Closing the fiscal year 2013 (ended March 2014), Japan’s ODA loans to Vietnam were valued at some 200 billion yen (US$1.97 billion.) This was a big amount in comparison with the fiscal years 2011 and 2012. Mr Mutsuya, Chief Representative of JICA, said Japan’s ODA loan to Vietnam in the fiscal year 2014 will be at least as much as in fiscal 2013.
He said that Japan will carry out 12 technical cooperation projects and 71 training courses in Japan for Vietnam.
The Chief Representative of JICA Vietnam said Japan’s ODA loans for Vietnam are not small (accounting for about 30 percent of total ODA in Vietnam) but the ODA repayment will not cause heavy pressures on Vietnam (in 2012, Vietnam repaid 34.8 billion yen (US$343 million) of ODA loans) because most of the loans have low interest rates. However, as ODA loans increase, repayment pressure will be heavier.
Before 2014, Japan's ODA focused on infrastructure projects, especially road transport system. Difficult site clearance still dragged on the progress of many projects. He recommended that Vietnam have regulatory mechanisms for issues that prolong project progress, particularly site clearance.
Mutsuya said when investors and contractors sign agreements on construction site handover, contractors embark on construction planning, personnel recruitment and material purchase. But if the land handover is behind schedule, contractors will breach contracts with other partners, leading to difficulties in paying bank interests and increased costs. Therefore, to enhance accountability and teamwork, he said any contractors will refuse to sign contracts if they have to bear the costs arising from site clearance.
Currently, Japan’s ODA for Vietnam has been channelled into many areas with very high efficiency and huge contributions to comprehensive and dynamic socioeconomic development of Vietnam like economy, finance, transportation, human resources training, SME support, environment, health and agriculture. As for infrastructure construction projects, in addition to creating facilities for transportation, projects also create 1,000 jobs each day.
Mori Mutsuya also stressed that “Vietnam should have policies to attract private investment into public works.”
In addition, Japan will help Vietnamese farmers to produce safe agricultural products that any farmer can grow rather than focus much on such standards as VietGap as now because they are difficult for farmers".
In 2014, JICA will continue to cooperate closely with Vietnam to gradually improve the social life and head for a safe future society with lots of options for younger generations. Accordingly, Vietnam’s socioeconomic development is not simply increasing indicators but also strengthening connectivity for employment generation and income increase for the people.
Vietnam is still a developing country whose capital demand for social and economic life development is huge. Thus, according to JICA Chief Representative, the Government of Vietnam needs to look at ways to prioritise private capital mobilisation, not relying on just ODA as now. Private capital in public infrastructure development projects is “not much.” Mr Mutsuya explained that formulating and fundraising for public-private partnership (PPP) projects is very difficult and PPP projects are not many in Asian countries. So far, Japan has provided a large amount of ODA for Vietnam to build infrastructure. Expectedly, by 2015, two major Japanese ODA-funded projects - Nhat Tan Bridge (Vietnam – Japan Friendship Bridge) and Passenger Terminal 2 at Noi Bai International Airport - will be completed.
Mobilising synergised strengths from the people, businesses and organisations abroad will create conditions for the economy to receive a significant investment source. This will diversify capital sources and enhance capital using efficiency. JICA, as an international cooperation organisation with rich operating experience in Vietnam, will provide maximum support for the Government of Vietnam to organise and coordinate the implementation to achieve the highest efficiency.
Luong Tuan
Vietnamese
