also provide assistance in expanding community healthcare centers and broadening health insurance coverage from the current 76 percent. In education, it will deepen its support to improve the quality of secondary education and extend support to technical and vocational education and training.
The ADB will support infrastructure development and will also increase private sector lending and equity investments.
Vietnam has increasingly become susceptible to climate change-related extreme events such as droughts and flooding that severely affect agriculture, forestry and fisheries. Adaptation and mitigation will be crucial areas for ADB’s loans and technical assistance, Nakao said.
The ADB has worked in close partnership with Vietnam since 1993 when it resumed operations in the country. As of the end of last year, the bank has provided $14.4 billion in loans, $276.6 million in technical assistance and $318.3 million in grants to Vietnam.
The bank expects an economic growth of 6.7 percent for Vietnam this year, the same rate as in 2015, although there is a downside risk due to an ongoing severe drought. Growth is projected to remain robust at 6.5 percent in 2017.
During his two-day visit to Vietnam, Nakao met with Vietnam's President Tran Dai Quang and Prime Minister Nguyen Xuan Phuc.
Phuc has called for the ADB to offer more preferential loans to Vietnam and help the country strengthen economic reform and poverty reduction efforts.