Washington DC, May 24, 2011 – Improving the efficiency of public investment by strengthening the four stages of investment cycle –project selection, project implementation, financial management and oversight – is the focus of a US$ 350 million operation from the World Bank to Vietnam, approved today.
This operation which is, part of Vietnam’s Public Investment Reform series was prepared in the midst of the 2009 global economic crisis, and helped Vietnam to avoid the adverse impacts of the global economic crisis, The first tranche of this operation amounting to US$ 500 million was approved by the Bank in December 2009.
“Since the country is facing enormous demand for infrastructure development in the coming years, strengthening the project cycle will play a key role in ensuring a high quality of public investment.” said Victoria Kwakwa, the World Bank’s Country Director for Vietnam. “We encourage the Government to continue the to reform program, especially in the SOE sector, in order to achieve higher productivity of state invested capital.”
The overall goal of the program is to support a series of policy measures that are expected to strengthen the management of public investment in Vietnam. This operation focuses in particular on the project implementation and financial management of public investments, including issues in environmental screening, bidding transparency, conflict of interest, dispute resolution, environmental management, reporting and control, administrative costs, environmental budgets, payment and disbursement, subsidies and guarantees, and monitoring and evaluation.
The program also facilitates infrastructure development in Vietnam by developing basic legal framework for PPP projects.
The major part of the financing (US$ 262.7 million) comes from the International Development Association – IDA – the World Bank’s concessional lending arm for low income countries. The rest (US$ 87.3 million) come from the International Bank for Reconstruction and Development – IBRD – the World Bank’s resource window for middle income countries.