Document of the International Development Association acting as Administrator of the Interim Trust Fund FOR OFFICIAL USE ONLY Report No. P-7066-VN MEMORANDUM AND RECOMMFNDATION OF THE MANAGING DIRECTOR TO THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION ON A PROPOSED INTERIM FUND CREDIT IN AN AMOUNT OF SDR 71.3 MILLION TO THE SOCIALIST REPUBLIC o VIETNAM FOR A WATER SUPPLY PROJECT May 20, 1997 Infrastructure Operations Division Country Department I East Asia and Pacific Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENT (As of July 15, 1996) Currency Unit = Vietnamese Dong (VND) VND 1,000 = US$0.091 US$1.00 = VND 11,000 WEIGHTS AND MEASURES 1 centimeter (cm) = 0.394 inches 1 meter (m) = 39.37 inches 1 kilometer (km) = 1,000 meters or 0.62 miles 1 square kilometer (km2) = 0.38 square miles 1 hectare (ha) = 10,000 square meters or 2.47 acres 1 cubic meter (m3) 1,000 liters or 264 US gallons 1 liter/capita/day (lcd) = 0.26 US gallons per capita per day 1 metric ton (t) 1,000 kilograms or 2,205 pounds ABBREVIATIONS AND ACRONYMS Government = Government of the Socialist Republic of Vietnam HCMC = Ho Chi Minh City ITF = Interim Trust Fund MOC = Ministry of Construction NRW = Non-revenue water PC = People's Committee WHO = World Health Organization WSC = Water Supply Company RAP = Resettlement Action Plan FISCAL YEAR January 1 to December 31 Vice President: Mr. Jean-Michel Severino, EAP Director: Mr. Javad Khalilzadeh-Shirazi, EAl Division Chief: Mr. J. Shivakumar, EAllN Task Manager: Mr. Anjum Altaf, EAllN FOR OFFICIAL USE ONLY VIETNAM WATER SUPPLY PROJECT Credit and Project Summary Borrower: Socialist Republic of Vietnam. Implementing Hanoi Water Business Company and Haiphong, Quang Ninh, and Agencies: Danang Water Supply Companies. Beneficiaries: Hanoi Water Business Company and Haiphong, Quang Ninh and Danang Water Supply Companies. Poverty: Not applicable. Amount: SDR 71.3 million (US$98.61 million equivalent). Terms: IDA standard terms with 40 years' maturity, including 10 years of grace. Commitment Fee: 0.50% on undisbursed credit balances, beginning 60 days after signing, less any waiver. Onlending Terms: The Credit would be onlent in VND to Hanoi Water Business Company (US$32.51 million), Haiphong Water Supply Company (US$19.66 million), Quang Ninh Water Supply Company (US$12.62 million) and Danang Water Supply Company (US$33. 82 million) at a fixed interest rate of 6.5% per annum, with repayment over 20 years, including a grace period on principal and interest of five years. Foreign exchange risks would be borne by the Government. Financing Plan: See Schedule A. Net Present Value: US$34 million at 10% discount rate on total project cost excluding price contingencies, taxes and duties. Staff Appraisal Report: No. 16299. Maps: IDA Nos. 28592 through 28955. Project ID: 4830. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  MEMORANDUM AND RECOMMENDATION OF THE MANAGING DIRECTOR TO THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association acting as Administrator of the Interim Trust Fund) ON A PROPOSED INTERIM FUND CREDIT TO THE SOCIALIST REPUBLIC OF VIETNAM FOR A WATER SUPPLY PROJECT 1. I submit for your approval the following memorandum and recommendation on a proposed Interim Fund Credit to the Socialist Republic of Vietnam (Vietnam) for SDR 71.3 million, the equivalent of US$98.61 million, on standard IDA terms, with a maturity of 40 years including 10 years of grace, to help finance a Water Supply Project. The proceeds of the credit would be onlent by the Government to Hanoi, Haiphong, Quang Ninh and Danang Water Supply Companies at a fixed interest rate of 6.5 percent per annum with repayment over 20 years, including a grace period on principal and interest of five years. 2. Background. Severely constrained resources during the years of conflict in Vietnam have affected the quality of construction, maintenance and coverage of all infrastructure including water supply. At present, only 7.5 million people (47% of the urban population) have access to piped water. By and large, the quality of water supplied is not in compliance with WHO or Government water quality standards. Non- revenue water (NRW) is often as much as 50 percent of water produced. Shortage of water and intermittent supply between 6 to 12 hours per day are common. Water treatment plants have suffered from lack of maintenance. Many plants, even those recently built, have design and construction faults while some urban centers have no treatment facilities at all. 3. The water supply sector has shared in the Government's plans to improve infrastructure. A UNDP/World Bank sector study was completed in 1990 with help from the French government and a National Water Supply Strategy was completed in 1994 with Finnish assistance. Following the recommendation of these studies, the Government has adopted a two-stage strategy. The first stage, up to about the year 2000, would focus on rehabilitation of existing infrastructure and implementation of emergency works in 53 provincial towns throughout the country; the second stage would focus on capacity expansion. Coverage is planned for 80 percent of consumers based on modest service levels defined in the national strategy. 