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									       ISG Plenary Meeting

Investment Orientation for the
Development of the New Rural
   Areas in Vietnam Asian

          Ayumi Konishi
    Country Director for Viet Nam
      Asian Development Bank
     10 November, 2010, Ha Noi
         Congratulations!

• For Viet Nam to have become a Middle
  Income Country
• For Thang Long Ha Noi 1000
• For being a successful ASEAN Chair in 2010
• For hosting the International Rice Congress
• For convening this ISG meeting
• ……and a lot more
        New SEDS/SEDP
• Focus on “Inclusiveness” of the
  socioeconomic development of Viet
  Nam – i.e., not to let the rural areas to
  be left behind
• Focus on “environmental sustainability”
  through improved natural resources
  management, environmental protection
  measures, and measures to address
  climate change
Planning on the Development
     of New Rural Areas
The first program under the Prime Minister’s
  Decision approving the National Target
  Program on Building New Rural Areas is
  entitled, “Planning on the Development of
  New Rural Areas”. Planning is the first step
  and this is the subject for my presentation.
Major Agriculture Sector Issues
• Agriculture growth, productivity improvement
  and diversification have been impressive
• ANRE activities remain critically important for
  the majority of Viet Nam’s households and for
  future efforts at poverty reduction
• However, crop production remains dominated
  by paddy commodity
• output quality is typically poor by regional
  standards
• little value addition, and need to improve the
  sector’s technological base
• Food safety and environmental concerns
Major Natural Resources Sector Issues

• Natural resources are under ever-increasing
  pressure
• Anticipated effects of climate change are likely
  to be particularly severe
• Sector factor market conditions are deficient in
  several major respects
• Overall enterprise structure is dominated by
  (inefficient) SOEs and (undercapitalized)
  agriculture and micro-business units
            However……..
• Sector planning is technically weak in some
  areas
• Staff capacity is limited and performance
  management issues affect MARD, MONRE, etc.
• Total amount of public expenditure devoted to
  the sector is still low
• There are problems in the distribution between
  capital and recurrent spending
• Decentralization is changing responsibilities
  for public expenditure management
• Sector management is becoming more
  complex, and there is a need to modernize the
  role of state institutions in service delivery
Breakdown of ongoing ADB loans
      (as of 31 July 2010)

                                             Multisector
                                              1.14%        Agriculture and Natural
     Water and Other
                                                                 Resources
   Municipal Infrastructure
                                                                   14.03%
        & Services
           5.42%
                                                                           Education
                                                                            6.26%




 Transport and ICT
      34.65%
                                                                              Energy
                                                                              32.79%


  Public Sector
  Management
     2.41%


Industry and Trade
      0.37%
                              Health and Social            Finance
                                 Protection                 0.64%
                                   2.28%
     Breakdown of ongoing ADB TAs
                              ( as of 31 July 2010)

                                               Multisector
                                                1.90%                  Agriculture & Natural
          Water and Other Municipal
          Infrastructure and Services                                       Resources
                     10.12%                                                  21.97%




Transportation and ICT
                                                                               Education
       18.14%
                                                                                2.63%


  Public Sector Management
            3.28%
                                                                               Energy
                                                                               20.23%

    Industry and Trade
         14.55%
                                                             Finance
                           Health, Nutrition and Social       4.59%
                                    Protection
                                      2.58%
   Lessons from ADB Experience
• Projects’ efficiency has been compromised by
  implementation delays
• Sustainability of investments (e.g., in rural
  infrastructure) is threatened by O&M financing/cost
  recovery concerns
• There is a need to get the strategic setting of
  investments right
• Ensure high levels of Government ownership
• Support day-to-day implementation with sufficient
  levels of in-country resources
• Ensure sufficient project financing
• Avoid overlaps in geographical coverage and
  investment scale and scope
Then, what can we do together?
• Capacity building at different levels/areas
• Crop diversification
• Introduction of technology to move to higher
  value added
• Sector reforms
• Development of rural infrastructure and their
  appropriate maintenance
• …and more
Thank you for your attention!


For information on ADB activities in Viet Nam:
  • Please Visit Viet Nam Resident Mission web site
    at http://www.adb.org/vietnam or
  • Email to adbvrm@adb.org

								
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