Vietnam holds strong economic growth potential: ADB
Vietnam holds strong economic growth potential: ADB
Vietnam continues to hold strong potential for sustaining high economic growth, helped by its prudent fiscal management, low inflation, healthy current account balance, and strong foreign direct investments, said Takehiko Nakao, President of the Asian Development Bank (ADB).
Nakao was speaking at his meeting with Vietnamese Prime Minister Nguyen Xuan Phuc on the sidelines of the G20 Leaders’ Summit in the Japanese city of Osaka on June 29.
The bank said in a statement that the two discussed Vietnam’s macroeconomic performance and the ADB’s continued engagement with the country. Their last meeting was held in late June 2018 in the central coastal city of Danang.
Vietnam’s macroeconomic performance has been solid in recent years, with real gross domestic product growth at 6.7% in the first half of this year and 7.1% in 2018, the fastest growth rate in more than a decade.
Vietnam is positioning itself effectively in the changing landscape of regional and global value chains, according to Nakao.
He also commended the structural reforms being implemented by the Vietnamese Government, including the establishment of the Commission for the Management of State Capital as a key part of the Government’s State-owned enterprise reforms.
ADB has been among the largest development partners supporting Vietnam over the years, operating through project loans in transport, water supply and sanitation, energy, agriculture, and education.
ADB has also provided policy-based loans promoting reforms in public expenditure, financial sector, and health.
ADB is assisting Vietnam’s regional cooperation and integration through the Greater Mekong Subregion (GMS) Economic Cooperation Program, including by supporting the implementation of the Hanoi Action Plan, which was endorsed at the 6th GMS Summit held in the Vietnamese capital city in March 2018.
ADB’s sovereign lending in 2018 was US$689 million in concessional terms. In addition, ADB committed US$300 million in nonsovereign lending to support small and medium-d enterprises and municipal waste-to-energy conversion.
Prime Minister Phuc expressed his appreciation for ADB’s support, saying that Vietnam will need continued support for infrastructure development, as well as innovative financing solutions, to attract greater private sector investments.
In response, Nakao said the bank stands ready to continue to provide strong support to Vietnam in the coming years in areas such as urban rapid transit systems, highway modernization, water supply and sanitation, and climate resilient urban and rural infrastructure.
“We will also extend our support to foster more public-private partnerships and continue our nonsovereign lending. ADB’s capacity building work is helping improve the credit worthiness of selected State-owned enterprises,” he added.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to US$21.6 billion. Founded in 1966, it is owned by 68 members, with 49 from the region.