4. Based on this strategy, a number of sector investments have been approved. These include ADB-financed investments in Ho Chi Minh City (HCMC) and six provincial towns and rehabilitation in Hanoi and Haiphong financed by the Government of Finland. Governments of Australia, Denmark, Germany, Japan, Sweden and others are financing improvements of water supplies in a number of secondary urban centers. IDA has been requested to finance system rehabilitation in four major cities (Hanoi, Haiphong, Halong City and Danang), continuing in the first two cities the Finnish program which is approaching its planned completion. Externally supported development investments in the water supply and sanitation sector are approaching US$ 1 billion. In addition, the Government is encouraging private sector participation through BOT projects for bulk water supplies primarily for industrial estates. One BOT has been approved in HCMC and another is under consideration in Hanoi. 5. The Ministry of Construction (MOC) is the main national agency responsible for 2 sector policies, planning and regulation; with the exception of major cities, it also assists in the implementation of water supply systems. Provincial People's Committees (PCs) through the Urban Works Departments are primarily responsible for overseeing the provincial Water Supply Companies (WSCs) which construct, operate and maintain urban water supply systems, and for approving tariff levels. 6. Prior to the implementation of the Enterprise Reform Program, State Enterprises operated with non-commercial objectives. In terms of financial objectives, WSCs were required to set tariffs to meet operating costs (including depreciation), taxes and a regulated profit percentage defined as up to 5% of operating costs. Nevertheless, tariffs in general have not yet been set at levels to properly maintain assets and until 1994, depreciation charges were being transferred back to the PCs. Because of the priority to meet tax and depreciation payments, the amount spent on repairs and maintenance was not sufficient with the systems gradually deteriorating. Under the reform program, the Government has committed to the progressive commercialization of the WSCs while attempting to meet social obligations related to the provision of safe water. Guidelines for appropriate tariff design have been provided by a National Water Tariff Study financed by the ADB and completed in March 1996. 7. Project Objectives. The project's objectives are to: (a) improve the quality of water supply services in Hanoi, Haiphong, Quang Ninh and Danang through renovation of existing facilities in order to satisfy demand up to 2000 of about 2.5 million people in the cities; (b) ensure sustainability of the physical investments by developing the institutional capabilities of water supply agencies, facilitating their commercialization, and upgrading their staff skills through training; and (c) assist in preparation of a future investment program to satisfy water demand after 2000. 8. Description. The project would serve Hanoi, Haiphong, Danang and Halong City/Cam Pha. In each city, the project would improve water supply by rehabilitating treatment plants and distribution networks and providing additional water to satisfy demand for about 75% of the population in year 2000. Technical assistance to the four WSCs would be provided to help in (a) commercialization through improved billing, collection and customer management; (b) introduction of incentive systems to improve performance; (c) training for technical, administrative and management staff; and (d) construction management. The project is expected to cost US$143 million, of which US$74 million would be foreign exchange. 