Vietnam marked its 20 years of receiving international loans and grants, also known as official development assistance, or ODA, with a state-level conference on October 17th in Hanoi. Tuoi Tre talks to Mr. Hideo Suzuki, Minister of the Japanese Embassy in Vietnam to see how a single country’s ODA helps Vietnam and the donor itself. Japan is the biggest ODA donor to Vietnam.

* What are Japan’s interests in Vietnam that make it the biggest bilateral ODA donor to Vietnam?

First of all, Vietnam is a cornerstone of stability and prosperity and it is in the interest of Japan and other regional partners to have a strong Vietnam in terms of economy. To achieve that, we think we have helped the Vietnamese to have robust economic structure and the integrity of the whole territory. Vietnam is similar to Japan as both have a long extended territory. It’s very important that the whole territory goes along together, not only HCMC or Hanoi but the whole territory has to develop together. For that, we have done a lot in infrastructure, linking the cities, rural areas and urban areas, necessary facilities to export and for Vietnam’s market. Secondly, to achieve this stability in every sense of the term, we need poverty reduction. Of course we are doing a lot of things in this area.

There’s a misunderstanding that Japanese ODA is about infrastructure; but we have lot of education, healthcare, climate change, disaster relief, etc. which contribute directly to poverty reduction. Infrastructure is also a big tool because to achieve poverty reduction, transfer of prosperity from one part of the nation to other parts is needed so that we have bigger pie to share. Also, to have a bigger pie, we need macro-economic growth and the infrastructure that we are assisting contributes to this overall macro-economic growth and enhancing poverty reduction. Thirdly, I think VN is a key member of ASEAN. To have a stronger ASEAN is the common benefit of the region to have regional stability. These are in several words why we are investing immensely in Vietnam.

* What is the vision of Japan when you look at your ODA in Vietnam?

As I said, Japan is also very extended from north to south. In the 1960s-1970s, we achieved a very robust growth and this has been realized through a lot of infrastructure improvement like shinkansen, highway linking Tokyo, Nagoya and Osaka, and a lot of port infrastructure because we are, as Vietnam, a trade-reliant country. And we think that overall we have succeeded. A lot of geographical conditions in Vietnam make it possible to transfer this experience. That’s why we are doing all the infrastructure to have a homogeneous territory. The economy develops quickly. If you take time, you lose the business and opportunities. Take the highway 1 for example: it has very poor conditions and that means loss of economic potentials. We don’t want infrastructure to be an impediment to VN economy. So I’d like to see Vietnam infrastructure to link the country north to south, east to west, coast to coast.

* What do you see as missing parts in order to achieve that vision, taking into account that Vietnam has done a lot to improve infrastructure?

If you take a look at the last two-decade picture, no doubt Vietnam has made huge achievements. However I would like to mention two or three things. The most important thing is comprehensive planning: how to see Vietnam territory as a network at national level and sub-Mekong regional level. This is the technical basis. And then we need strong policy and strong political will. We are discussing the way to achieve industrialization by 2020 and at the same time, there is another forum to discuss infrastructure. There is a need for clear objectives to which the planning is subject to. Moreover, there is no missing piece if we talk about categories. You’ve got roads, railways, airports and seaports everywhere. Yet the rapid growth during the last decades has made the infrastructure something of the past, like Tan Son Nhat airport, Noi Bai airport, Hai Phong seaport, and so on. All that assisted growth has become victims of success. They simply do not fit anymore. We have to catch up and renovate constantly.

* And in turn, this ODA for Vietnam, how does it help Japan?

Besides what I mentioned earlier, for our own sake, we have a lot of investment in Vietnam and this infrastructure can be a benefit for both Japanese investors and Vietnamese entrepreneurs. And then, good infrastructure in Vietnam is also beneficial for neighboring countries.

* Do you worry about VN’s capability to pay back loans to Japan, considering that most of Japan’s ODA to Vietnam is loans and not grants?

No. Our loan to Vietnam is very congressional and it goes on for 30-40 years and interest rate is so low. Vietnam economy can easily catch up with this. Different missions from IMF also ensure us that Vietnam has the capacity to pay.

* Is there anything you’d like to see to be done better or are they up to your expectations?

One point I’d like to make is the speed: the speed of decision making and the speed of implementation, such as land acquisition among other things. These are crucial. If we take more time, it means more costs. This isn’t good for Vietnam, Japan or constructors. This is something we continue in our discussion with Vietnamese authorities.

* Thank you.