Project News

French assisted $29 million for urban development

Vietnamese Ministry of Finance and the French Development Agency (ADF) on Thursday May 5th signed a 20 million euro loan agreement ($29 million) for assisting Ho Chi Minh Finance and Investment Company (HFIC) to develop urban fund in Ho Chi Minh City.

Vietnamese Ministry of Finance and the French Development Agency (ADF) on Thursday May 5th signed a 20 million euro loan agreement ($29 million) for assisting Ho Chi Minh Finance and Investment Company (HFIC) to develop urban fund in Ho Chi Minh City.

This financing agreement aims at helping Ho Chi Minh City to face its objectives in terms of socioeconomic development and to meet the challenges of its urban growth, encouraging in the same time the measures undertaken to handle with climate change. This project is fully in line with French cooperation in Vietnam.

The sustainable growth of Ho Chi Minh City generates considerable challenges. Urban growth is rapid and population is increasing significantly. The city will end up being subjected to the effects of the rise in the water level.

City planning needs are considerable and the city has defined a strategy of urban development for the Ho Chi Minh City agglomeration up to 2025, based on a population forecast of 10 million inhabitants.

Those implementation needs involve the execution of large-scale projects (transportation, drinkable water, decontamination, electricity and waste treatment) and middle size infrastructures (sewerage, health, education, social housing).

The programme partially financed by AFD through the urban development fund of Ho Chi Minh City (HFIC) will enable the building of social housings and education institutions, as well as the reinforcement of capacity and care of hospitals, and the modernising of waste collect and management.

The total cost of the programme comes to 96 million euros, the AFD’s loan to the Vietnamese government, on-lent to HFIC, covering about 20 per cent of the costs. Cofinancings are provided by public (government, municipality and companies) or private structures.

HFIC has been the first municipal investment fund in Vietnam, set up in 1996 in order to finance middle size urban infrastructure projects. From 2006, the AFD has been the first investor to support HFIC, granting a first credit line of 30 million euros.

In parallel, AFD has accorded a 1.5 million euro grant for the reinforcement of HFIC’s management capacities (assistance to the financial management of the fund, support in term of social and environmental assessments).

With this new financing agreement, the total cumulated net commitments of the AFD for public official development assistance (ODA) in Vietnam will amount to about 1.05 billion euros.

(Nguồn tin: )