9. Financing. The proposed credit would be funded from the Interim Trust Fund (ITF) administered by IDA and subject to special provisions regarding procurement. The credit of SDR 71.3 million (US$98.61 million equivalent) would finance 69% of project costs net of duties and taxes. Bilateral sources would finance US$18 million (13%), mainly in the form of grants for technical assistance. The remaining US$26 million (18%) would be financed locally. The estimated costs and the financing plan are shown in Schedule A. Amounts and methods of procurement and the disbursement schedule are shown in Schedule B. A timetable of key project processing events and the status of Bank Group operations in Vietnam are presented in Schedules C and D, respectively. Data on Vietnam at a glance are included in Schedule E. Maps showing the roject area are attached. The Staff Appraisal Report, No. 16299-VN, dated, May 20, 1997 is being distributed separately. 3 10. Implementation. The project would be implemented by the four WSCs which would employ contractors to supply equipment and construct the proposed facilities. Each WSC has established a component implementation unit assisted by contract management consultants. Together with PCs, the WSCs would establish component implementation committees to help the WSC facilitate administrative actions. Four major civil works contracts, one for each city, that comprise the bulk of procurement (US$111 million) would include supply and installation of equipment and would be procured under ,International Competitive Bidding'. ICB procedures would also be used to procure most of the vehicles and equipment (US$2.09 million). Locally manufactured goods procured under ICB would be granted a preference of 15%, or the amount of custom duties, whichever is lower. Equipment worth US$0.9 million would be procured by shopping. Project implementation would extend over four and a half years, and the closing date would be December 31, 2002. 11. Monitoring and Evaluation. Annual performance agreements between the PCs and the WSCs linked to staff compensation, and public performance audits are proposed to be used to evaluate WSC operations, to increase accountability, to strengthen management incentives, and to make comparative WSC information available to the public to make benchmarking competition an effective tool for improving performance. In addition, key performance indicators focused on reduction of non-revenue water, increase in service coverage and improvement of financial working ratios, would be monitored in regular progress reports to be used for project supervision. A mid-term review would take place in June 1999. 12. Sustainability. Financial sustainability depends upon the appropriate mix between investment levels, onlending terms, Government equity support and tariff levels. Agreement has been reached on a package that places a sustainable burden on the presently weak WSCs. Institutionally, sustaining the necessary revenue streams would depend upon application of commercial billing and collection procedures, reducing NRW, introducing performance enhancing incentives and appropriate training. These have been included as part of Technical Assistance to the project. Cooperation with international private water system operators is included to transfer best practices to the WSCs. In collaboration with the Vietnam Association of Water Supply Companies and EDI, a workshop is being arranged to transfer global experience in the commercial operation of water supply companies in a market economy. 13. Lessons from Previous IDA Prolects. This would be the first IDA-financed project in the water supply sector in Vietnam. However, lessons from other projects in Vietnam and the Bank's global experience in the sector are incorporated in the project design. One key lesson is that both borrowers and lenders should minimize using sector projects to achieve subsidiary social objectives. Such objectives can be achieved more effectively and at lower cost through targeted instruments and interventions. Lessons from the implementation experience of the ADB-financed water supply project in HCMC, pertaining, in particular, to the design of procurement packages, are also incorporated in the project. These reinforce the need to keep the project simple, compatible with the implementation capacity of the WSCs, and cognizant of the multiple approval requirements in Vietnam. 1 Limited to ITF Participating Countries. 4 14. Rationale for IDA Involvement. IDA's Country Assistance Strategy (CAS discussed by the Board on October 25, 1995 and updated in October 1996) clearly identifies the poor state of basic infrastructure as a key constraint to economic growth, and it delineates a lending pipeline directed at the creation and maintenance of infrastructure. IDA's general strategy concerning infrastructure is to begin with quick-return rehabilitation projects and then move to construction of new capacity to meet projected demand. The proposed project follows this strategy. Private capital, while interested in BOTs for bulk water production, is not yet available for rehabilitation and operation of distribution systems which the Government has decided to maintain as State Enterprises for the near future. The proposed project would enable the WSCs to reach a level of performance where participation would become attractive for the private sector. 