Provision of Yen Loan to Viet Nam (Advance Notification)
November 10, 2017
1. On November 10 (same day local time), there was an advance notification for the provision of a yen loan for the Ha Nam Investment Climate Improvement Project and another project (loan provision of up to 29.973 billion yen in total) at the Japan-Viet Nam Summit Meeting held in Da Nang in the Socialist Republic of Viet Nam. Based on this pledge, the Government of Japan and the Government of Viet Nam are scheduled to sign an exchange of notes concerning the yen loan in the future.
(1) Financing for development of roads and drainage systems in industrial park areas located in the south of Hanoi (Yen loan, Ha Nam Investment Climate Improvement Project, up to 18.082 billion yen)
The Government of Japan will finance capitals to the Government of Viet Nam for their development of roads and drainage facility systems in industrial park areas, medical areas, and urban areas in Ha Nam Province, approximately 40 km south of the capital city of Hanoi. This will enable transportation of an average of 111,000 vehicles per day, and the sewage treatment environment will improve for approximately 24,000 people. By improving the investment environment in the province, including the living and working environment, economic growth will be promoted through fostering of supporting industries and facilitation of foreign investment, which will be beneficial for Japanese companies moving into the industrial parks.
(2) Financing for development of the drainage system of Ha Long City, which contains a World Natural Heritage Site (Yen loan, Ha Long City Water Environment Improvement Project, up to 11.891 billion yen)
The Government of Japan will finance capitals to the Government of Viet Nam for their development of the drainage system in Ha Long City, Quang Ninh Province in northern Viet Nam. Through this project, the sewage treatment environment will be improved for approximately 255,000 people. By supporting the enhancement of the city’s capability for sewage treatment, it is expected to contribute to improvement of the sanitary environment of the city, and preservation of the water quality of Ha Long Bay, a World Natural Heritage Site.
3. Loan terms
(1) : Drainage system portion of (1) in 2. above, and (2) in 2. above
(1) Target project : 0.3% per annum (0.01% per annum for consulting services) (ⅱ) Repayment period : 30 years after the grace period of 10 years (ⅲ) Procurement terms : General untied
(2) Target project: Items besides the drainage system portion of (1) in 2. above
(1) Rate of Interest : 1.4% per annum (ⅱ) Repayment period : 20 years after the grace period of 10 years (ⅲ) Procurement terms : General untied
These two projects are part of the 750 billion yen of support to the Mekong region over the next three years announced by Mr. Shinzo Abe, Prime Minister of Japan, at the Seventh Mekong-Japan Summit Meeting in July 2015.
[Reference] Japan-Viet Nam Relations (Basic Data)
The Socialist Republic of Viet Nam covers an area of approximately 329,241 square kilometers (roughly the size of Japan if Kyushu is excluded). It has a population of approximately 92.7 million (Viet Nam national census, 2016) and a gross national income (GNI) per capita of 1,980 U.S. dollars (World Bank, 2016).