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Ha Noi, Viet Nam (2 February 2010)

The Asian Development Bank (ADB) and the Government of Viet Nam today signed a loan agreement of $45 million for the Central Region Rural Water Supply and Sanitation Sector Project to support the countrys efforts to achieve the national development targets and Millennium/Viet Nam Development Goals relating to peoples’ access to clean water supply and sanitation.

At the signing ceremony, State Bank of Viet Nam’s Governor Nguyen Van Giau represented the Government, and ADB Country Director for Viet Nam Ayumi Konishi represented ADB.

The project will provide clean water and hygiene sanitation facilities to some 350,000 people in the six central coast provinces of Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Nam and Binh Dinh where the poverty levels are higher than the national average.

"Access to clean water and hygienic sanitation is critical for improvement of health and living conditions of people who are living in rural areas," said Mr. Konishi. "The project will also reduce the burden on women and girls who are traditionally tasked with water collection and caring for sick family members."

Communities in the project provinces will be fully involved in the implementation of the project with grants and credit being provided directly to households to build latrines. Poor households will be supported with grants while credit will go to households not designated as poor through a revolving fund managed by the Viet Nam Women’s Union. To improve hygiene awareness, water and sanitation commune committees will be formed to support information and education activities, with at least 40% of the members, to be women.
The Government of Viet Nam has made significant efforts to stay on track to meet its goal of providing access to clean water to 85% of the total population by 2010. While this goal is being achieved, the sustainability of water supply is affected by cost barriers, and communities are often overlooked in the planning and provision of services. With regard to improved sanitation, progress has been slower and it is unlikely that Viet Nam will meet its 2010 target of 70%. One of the difficulties is that in Viet Nam around 75% of the population lives in rural areas, where knowledge of hygienic practices is still limited. The project will address these issues.
ADB’s loan, from its concessional Asian Development Fund, covers 90% of the project cost of $50 million. The loan has a 32-year term, including a grace period of 8 years. The Government of Viet Nam and project beneficiaries will make up the balance of the cost with in-kind and cash contributions totaling $5 million. Ministry of Agriculture and Rural Development is the executing agency for the project, which is due for completion around the end of 2016.
ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region.

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