15. The project is an integral part of Vietnam's urban development strategy based on the priority development of three key economic regions (the Hanoi-Haiphong-Halong triangle in the north, the Danang economic zone in the center, and the HCMC-Vung Tau corridor in the south). All infrastructure, including water supply and sanitation, in these key regions is being upgraded to attract industry, commerce and tourism. For water supply investments, IDA has been requested to provide assistance in the first two regions while ADB is financing investments in the third. 16. Actions agreed. At negotiations, the Government and WSCs confirmed: (a) the onlending terms for the credit; and (b) the financing plans for each project component. WSCs also confirmed: (a) adherence to environmental action plans; (b) adherence to action plan regarding obligations pertaining to households resettled from the Cao Van dam in Quang Ninh province; and (c) the content of periodic reports. During negotiations assurances were obtained from the Government that it would: (a) provide, through PCs, local funds as required by WSCs for carrying out their parts of the project; (b) through PCs, take all actions to enable the WSCs to implement the project and comply with their obligations; (c) through PCs, take necessary actions, including adjustment of water tariffs, to achieve required financial objectives of Hanoi WBC and Haiphong, Danang and Quang Ninh WSCs; and (d) maintain the Statement of Expenditures and the special accounts for the ITF credit, and that audit reports, which would include separate opinions on these Statements, would be prepared by firms acceptable to IDA and submitted to IDA within nine months of the close of each fiscal year. Assurances were also obtained from the WSCs that: (a) the WSCs would submit to IDA each year, beginning October 30, 1997, annual plans for institutional assistance and training; (b) the WSCs would implement their respective RAPs and would arrange for (i) semiannual progress reports on WSCs' supervision and monitoring of resettlement activities; (ii) starting from December 31, 1997, an independent semi-annual monitoring of RAPs' implementation; and (iii) final report on completion of each RAP; IDA approval of a detailed RAP in respect of each distribution network site would be required prior to commencement of work on that part of the project. These would be prepared by WSCs and approved by PCs; (c) the Quang Ninh WSC would furaish by December 31, 1997, proposed arrangements for periodic inspections of the Cao Van dam and that it would implement recommendations of such inspections thereafter; (d) the annual financial statements of the Hanoi WBC and Haiphong, Quang Ninh, and Danang WSCs would be audited by firms acceptable to IDA and submitted to IDA within nine months of the close of each fiscal year; (e) Hanoi and Haiphong WSCs would take necessary measures including adjusting the structure or level of tariffs, to ensure they recover operating costs in full as well as maintain a debt service coverage ratio of at least 1.2, and a self-financing 5 ratio of at least 3% beginning in FY98, and 20% in FY02; (f) Quang Ninh and Danang WSCs would take necessary measures including adjusting the structure or level of tariffs, to maintain for each of their fiscal years a ratio of total expenses to total operating revenues not higher than 100% in FY98, 85% beginning in FY02, and 65% in FY05; and (g) the WSCs would provide IDA on June 30 and December 31, beginning in 1998, with semiannual progress reports including revised project cost estimates and implementing schedules, and annual updated financial projections which would be submitted no later than September 30 of each project year, beginning in 1998. 17. The execution of Australian, Danish and Finnish Grant Agreements and Danish Trust Fund Agreement and establishment of Resettlement Committees by each of the PCs pursuant to the provisions of the RAPs are conditions of effectiveness, and execution of subsidiary loan agreements between the Government and Hanoi WBC, and Haiphong, Quang Ninh and Danang WSCs, and employment of construction management consultants acceptable to IDA are conditions of disbursement of the ITF credit related to the relevant part of the project. Full disbursement of the proceeds of the Danish Trust Fund is a condition of disbursement of the ITF credit earmarked for the respective project component. Compliance with the obligation to provide some additional assets (land and electrical connections) to households resettled in Gia Lai province from Quang Ninh province is a condition of disbursement of the proceeds of the credit earmarked to finance the Quang Ninh WSC project components. 