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International donors and development partners on Friday decided to commit 8 billion U.S. dollars in Official Development Assistance (ODA) to Vietnam next year, up by one third from this year's commitment of 6 billion dollars.

The figure is announced at the 2009 Consultative Group (CG) Meeting for Vietnam. The meeting is co-hosted by the World Bank (WB) and Vietnamese Ministry of Planning and Investment. Vietnam's GDP stood at around 90 billion U.S. dollars last year, WB statistics showed.

Among the package, 1.4 billion dollars are in grant while the rest 6.6 billion dollars are loans, said Vietnamese Planning and Investment Minister Vo Hong Phuc at a press conference after the meeting.

"Vietnam is appreciative of the strong and precious support from donors, especially given that the world is suffering from the global financial crisis," said Phuc.

Donors contributing to the commitment include 24 countries, some non-government organizations, the Asian Development Bank (ADB), European Commission, United Nations agencies and the World Bank.

The World Bank is the biggest donor contributing 2.5 billion dollars. It is followed by Japan of 1.64 billion dollars and ADB of 1.48 billion dollars.

World Bank Country Director for Vietnam Victoria Kwakwa said at the meeting that the development partners and the Vietnamese government had fruitful discussion during the two-day CG Meeting on issues like economic policy orientation and poverty reduction.

The two sides shared the view that ensuring macro-economic stability is vital for Vietnam to regain the high growth rate, said Kwakwa. Vietnam should continue to improve the productivity and competitiveness of its economy, especially in the state-owned enterprise (SOE) sector that constituting a major part of the economy.

The donors also held that Vietnam should closely monitor the impact of the global economic crisis on the country's poor and vulnerable groups, especially the ethnic minority group, said Kwakwa.

Kwakwa said the population of the minority group in Vietnam, though making up only a small proportion of the country's total population, is a large number. The International donors will work together with Vietnamese government to engage in the poverty reduction process.

In the first 11 months of this year, Vietnam's ODA registration reached 5.44 billion U.S. dollars. The disbursed ODA stood at 2 billion dollars.

Commenting on the disbursement rate of ODA, the World Bank leading economist Martin Rama said that a lot of reasons led to the delay of ODA projects, including slow land reclamation process and the poor infrastructure.

Vietnamese Planning and Investment Minister Vo Hong Phuc said the disbursement rate is low, but it is improving over the past couple of years. "We are aware that the disbursement is vital to the real development. We will work together with the donors to improve the rate," said Phuc.

The CG meeting is held twice a year in Vietnam, drawing representatives of international donors, foreign missions and Vietnamese governments.

The meeting provides a forum for discussions of Vietnam's social and economic situation. The year-end meeting always turns out the scale of assistance by international donors to Vietnam for next year.

Source: VNBusinessNews