WB finance project benefits rural regions

Hanoi, July 23 (VNA) – Vietnam is the most successful country to deploy the rural finance project and is seen as a development model by financial institutions and donors. The assessment of donors, implementing agencies and beneficiaries was discussed at a workshop on completion assessment of the Third Rural Finance Project in Hanoi on July 21. The project is reported to have generated 9.8 trillion VND or 487 million USD for rural areas in Vietnam, thanks to the initial finance of 200 million USD from the World Bank. After five years of implementation, the project completed its first stage. By December 31, 2013, a total 200 million USD funded by the World Bank was disbursed thus helping to increase income for farmers and rural businesses. According to a representative of Mekong Economics (MKE), a leading economic consulting company in the Greater Mekong sub-region, finance from the World Bank created a large investment of the whole society for the agriculture sector in Vietnam. The MKE reported that 94 percent of end-borrowers said their incomes had improved after lending. Specifically, the project, with additional funding from local banks and people's credit institutions and contribution from end-borrowers, had created total investment of up to 487 million USD. Of this figure, 90 percent are medium and long-term investments. It is estimated that more than 135,000 people and businesses in rural areas had access to loans. The project had generated more than 140,000 new jobs. On an average about 65 million VND (3,095 USD) had found a new job. Speaking at the workshop, Victoria Kwakwa, World Bank's Country Director for Vietnam, said what they saw in this project was that financial institutions contributed their own resources into this project. Simultaneously, they also managed projects and ensured that they could do a good job of developing agriculture and rural development, reducing poverty and generating profit. Deputy PM Hoang Trung Hai appreciated the implementation of this project noting that it was a model one. Hai said the third finance project had done a good job noting that local relevant bodies needed to strictly review ODA funding by learning from this project. He also called on donors to continue assisting Vietnam in developing its economy, elevating poverty, and said that the Vietnamese Government was committed to using this funding in a transparent and effective manner. The objective of the Third Rural Finance Project for Vietnam is to increase economic benefits to rural private enterprises and households by increasing their access to finance. The Bank for Investment and Development of Vietnam (BIDV) was assigned with managing and implementing this important phase of the project. Totally, with this loan, the World Bank's funding reached 548 million USD for the rural finance project. After the end of the disbursement period, the project's funding will continue to up to 2033. It is estimated that it will help generate a total social investment of up to 5 billion USD from the revolving fund managed by BIDV.-VNA