18. Environmental Aspects. The project is allocated an environmental category B. Water supply improvements would be located mainly within existing WSC plants and rights-of-way and the environmental impacts essentially occurring during construction would be small in scale, reversible, and with minor resettlement. Three cities, Hanoi, Haiphong and Danang, would increase the use of existing allocated water sources remaining within the limits of sustainable yields. The fourth component, Quang Ninh, would use water from a dam designed to provide water to Halong City and Cam Pha, currently nearing completion. Studies to confirm safety of the dam, protect water sources and identify ways for reducing non-revenue water are being financed under the project. 19. Because of existing incomplete coverage in each city, the increased piped water supply would displace water presently being obtained from non-piped sources by households without access to the piped system or those not receiving their full requirement from the system. Thus, there will be no net addition to the total water consumed in the cities. A proposed second water supply project would significantly increase water production. However, before such expansion the Sanitation Project presently under preparation in the same cities with IDA assistance would upgrade the sewerage and drainage networks and management of wastewater. 20. Program Obiective Catecories. The project's key objective is to improve urban water supply services. There is no explicit poverty targeting although the project should help improve access to safe water for those currently using non-piped sources and paying high rates to buy from vendors. Subsidies currently provided to the WSCs could, after successful commercialization of the utilities, be more beneficially re- allocated at the discretion of the Government. 21. Benefits,. The proposed project would (a) improve access to acceptable quality water for 2.5 million urban residents in four major cities; (b) improve service 6 levels and reliability thereby reducing private expenditures on self-provisioning of residential and industrial consumers; (c) facilitate development of cities as industrial and/or tourist centers in identified growth zones; (d) facilitate the commercialization of WSCs; and (e) help the WSCs plan capital investments necessary for the future. 22. Risks. The major risk to the project relates to the Government's ability to enforce and the provinces' capacity to implement the new economic and sectoral policies. Although credible commitments of adequate financial support have been made at all relevant levels and infrastructure development in the key economic regions in which the project cities fall is of high national priority, it would be a challenge for the WSCs to adapt to the cost-recovery requirements of commercial operation. Significant and continuous technical assistance and collaboration with international water operators and EDI is provided to help the WSCs through the period of transition. As this is the first operation in the sector, it is inevitable that some issues will only emerge and be resolved during the process of project implementation. In Vietnam, in general, project needs pertaining to procurement, audits, environmental clearances, onlending, etc. are continually raising previously unfamiliar issues that require consideration and decisions at the national level. The project is also susceptible to delays due to higher than usual coordination problems resulting from dependence on different donors for preparation activities in the four cities and the decentralization of sector responsibilities to provinces resulting in the absence of a national coordinating counterpart agency. Substantial assistance from the Bank's Resident Mission has been built into the project cycle to mitigate this risk. 23. Recommendation. I am satisfied that the proposed Interim Trust Fund Credit would comply with Resolution No. 184, adopted by the Board of Governors of the Association on June 26, 1996, establishing the Interim Trust Fund and I recommend that the President approve it. Gautam S. Kaji Managing Director Washington D.C. May 20, 1997 Attachments 7 Schedule A VIETNAM WATER SUPPLY PROJECT Estimated Cost and Financing Plan (US$ Million) Cost Estimate Component Local Foreign Total % of Total Water sources 3.78 5.41 9.19 8 Treatment plants 11.45 10.64 22.10 19 Distribution 26.84 38.63 