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World Bank to grant Vietnam up-to-$7bn loan for major projects

World Bank to grant Vietnam up-to-$7bn loan for major projects

Monday, December 04, 2023, 15:08 GMT+7
World Bank to grant Vietnam up-to-$7bn loan for major projects
Vietnam’s Prime Minister Pham Minh Chinh and his subordinates (L) are seen at a meeting with World Bank president Ajay Banga along with other bank officials on the sidelines of the UN climate change summit (COP28) in Dubai, United Arab Emirates, December 2, 2023. Photo: D.Giang / Tuoi Tre

The World Bank (WB) will provide a loan of up to US$7 billion for Vietnam to develop a number of key projects, including a 39km express railway in Hanoi, according to a recent agreement between the WB’s leader and Vietnamese Prime Minister Pham Minh Chinh.

WB president Ajay Banga and the Vietnamese government leader reached a consensus on Friday when they met on the sidelines of the 28th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP28), which opened in Dubai, United Arab Emirates, last Saturday.

Accordingly, a WB loan of $5-7 billion will be provided for Vietnam in the next three years to finance a number of important projects in various fields.

Prominent among these projects is the Van Cao-Hoa Lac high-speed railway, a 39km metro line connecting Van Cao Street in Hanoi’s Ba Dinh District to Hoa Lac, a satellite urban area of the capital.

As one of Hanoi’s priority projects, this metro line, with a 6.5km underground section, is expected to cost VND65.4 trillion ($2.48 billion).

Another large project is the Vietnam Renewable Energy Accelerating Change (REACH), while the others are intended for planting one million hectares of high-yield and low-emission rice, for building infrastructure in adaptation to climate change in the Mekong Delta, and for digital and green transition models.

Amid the WB's global restructuring efforts, Prime Minister Chinh has proposed the establishment of a regional center with its office based in Vietnam.

He further pledged that the Vietnamese government would facilitate optimal conditions for the office to oversee WB-funded projects in Vietnam and other countries in the region.

PM Chinh also thanked the WB for its support for Vietnam over the past years, particularly in policy consultancy and funding, which have significantly contributed to socio-economic development, hunger eradication, and poverty reduction in the nation.

Banga expressed high appreciation for Chinh’s suggestion and conveyed his commitment to carefully consider setting up a regional WB center.

The bank president congratulated Vietnam on its recent considerable economic achievements and attributed them to the effective leadership of the national government.

WB treats Vietnam as one of its important partners and will continue giving support to the Southeast Asian country, Banga stressed. 

He commended the Vietnamese government for its efforts and determination in advancing the green transition, responding to climate change, and fostering sustainable development.

The president recommended that Vietnam explore participation in the global carbon credit market, while pledging to support the country throughout this endeavor.

This support extends to Vietnam's pursuit of its climate commitments and targets, including the ambitious goal of achieving net-zero emissions by 2050.

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Vinh Tho - Ngoc An / Tuoi Tre News

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