Vietnam: Adapting to a Rapidly Changing Country
published on 01 December 2019
In Vietnam, over the past ten years, AFD interventions have been more strongly focused on climate change and support for urban development.
The country evaluation jointly carried out with the Directorate General of the Treasury and the Ministry for Europe and Foreign Affairs affirmed the overall relevance of the positioning of French development assistance, and the successful adaptation of its interventions to the changing development challenges. France stands out from most donors inasmuch as its interventions integrate sustainable development and climate challenges in a cross-cutting and almost systematic way.
Thus, in the areas of climate change, AFD has managed to adapt its aid modalities to the country’s challenges by co-financing a climate policy loan – the Support Programme to Respond to Climate Change (SP-RCC) – with the World Bank and the Japan International Cooperation Agency (JICA). This policy-based loan was one of the first climate budget support loans to be approved by AFD in 2009. The policy dialogue between the donors and the Vietnamese Ministry of Environment and Natural Resources has been a key, well-structured component but has not led to any major involvement by the other ministries concerned. Despite the modest funds allocated to technical assistance, the Vietnamese appreciated AFD as a valuable partner in the dialogue. In the energy sector, AFD has drawn on its substantial operational knowledge to feed the dialogue.
Further reading: Evaluation Summary - Policy loan "Support Programme to Respond to Climate Change (SPRCC)
The SP-RCC has helped to formulate and improve climaterelated policies. It has also helped to quicken the formulation and enactment of the associated regulations. However, the evaluators were unable to demonstrate that the SP-RCC had helped to raise the ambition of the policies supported. A more detailed analysis of the lessons learnt from the implementation of policy-based loans is developed later in this report (see p. 16).
Supporting urban development
AFD has supported the Municipal Development Funds since 2005, and is the only international donor, alongside the World Bank, to finance them. As public financing institutions, these funds are established on the initiative of each province’s People's Committee to finance priority infrastructure as part of their provincial development strategy via various financial tools, such as loans, direct investment and equity participation.
This intervention method is particularly relevant to meeting the growing needs for basic services among urban populations (health, education, transport infrastructure, etc.).
The evaluation of three AFD-supported urban funds in Vietnam (Ho Chi Minh City, Can Tho and Da Nang) shows that they responded to the urgent need to develop urban
infrastructure in a macroeconomic climate still under the effects of the 2008 financial crisis. The supported funds have financed basic infrastructure projects (transport, electricity, social housing, healthcare, etc.) that achieved their objectives, but proved more successful in social than environmental terms. These interventions were also aimed at strengthening the funds’ capacity to appraise and monitor investment projects.
Capacity building results have been more mixed for the Can Tho and Da Nang funds. At an institutional level, the evaluation recommended that provincial committees and the government step up their support to these funds.
Flexibility to meet Vietnam's needs
Adapting to climate change, promoting sustainable and inclusive urban development and supporting modernisation of the productive sector are some of the new challenges facing Vietnam. While the French stakeholders (Ministry for Europe and Foreign Affairs, the Directorate General of the Treasury and AFD) have been present in these priority areas, the country evaluation shows that they have also exercised flexibility in meeting the needs expressed by the Vietnamese.
While rural development interventions were preponderant in AFD’s intervention portfolio before 2007, they are now pursued on a smaller scale, and many donors have altogether abandoned this theme in Vietnam. Access to development for minorities has also been taken into account by specific French interventions. However, this theme has generally lacked the financial resources to meet the needs expressed by the Vietnamese over the evaluated period. The aim of the irrigation development project in the province of Ninh Thuan4 was to increase farm income for the territory’s ethnic minorities to allow them to better integrate into the region. This rural development project specifically targeted minorities while meeting the need to adapt agricultural practices to climate change.
The project evaluation shows that five hydraulic structures on the tributaries of the Cai River and the planned canal networks were built, ensuring the irrigation of 2,800 hectares of land. Although the reservoirs meet water demand during periods of normal rainfall, they are unable to meet irrigation needs in the event of a rainfall shortage. While the project aimed for two to three crop cycles a year, the evaluation observed that the land could yield only one crop during drought years. The project failed to adequately monitor and supervise the use of water resources. The technical choices were not properly suited to irrigators’ practices or the changes in climate. Furthermore, the evaluators were unable to find monitoring or evaluation data on the environmental impact of this project.
In conclusion, Rémi Genevey, AFD’s Director of the Asia Department, considers that evaluations of policy-based loans or specific projects and broader-based evaluations (e.g. a specific geography) are a valuable contribution to guiding country strategies and changes in practices. He points out, for example, that “the country evaluation has helped to confirm and consolidate AFD’s strategic positioning in Vietnam on the fight against climate change and on the resilience of regions and communities”.
Interview
Olivier Gilard
Water and Sanitation Project Manager at AFD, Evaluator of the Drinking Water Supply Programme in the Mekong Delta
“The exercise is fascinating and helps to improve the projects I'm currently setting up. In some ways, it's the only chance a project manager gets to analyse a project from the identification stage through to completion.”
Olivier Gilard
How did the project you evaluated meet the urban development challenges in Vietnam?
Given the country’s demographic growth and fast-paced urbanisation over the last 30 years, colossal investment is needed to develop services that are increasingly in demand
from communities. Initially identified as the first in a series, this project was well-aligned with this issue.
What are the results of this project?
The investments in the 4 provinces and 6 urban centres in the Mekong Delta have undoubtedly helped to extend the coverage of the drinking water supply service. This has
benefited 72,000 households – no small number! This first painstaking project has unfortunately not been renewed.
What have you gleaned from this first peer evaluation?
External evaluations are sometimes disappointing because the consultants often find it hard to identify the most relevant information and assess in detail AFD’s precise role
in the factors of success or failure. Peer evaluation is an easier way of undertaking this “self-criticism”. The exercise is fascinating! It does require substantial involvement but
it helps to improve the quality of the new projects I'm setting up. In some ways, it's the only chance a project manager gets to analyse a project from the identification stage through to completion.