65.48 56 Project support 5.77 10.07 15.85 13 Land 5.20 0.00 5.20 4 Base cost 53.06 64.76 117.82 100 Physical contingencies 2.65 3.24 5.89 S Price contingencies 13.04 5.91 18.94 16 TOTAL COST a/ 68.75 73.91 142.66 121 a/ Includes taxes and duties estimated at US$14.4 million Financing Plan Financing source Local Foreign Total % of Total IDA (ITF) Credit 36.16 62.45 98.61 69 Finnish grant aL tL 1.90 1.99 3.89 3 Danish grant to QN WSC _a 1.85 2.85 4.70 3 Danish Trust Fund c/ dL 1.83 3.17 5.00 4 Danish grant to GOV h 4 0.51 2.55 3.06 2 Australian grant a/ h 0.43 0.90 1.33 1 Provinces'/WSCs' contribution 26.07 0.00 26.07 18 Total Financing 68.75 73.91 142.66 100 gaZ The amounts exclude financing provided for project preparation. b/ Administered by Finland, Denmark and Australia. c/ Administered by IDA. d/ Onlending terms identical to IDA credit. 8 Schedule B Page 1 VIETNAM WATER SUPPLY PROJECT Procurement Arrangements a/ (US$ million) Project Element Procurement Method NIF :L Total Costs ICB NCB Other Civil works d/ 111.33 3.06 eL 114.39 (91.71) (0.00) (91.71) Equipment 2.09 0.89 CL 2.98 (2.09) (0.58) (2.67) Implementation support 9.23 IL 9.90 19.13 (9.23) (0.00) (9.23) Land acquisition 6.15 6.15 - -(0.00) (0.00) Total 113.42 10.12 19.11 142.65 (93.80) (9.81) (0.00) (103.61) Amounts in parentheses are to be knanced by Ir anda Trust Fund Grant of US$5.0 million administered by IDA aL Includes contingencies b/ Not IDA (ITF)-financed c/ National shopping d/ Single responsibility contracts to supply and install; comprising civil works of about US$48.03 million equivalent e Denmark-financed water connections in Quang Ninh f/ Consultant services 9 Schedule B Page 2 VIETAM WATER SUPPLY PROJECT Initial Allocation of Credit and Danish Trust Fund Proceeds aL (US$ MILLION) Category Amount % Expenditure to be financed from of IDA (ITF) Credit 1. Supply and install contracts 91.71 85% of total expenditures 2. Equipment and materials 2.67 100% of foreign expenditures, 100% of local expenditures (ex- factory cost) and 65% of local expenditures for other items procured locally 3. Consultant services for 9.23 100% of total expenditures construction management TOTAL 103.61 n/a Estimated Disbursement a/ (US$ Million) IDA Fiscal Year 1998 1999 2000 2001 2002 2003 Annual disbursements 13.0 26.0 27.0 21.0 14.2 2.4 Cumulative disbursements 13.0 39.0 66.0 87.0 101.2 103.6 a/ Including Danish grant of US$5.0 million administered by IDA. 10 Schedule C VIETNAM WATER SUPPLY PROJECT Timetable of Key Project Processing Events a) Project preparation: 20 months b) Prepared by: Hanoi, Haiphong, Quang Ninh and Danang Water Supply Companies assisted by consultants under Finnish, Danish and Australian financing. c) First IDA mission: October 1994 d) Appraisal mission: July 1996 e) Negotiations: April 1997 f) Planned date of effectiveness: September 1997 g) List of relevant ICRs and PPARs: None This report is based on the findings of a mission which visited Vietnam in June/July 1996. Task Team members included Mmes./Messrs. Anjum Altaf (Team Leader), Carlos Escudero (Sr. Counsel), Jack Fritz (Environmental Engineer), Maninder Gill (Resettlement Specialist), Hiroyuki Hayashi (Research Assistant), Hilary Kiell (Procurement Analyst), Jaroslav Kozel (Sanitary Engineer), John Nicholson (Financial Analyst), Thanh Nguyen Cong (Sanitary Engineer), and Manida Unkulvasapaul (Environmental Specialist) . Peer reviewers were Messrs. Edouard Motte (Senior Sanitary Engineer, EA2EM) and Raja Iyer (Principal Management Specialist, EA3IN). Peer advisers were Mmes./Messrs. Penelope Brook Cowen (PSD), Alexander Bakalian (LAlIU) and Robert Roche (AFTU1). The report was edited by Ms. Barbara Koeppel and task support was provided by Ms. Martha Ochieng. The Division Chief is Mr. J. Shivakumar (EAlIN) and the Director is Mr. Javad Khalilzadeh-Shirazi (EAIDR). Schedule D 11 Page 1 of 2 STATUS OF BANK GROUP OPERATIONS IN VIETNAM A. STATEMENT OF BANK LOANS AND IDA CREDITS Ja (As of March 31, 1997) Amount (US$ million)& Loan or fles cancellations) Credit Fiscal Number Year Borrower Purpose IDA& Undisbursed Two Credits closed. 