Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux

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1 Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Hotel Pullman - 27 mai 2014 Patrick J. Gilabert UNIDO Representative in Viet Nam

2 PLAN 1. UNIDO an introduction 2. Development Finance and Aid Assessment for Viet Nam Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Hotel Pullman - 27 mai 2014

3 PLAN 1. UNIDO an introduction 2. Development Finance and Aid Assessment for Viet Nam 3. The U N (with case Study: how to work with UNIDO Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Hotel Pullman - 27 mai O.D.A. for the 6 Development Banks

4 PLAN 1. UNIDO an introduction 2. Development Finance and Aid Assessment for Viet Nam 3. The U N (with case Study: how to work with UNIDO 4. O.D.A. for the 6 Development Banks Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Hotel Pullman - 27 mai 2014 Conclusion Viet Nam Medium Term Perspective

5 Inclusive and Sustainable Industrial Development Creating Shared Prosperity Safeguarding the Environment

6 Inclusive and Sustainable Industrial Development 1. UNIDO A BRIEF INTRODUCTION

7 Inclusive and Sustainable Industrial Development United Nations Industrial Development Organization PARTNER FOR PROSPERITY GROWTH WITH QUALITY UNIDO s headquarters are in Vienna, it was set up in 1966 and it is represented in 54 developing countries Part of the United Nations common system 172 Member States

8 Inclusive and Sustainable Industrial Development Key Facts UNIDO Headquarters Lead role within UN system on industrial development Constitutional mandate to promote sustainable industrial development in developing countries and countries in transition Li Yong UNIDO DG since 28 June 2013 Former China s Vice- Minister of Finance UNIDO is the only UN specialized agency promoting the creation of wealth and tackling poverty through industry/manufacturing 650 staff members, 172 Member States 163 offices around the world, incl. HQ in Vienna, Austria 3000 experts/year

9 Inclusive and Sustainable Industrial Development UNIDO is promoting inclusive and sustainable industrial development to harness the full potential of industry s contribution to the achievement of sustainable development, and lasting prosperity for all LI Yong, Director General, UNIDO

10 Inclusive and Sustainable Industrial Development ISID means that: Every country achieves a higher level of industrialization in their economies, and benefits from the globalization of markets for industrial goods and services No one is left behind in benefiting from industrial growth, and prosperity is shared among women and men in all countries Broader economic and social growth is supported within an environmentally sustainable framework The unique knowledge and resource of all relevant development actors are combined to maximize the development impact of ISID Through the above elements and with the committed global constituency, ISID has great potential of achieving the overarching goal of eradicating poverty within the next generation

11 Inclusive and Sustainable Industrial Development

12 Inclusive and Sustainable Industrial Development 3 inter-related thematic priorities Inclusive Industry Poverty reduction through productive activities (SME development) Competitive Industry Trade capacity Building (quality & standards) Green Industry Energy and Environment (resource efficiency)

13 Inclusive and Sustainable Industrial Development Key Facts UNIDO in Viet Nam Country office established more than 25 years Partnerships with Vietnamese Ministries and Agencies : MPI, MOIT, MONRE, MOH, MOST, MET, MARD, VCCI International partners : Austria, EU, Norway, Italy, Israel, Switzerland, GEF Part of the DaO/UN reform in Viet Nam One UN Plan , Green One UN House UNIDO programme : Green Industry Development for a Low Carbon Economy focus on (1) Industrial Competitiveness and (2) Energy Efficiency and Environment 29 M USD for 5 years, approximately 100 experts per year hired for technical cooperation projects

14 Inclusive and Sustainable Industrial Development

15 Creating Shared Prosperity Safeguarding the Environment Inclusive and Sustainable Industrial Development Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux 2. A Development Finance and Aid Assessment for Vietnam

16 A Development Finance and Aid Assessment for Vietnam In the period between the launch of its economic reforms in the 1980s and the onset of the global financial crisis in 2007, Vietnam was one of the most dynamic economies in the developing world. It sustained average growth rates above 7% over a 20-year period, quadrupling the size of the economy. Poverty rates fell by an average of 2.9 percentage points per year, from 58% to a low of 14.2% in By the mid-2000s, Vietnam was experiencing record inflows of external resources, in the form of both FDI and ODA, funding some of the highest rates of investment in the world. This enabled Vietnam to extend basic infrastructure and services to the majority of its population. However Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

17 ... From 2007, Vietnam suffered a slowdown in growth rates as a result of the global financial crisis. Unlike some other Asian countries, however, Vietnam s economic growth has not returned to the levels seen before There are widespread concerns that Vietnam may be reaching the limits of its existing growth model. The challenges of moving to a new growth model include: completing the economic transition, raising the quality of FDI, managing inequality, macroeconomic constraints. Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

