HCMC – The World Bank (WB) has signed an agreement to provide Vietnam with a credit of US$221.5 million to support the country’s economic recovery from the Covid-19 pandemic through policy reforms aimed at improving financial inclusion and spurring greater environmental resilience.
The US$221.5-million credit is a budget support operation and comes in concessional terms for 30 years with a grace period of five years. It encourages policy reforms under two pillars.
The first supports an inclusive economic recovery by easing the tax burden on businesses, improving access to financial assistance among vulnerable groups, reducing gender gaps at the workplace and promoting financial inclusion.
The second pillar contributes to greening trade policies, accelerating the adoption of e-government and increasing the uptake of renewable energy.
According to the WB, the Vietnamese Government has moved quickly in recent months on the implementation of these reforms. The approval of mobile money licenses and the roll-out of electronic invoice systems in the country’s largest municipalities are examples of this.
“The pace of reform is expected to accelerate as part of the recovery package to be discussed at the National Assembly next week,” the WB said.
The US$221.5-million credit is provided to Vietnam through the WB’s International Development Association, the bank’s concessional lending window for low-income countries.
“In the spirit of our long-term, trusted and productive partnership, we are proud to support Vietnam at a time when the economy is recovering from the biggest shock of the past decades and when so many uncertainties remain around the pandemic,” said World Bank Country Director for Vietnam Carolyn Turk.
“I believe that the range of policy actions supported by this operation will not only create a strong foundation for the immediate recovery from the Covid-19 crisis but also benefit Vietnam in the longer run.”