209.70 0.0 of which SAL's, SECALS and Program Loans 2657 1995 Vietnam SAC 1 ,Q5Q 2548 1994 Vietnam Primary Education 70.00 56.90 2549 1994 Vietnam Highway Rehabilitation 158.50 123.16 2561 1994 Vietnam Agriculture Rehabilitation 96.00 14.03 2711 1995 Vietnam Irrigation Rehabilitation 100.00 80.76 2724 1995 Vietnam Power Sector Rehabilitation 165.00 146.37 2785 1996 Vietnam Payment System & Bank Modernization 49.00 45.51 2807 1996 Vietnam Population & Family Health 50.00 45.71 2808 1996 Vietnam National Health Support 101.20 92.62 2820 1996 Vietnam Power Development 180.00 70.88 2855 1996 Vietnam Rural Finance 122.00 114.39 2929 1997 Vietnam Rural Transport 55.00 52.28 CN0130* 1997 Vietnam Highway Rehabilitation II 195.60 195.60 Total 1,552.00 1,03821 of which has been repaid 5.07 Total Now Held By Bank and IDA Amount sold 0.00 Total Undisbursed La The status of the projects listed in Part A is described in a separate report on aH IBRD/IDA-financed projects in execution, which is updated twice yearly and circulated to the Executive Directors on April 30 and October 31. & Principal amounts in USS equivalent at date of negotiations, and undlabursed amounts in US$ equivalent are valued at exchange rate applicable on the date of this statement. Not yet effective. Total Approved, Repayments, and Outstanding balance represent both active and inactive Loans and Credits. 12 Schedule Page 2 of 2 Vietnam - Statement of IFC Investments Committed and Disbursed Portfolio As of March 31, 1997 (In US Dollar Millions) Committed Disbursed IFC IFC I I II FYApprmval Company Loan Equity Qu-i Paric Loan Equity Quasi Partic 1994 Hanoi Metropole 4.67 0.00 3.50 16.15 4.67 0.00 3.50 16.15 1995 Baria Serece Pt 3.00 0.00 0.00 2.00 3.00 0.00 0.00 2.00 1995 Foremost Dairy 8.00 0.00 0.00 6.50 8.00 0.00 0.00 6.50 1996 Kyoci Steel 15.00 0.00 0.00 0.00 1500 0.00 0.00 0.00 1996 Morn.Star Cement 30.00 0.00 0.00 66.60 16.50 0.00 0.00 36.63 1996 Sucre de Bourbon 22.00 0.00 0.00 20.00 0.00 0.00 0.00 0.00 1996 SMH Glass Co. 10.00 0.00 0.00 4.50 0.00 0.00 0.00 0.00 1996 Tosac Hotel 3.39 0.00 0.00 2.78 0.00 0.00 0.00 0.00 1996 Tourane Hotel 6.00 0.00 2.30 6.00 0.00 0.00 0.00 0.00 1996 Vimaflour 8.00 0.00 0.00 3.00 5.09 0.00 0.00 0.00 1996 VILC 0.00 0.75 0.00 0.00 0.00 0.75 0.00 0.00 Total Portfolio: 110.06 0.75 5.80 127.53 52.26 0.75 3.50 61.28 Approvals Pending Commitment Loan Equity Quasi Parfic 1996 VIETNAM INTL LSE 5.00 0.00 0.00 10.00 1997 KIA HUY HOANG 6.20 0.62 0.80 6.20 1997 SEM HOTEL 13.00 0.00 4.50 30.00 1997 VINAFOOD 10.50 0.00 0.00 13.50 Total Pending Commitme 34.70 0,62 5.30 59.70 13 Vietnam at a glance POVERTY and SOCIAL Eat Low- Vietnam Asia Income Development diamond* Population mid-1995 (mllions) 73.5 1,709 3,188 GNP per capita 1995 (USS) 250 840 460 Life expectancy GNP 1995 (bilons USS) 20.3 1,436 1,466 Average annual growth, 1990-98 Population (%) 2.1 1.3 1.8 Labor force (%) 2.1 1.4 1.9 GNP Gros per primar Most recent estimate (latest year available since 1989) capita enrollmen Poverty: headoount Index (% of populaion) 51 Urban population (% of total population) 21 32 28 Life expectancy at birth (years) 67 68 63 Infant mortality (per 1,000 live births) 44 35 66 Child mainutrition (% of children under 5) 45 17 38 Access to safe water Access to sae water (% of populaion) .. 67 66 Illiteracy (% of populatdon age 15+) 12 16 35 Gross primary enrollment (% ofschool-age population) 111 116 105 -Vietnam Male 101 119 112 -Low-income group Female 103 115 98 KEY ECONOMIC RATIOS and LONG-TERM TRENDS 1976 1988 1914 1195 Economic ratos* GDP (blillons USS) .. .. 15.5 20.3 Gross domestic investment/GDP .. .. 25.5 27.1 Openness of economy Exports of goods and non-factor services/GDP .. .. 34.4 35.9 Gross domestic savings/GDP .. Gross national savings/GDP .. .. 16.9 17.1 Current account balancelGDP .. -2.8 -8.6 -10.0 Savings Investment Interest payments/GDP .. 0.0 0.5 Total debWGDP .. 0.4 161.3 Total debt servilceexports .. .. .. 13.5 Present value of debtJGDP .. .. 152.2 Present value of debtlexports .. .. 462.0 .. Indebtedness 1975-84 198-95 1914 1995 1911-04 (average annual growth) - Vietnam GDP .. 6.5 8.8 9.5 9.5 Low-income group GNP per capita .. 3.8 6.4 Exports of goods and nfs .. .. 30.7 36.9 27.1 STRUCTURE of the ECONOMY (% of GDP) 1978 1985 19s4 195 Growth rate of output and lnvestmnt(%) Agriculture .. .. 27.7 27.5 0 Industry . .. 30.7 20.1 2 Manufacturing . .. 22.0 . Services .. .. 41.6 43.4 91 92 93 94 90 Private consumption .. .. .. .. 2 General government consumption .. .. 9.1 .. Imports of goods and non-factor services .. .. 42.0 46.7 GDI -*-GOP (average annual growth) 197584 1985-95 199 1991 Growth rates of exports and Imports (%) Agriculture .. 4.7 3.9 4.7 7s Industry .. 11.8 13.6 13.9 Manufacturing .. .. 12.9 Services .. 8.8 10.2 10.9 25~ Private consumption .. .. . General government consumption . . . . 92 93 94 95 Gross domestic investment . 24.2 15.7 22.0 .I Imports of goods and non-factor services .. .. 54.2 41.2 Gross national product .. 6.2 0.8 9.5 -- p Note: 1995 data ae preliminary estimates. Figures in Italics ae for years other than those specified. - The diamonds show four key Indicators in the country (in bold) compared with its income-group average. If date are missing, the diamond will be incomplete. 