WB approves Vietnam poverty reduction plan

Ulhas Joglekar uvj at SPAMvsnl.com
Tue Apr 17 20:07:10 MDT 2001


Saturday
14 April 2001

WB approves Vietnam poverty reduction plan
HANOI, Vietnam: The World Bank has accepted Vietnam's poverty reduction
plan, opening the way for approval of a $250 million loan to support
economic reforms, an official said on Friday.
The plan includes reforms of Vietnam's banking sector and state-owned
businesses.
"We think the plan is a good one," said Andrew Steer, World Bank's country
director for Vietnam, adding "The general sense is that things are moving in
the right direction."
The World Bank has pledged about $2.5 billion in loans for 25 development
projects currently under way in Vietnam. But the $2, to be considered by its
board next month, would be the first to support Vietnamese economic reforms
and structural adjustments in about five years.
"We hadn't been able to reach agreement on a set of measures, including
banking reform and state enterprise reform," Steer said. But Vietnamese
officials have now developed a set of policies and reached a political
consensus on the need for their implementation, he said.
Last week, the International Monetary Fund (IMF) offered Vietnam a $368
million loan, its first in five years, following its approval of the same
interim poverty reduction plan.
The plan is aimed at boosting private investment and competitiveness of
Vietnam's economy, and calls for liberalisation of foreign exchange and
trade regulations and reforms of state-owned enterprises and state banks.
The World Bank said that Vietnam has made impressive progress in reducing
poverty in recent years, with the portion of its population below the
poverty line dropping from 70 per cent in the late 1980s to 37 per cent in
1998.
But it said that many people remained vulnerable to falling back into
poverty, and that groups such as women, rural residents and ethnic
minorities have not benefitted as much as others from the economic growth.
The World Bank said that Vietnam's economy grew by 5 1/2 per cent last year,
while the government's estimate is about one percentage point higher. The
bank predicts growth of between 5 1/2 per cent and 6 per cent for this year,
while the government expects about 7 per cent.
Some analysts said that Vietnam's Communist government might have lost some
of its enthusiasm for reform in recent months because of a conservative
backlash triggered by ethnic and religious unrest.
Steer said that the World Bank welcomed a further strengthening of Vietnam's
commitment to reform, but "we do not see a weakening." "There has been
important progress in the climate for private enterprise," he said.
Last year, Vietnam's reformers pushed through a landmark trade deal with the
US, a liberal private enterprise law, a stock market launch and a $1.5
billion natural gas deal, the first to give foreign companies control over a
major natural resource. (AP)
For reprint rights:Times Syndication Service








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