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Vietnam Today

South Korea to provide $1.5 billion in ODA

Released at: 09:55, 10/06/2016

South Korea to provide $1.5 billion in ODA

Photo: Duc Anh

Infrastructure the focus but funds to go to a host of fields from now to 2020.

by Ha Nguyen

South Korea is likely to provide Vietnam around $1.5 billion in official development assistance (ODA) in the 2016-2020 period, with a large slice going to infrastructure.

Financial cooperation between Vietnam and South Korea and in other areas such as large-scale infrastructure, railways, healthcare, and IT will be prioritized, a meeting between the Ministry of Planning and Investment (MPI) and South Korea’s Ministry of Strategy and Finance on June 8 heard.

Mr. Sang Kyu Lee, a representative from South Korea’s Ministry of Strategy and Finance, said that South Korea has promoted exchanges and cooperation with Vietnam in the fields of economics, culture, and society.

Since the two sides are preparing to negotiate a Credit Framework Agreement for 2016-2020, the ODA is also to come. “The South Korean Government attaches special importance to development cooperation in such fields as transport infrastructure, urban development, healthcare, education, the environment, clean energy and IT,” Mr. Lee said.

He revealed that the South Korean Government is formulating a Country Partnership Strategy (CPS) for Vietnam in order to help the latter achieve the objectives in transport infrastructure, IT, and scientific and technological human resources contained in its socio-economic development strategy for the 2011-2020 period and socio-economic development plan for 2016-2020.

Vietnam received around $2.8 billion in ODA from South Korea from 1992 to 2015 in some 60 projects, official figure show.

Mr. Le Quang Manh, Head of MPI’s Foreign Economic Relations Department, told the gathering that financial cooperation will be a key feature of overall cooperation between the two countries in the near future. “Vietnam needs to take advantage of financial support from the South Korean Government and the Korea International Cooperation Agency (KOICA) and continue to mobilize support from South Korea in areas where it has experience and strength and Vietnam has demand, such as transport, health, environment, and high technology,” he said.

ODA and preferential loans have tended to decline since Vietnam became a middle-income country in 2010, according to MPI. The country plans raise $39.5 billion in ODA and preferential loans between 2016 and 2020 to boost economic growth.

Total ODA and preferential loans from donors fell during the first half of 2016, according to a report released by the National Steering Committee (NSC) at a meeting on June 8.

Deputy Prime Minister, Minister of Foreign Affairs and Head of the NSC, Mr. Pham Binh Minh, pushed relevant ministries following new regulations contained in Decree No. 16 on the management of ODA and preferential loans.

The NSC report stated that there are still many shortcomings in the management of projects, where delays in administrative procedures remain. The causes are primarily institutional and legal or in land clearance. Total ODA disbursement in the first half of 2016 was roughly equal to the same period last year, according to NSC.

But Vietnam has seen some $22 billion in ODA loans not yet disbursed due to delays. “$2.15 billion of this must be disbursed this year and the remainder between now and 2020 or even after 2020,” Minister and Chairman of the Office of the Government, Mr. Mai Tien Dung, told a press conference in early June.

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