14 Vietnam P R I C E S a n d G O V E R N M E N T F I N A N C E _ __ls s 1 9 4_9_In l t o n 1 % 1976 1985 1994 1005 InladIon(% Domestic PricesloT (1% change) ' Consumer prices .. 9.3 16.8 75 Implicit GDP deflator 94.2 14.5 19.5 so Govemment toenoe 29 (% of GDP) I_ _ _ _ Current revenue .. .. 24.4 23.9 0 01 92 93 B o5 Current budget balance 5.0 5.2-GDPda -*-CP Overall surplus/deficit .. .. -1.6 -0.5 -GDPder. ***-CPI TRADE 1978 1985 1994 19o5 Export and Import levels (mill. US$) (miltiona USS) Total exports (fob) .. 507 4.054 5,198 Rice 425 549 Fuel 866 1.024 G.Co Manufactures Total Imports (cir) 930 5,508 7,543 Food 101 Fuel and energy 799 2.0o Capital goods Export price Index (1987-100) Import pricr Index (1987*100) .. sim3 9 9s Terms of trade (1987.100) .Exports almports BALANCE of PAYMENTS 1975 1006 1004 1095 Current account balance to GDP ratio (%) (millions US$)o Exports of goods and non-factor services .. .. 5,337 7.272 o o L2 .s a imports of goods and non-factor services .. .. 6.510 9.459 Resource balance .. -1,173 -2,187 Net factor Income -90 -337 -310 -4 Net current transfers .. 32 305 627 Current account balance, 4 before official transfers .. -473 -1.340 -2,020 Financing items (net) .. 204 1,832 2.489 Changes In net reserves .. 269 -292 -449 Memo: Reserves Including gold (ni. USS) 41 225 878 1,383 Conversion rate (local/USS) .. 8.3 10,935.0 11,000.0 EXTERNAL DEBT and RESOURCE FLOWS (m//lons USS) 1076 1986 194 1996 Composition of total debt. 19 ImIll. US$) Total debt outstanding and disbursed .. 61 25,115 IBRO .. 0 0 G D IDA .. 54 181 F 2607 282 50 Total debt service .. 2 300 IBRD .. 0 0 IDA .. 0 1 Composition of net resource flows Official grants 249 38 449 Official creditors .. 7 292 Private creditors .. 0 -111 Foreign direct Investment .. 100 E Portfolio equity .. 0 283 21047 Worid Bank program Commitments .. 0 246 A-.SBtD E - BItateral Disbursements .. 7 126 8- IDA D - Other multilateral F - Private Principal repayments .. 0 1 C-IF 0 - Short-tern Net flows .. 7 125 Interest payments .. 0 1 Net transfers .. 7 125 Intemational Economics Department/EA1CO 5/20/97 Note: Debt Includes non-convertible currency debt. IBRD 2859 VIETNAM -.-Th,s m-p -a, producd by the Map Niiigik Unit of The World B.nk.VITA - Th. n d-nination and any.th n h- WATER SUPPLY P ROJ ECT on hi, .pdo n,,ot i.ply, -n th. part of The World Bink Group, a-y udg, th. de-oot of any -ry.r any e-d--em.et HANOI cceprnce och b ondries WATER TREATMENT PLANTS: PROJECT EXISTING PIPELINES / DIAMETER (mm): PROJECT REHABILITATION C- o,,h UNDER CONSTRUCTION W.t.r TreatmenEXISTING - . EXISTING ROADS 0 2 '3 5 KILOMETERS Wg.er.w nm Plant CH IN A W.ater Tr,n L Mono'sNihh wtrTre,e~ n Haipcki g 4 20 PEOPLE'S ) x r02S593 ,g. Ti nL o DEMOC- IC 400T R EPU TFN '0 26595 00 0 T-ong i5 H. D, In 1000 War men a E0Nam D. Wate Tre- mn Plcknt - CAM BO0 A 60- MAY 1997  PRlOJECT å0s. 110ý HAIPHONG REGION CH°NNHRAWWATERINTAKE CHN - ANDONG WATER TREATMENT PIANT CN Kim. TRANSMISSION PIPELINEf EXISTING o RAW WATER TAKES J~ __J_ WATER TREATMENT PLANTS inh Prnce BOOSTER PUMPING STATIONS Hi Ha v2o2594" MAIN TRANSMISSION PIPEUNES Baiph" Cu Hoa URBAN CENTER LAO PEOPLE S vm ch MAIN ROADS DÉMOCRATIC _ cuocorn REPUBIC Y,T! QVIETN VM (nhIo n r, r Por dktil,N se map belo. ' Ke An Co Ngy A MBO A Hev rh. ~P mapw by 6he Map Desig, Unit of The Word B-n Är on .ip d nop,h pro, of The Wld Bn& Grop, -y y .udgmn on~' theM9 leait,Il Oofly erriPoyor an o rseen or w...d. e 0 2 4 6 8 0 KILOMETERS Do Son r - los.-.l - S C Song Cua Com ý3 MAY CHAT - CVIEN VA11 m250 400 V MY CýAU TRE -, VIEN DANG LAM NM NH rk,' ~j wp P-ducd by oh, ChA b. ooA0, Tk9.,d,, ,4Il~k Thondores coor de ,Oin Iominahans DONG KHE °"o°'' p °°'I°*"°" - th~i, ~p do no imply, on he to, 1 NTR world ,o Goup.oI-kG-p, y idö LAMNVIET SHATPYO NG A KN 60 DNLGOHA \ DANG GANG VIETNAM NIEM NGHA WATER SUPPLY PROJECT DU HNG KENH HA H N - ONC G gAN DUJONG BINH G WATER TREATMENT PLANT 200 PIPELINESIDIAMETER (mm) 300 PROJECT 300 EXISTING EXISTING B PS. BIok Popiog 91. 1 400 IRAO PROJECT B.P5, CA fn EXISTING ROADS EXTENSION OF DISTRIBUTION NETWORK IN BLOCKS O 2 KILOMETERS (PHUONGS) - RW-- >CK IPHONG1 ROtINT)ARIFS  1BRD 2859 VIETNAM WATER SUPPLY PROJECT QUANG NINH PROVINCE BBa map -- prde by . Map o.,ie M;,oF BB. w.Arus. wT P WATER TREATMENT PLANTS , do , nyn p., o Th. Wad B-k Group, any NEW RESERVOIRS PIPEUNES / DIAMETER (mm H- NEW REHABIüTATION EXISTING ROADS CHINA -Guag N,ýi Prownc" -Rd-2892 Son Duon Co V-n Resrv- Ao PEOPLES 8R0 29593j DEMOCRATIC --9 MoDu REPU8tlC GW ETNA,~ N" tD. B-c Weir __________-- HCLongOng - 00Cm fordoZn see{ -- R 2 Q - .- - - CAMB C) l A C.,o I. Tan H. lom s7 ---i H. T. no no Ha Long BaY - Bai Tu Long Bay MAY 1997  俗   IMAGING Report No.: P 7066 VN Type: MOMD