Vietnam and France exchange financing agreements for water management project in Dien Bien

Vietnam and France exchange financing agreements for water management project in Dien Bien

On the afternoon of September 10 at the Élysée Palace in Paris, Vietnamese Minister of Finance Ngo Van Tuan and French Development Agency director general Christophe Lecourtier exchanged a loan agreement and a grant agreement in the presence of Party General Secretary and State President To Lam and French President Emmanuel Macron.

Photo: VNA

The agreements cover the project “Integrated Water Resources Management for Livelihoods, Climate Change Adaptation and Socioeconomic Development in Tuan Giao District, Dien Bien Province.”

The project is being implemented in Tuan Giao, with Dien Bien People's Committee serving as the project owner and the Department of Agriculture and Environment acting as the implementing agency.

The project proposal was approved under Decision No.836/QD-TTg dated August 15, 2024. Dien Bien People's Council approved the investment policy under Resolution No.215/NQ-HDND dated December 10, 2024, while Dien Bien People's Committee approved the project under Decision No.1139/QD-UBND dated June 6, 2025.

The project will be financed through an AFD loan and a grant from the Water and Natural Resources Management Fund, which is entrusted to AFD for management.

Under the approved project plan, total investment is estimated at nearly VND1.39 trillion ($54 million), comprising an AFD loan of $45 million, a $1.7 million non-refundable grant and nearly $12 million in counterpart funding.

The loan has maturity of 18 years, including a seven-year grace period, and is denominated in euros, with an interest rate of six-month EURIBOR plus 0.97 per cent per year.

The project aims to improve the management and efficient use of water resources, regulate water supplies between river basins, address drought, prevent erosion and flooding, and strengthen climate change resilience.

It will provide a stable water supply, regulate water flows and reduce disaster risks, while increasing crop productivity and facilitating the development and expansion of long-term industrial crops such as macadamia. This is expected to increase the economic value of local agriculture and encourage farmers to shift from traditional crops towards more sustainable, higher-value farming models.

The project will also provide domestic water supplies for 35,000 people and irrigation for 21,000 hectares of agricultural land. It will gradually complete the local irrigation infrastructure and connect water regulation networks across sub-regions, facilitating water resource exploitation, management and operation.

The project is also expected to strengthen climate change adaptation in Tuan Giao and Dien Bien province, green degraded hills, protect the environment and contribute to reducing greenhouse gas emissions.

VIR