Viet Nam receives $35 million UN loan for rural development
Praising Viet Nam’s efforts to reduce rural poverty, the head of the United Nations International Fund for Agricultural Development (IFAD) today signed a $35 million loan agreement to expand market access and develop businesses for tens of thousands of small farmers in the Mekong Delta.
“The Government of Viet Nam has made remarkable progress in reducing poverty even in rural areas,” IFAD President Lennart Båge said on an official visit to Hanoi, citing the need to include rural people in the economic surge.
The country’s rural poor must be given the chance to place their products on the national and global supply chain if extreme poverty is to be eradicated in Viet Nam, he added.
As one of the fastest growing economies in the world, Viet Nam has cut poverty from 60 per cent to 20 per cent in little over a decade. Extreme poverty still exists however, especially in rural areas where 45 per cent of people still live below the poverty line compared with nine per cent in the cities.
“One of the ways to ensure that poor rural people also benefit from this phenomenal growth is by creating the right market conditions for private investors in agriculture and their cooperation with farmer households,” Mr. Båge said.
Besides the $35 million loan, IFAD is also providing a $550,000 grant to assist poor households in Ben Tre and Cao Bang provinces in developing market-based agricultural production and business.
The project – “Developing Business with the Rural Poor Programme” – will bring IFAD’s total loan commitment in Viet Nam since 1993 to $168.3 million.
The programme focuses on improving the local investment environment, developing rural businesses, and expanding market access for poor rural people so that they are better positioned to gain the added value from their produces. About 44,400 households in Ben Tre and 55,200 in Cao Bang are set to benefit from this programme.
“The Government of Viet Nam is to be lauded for its recognition of the role of the rural poor as custodians of the natural resource base in its National Socio-Economic Development Plan,” Mr. Båge said.
“The key is to now help them by investing in technology and financing to halt land degradation and deforestation whilst at the same time increasing wealth in rural areas where the vast majority of the country’s poor live.”