23:30 (GMT +7) - Wednesday 19/12/2018

Vietnam Today

ADB loan to boost finance sector

Released at: 16:19, 05/12/2018

ADB loan to boost finance sector

Photo: Duc Anh

$100 million policy-based loan a medium to long-term partnership in Vietnam's finance sector.

by Linh San

The Asian Development Bank (ADB) has approved a $100 million policy-based loan to develop Vietnam’s finance sector, aiming to support long-term economic growth and tackle rising income inequality.

The Financial Sector Development and Inclusion Program represents a medium to long-term partnership in finance sector development between ADB and the government. The program is consistent with the government’s Socio-Economic Development Strategy, 2011-2020, and ADB’s Strategy 2030 in addressing remaining poverty and income inequality.

“Vietnam’s economic performance in recent years has been impressive but reforms remain incomplete, especially those related to the finance sector,” said Ms. Duong Nguyen, ADB Financial Sector Economist. “In addition, the limited financial inclusion could exacerbate rising income inequality and impact long-term sustainable economic growth. This program will support the government’s efforts to strengthen financial stability, develop domestic capital markets, and enhance financial inclusion.”

The program supports several government reforms to strengthen, deepen, and broaden the outreach of Vietnam’s formal finance sector. These include improvements in the legal and regulatory framework to resolve non-performing loans and restructure weak credit institutions, the creation of an enabling environment for money market and government bond market development, and policy measures to introduce a market-based approach to financial inclusion through microfinance and financial technology.

The ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 67 members, 48 of which are from the region. In 2017, ADB’s operations totaled $32.2 billion, including $11.9 billion in co-financing.

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