18 Mapping Vietnam s development finance flows Sources of development finance that can be directly programmed by GoV: Public revenues trebled since 2006, to over 800 trillion dong or US$39 billion, but have declined by 9% in real terms since Government borrowing has grown by an average of 30% per year since Vietnam s indebtedness remains modest by international standards (proposed total debt limit of 65% of GDP). ODA rose sharply in 2009, as the major development banks increased their lending in response to the global financial crisis. These levels have been maintained, with annual disbursements close to $4 billion. ODA will decline gradually in the coming years and fall away more rapidly towards the end of the decade. With these flows, GoV has been able to increase its level of public expenditure by 2.5 times between 2006 and Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

19 Mapping Vietnam s development finance flows Outside of the public sector, the most important development finance flows are: Lending by Vietnam s banking sector increased fivefold between 2006 and 2012, while total credit grew from 39% of GDP in 2000 to 115% in Foreign direct investment has fluctuated significantly over the past decade, spiking in 2008 during Vietnam s real-estate boom and then flattening out in real terms. International NGOs are important development actors in Vietnam, providing around $300 million in assistance each year. Remittances from Vietnamese citizens abroad are over $8 billion per year, which is of approximately the same magnitude as FDI and twice the size of ODA. Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

20 Relative size of Vietnam s development finances in constant 2010 Sources: MoF; MPI; GSO Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

21 Mapping Vietnam s development finance flows Vietnam is also entering a new phase in its development cooperation. Over the past decade, it has been one of the top recipients of official development assistance (ODA) in the world, at over $3 billion in annual disbursements, with donors responding enthusiastically to Vietnam s impressive development record and its strong commitment to aid effectiveness. Yet other funding sources, including domestic revenues, public borrowing and foreign direct investment (FDI), have grown at an even faster rate, making ODA an increasingly minor part of the overall development finance picture. This raises the question of what role ODA will play in supporting Vietnam s transition to a new growth model. Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

22 Source: MPI data ODA commitments and disbursements, 1993 to 2012 (MPI) $9 bn $8 bn $7 bn $6 bn $5 bn $4 bn $3 bn Committed Signed Disbursed $2 bn $1 bn Vietnam top few recipients of ODA in the world, with $80 billion 1993 / Steady climb from $1 billion in 1997 to just over $2 billion in In 2008, surge in ODA as the major development banks (JICA, WB, AsDB) increased their lending to counter the effects of the global financial crisis. 4. These high levels of lending have since been maintained, with total disbursements in 2012 close to $4 billion. Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

23 Mapping Vietnam s development finance flows Net ODA disbursements to Viet Nam Source: OECD Aid Statistics The OECD also keeps aid statistics, collected directly from donors. ODA figures published by the OECD show even higher levels of disbursement in recent years, reaching $4.7 billion in The share of multilateral aid in the total has ranged between 30 and 40 percent. Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

24 Mapping Vietnam s development finance flows Despite achieving middle-income status in 2008, Vietnam s overall external assistance is not expected to decline until towards the end of the decade. Vietnam s ODA is dominated by three large development partners Japan (JICA), the World Bank and the Asian Development Bank which between them provide 80-90% of annual disbursements. These development partners have not signalled any intention to reduce their financing in the short term. Though commitments will decrease, the overhand of past undisbursed assistance will keep ODA high for some time. Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

25 ODA commitments 1993 to 2012 by sector (USD million) Sector Loans Grant s Total % Agriculture and poverty reduction 7,433 1,422 8, Energy and industry 11, , Transport and 15,950 telecommunication , Environment, water and sanitation and 6,673 1,172 7, urban development Education and training 1, , Health and social affairs 1,336 1,242 2, Other sectors (science, technology and capacity building) 7,062 1,550 8, Total 51,60 7 6,756 58, Source: MPI data Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

26 Mapping Vietnam s development finance flows Legal framework for ODA management and utilisation In 2013, a new Decree 38 on ODA Management and Utilisation was issued, to align the legal frameworks for ODA and debt management and to encourage stronger project management. Some of the provisions in the new Decree 38 are: the scope is extended to less concessional financial support; it allows the private sector access to ODA on the basis of mutual interest and risk sharing with GoV; a number of new priorities for ODA allocation are identified, including high-technology industries and the knowledge economy, trade and investment promotion and support for the implementation of National Target Programmes; Prime Ministerial approval is required for ODA loans, umbrella projects, projects with institutional and policy components and technical assistance over $1 million in value. Other projects may be approved by the executing agencies; it includes measures to facilitate regional and international projects; and it includes additional guidelines on the preparation of project documents. Most importantly, Decree 38 initiates a shift in approach towards project supervision. Its predecessor (Decree 131 of 2006) was focused on checking the compliance of aid projects and their documentation with formal legal requirements and monitoring the rate of implementation through indicators on disbursement and time elapsed. Decree 38 adds the requirement to collect and analyse data on project outcomes. This important shift indicates a welcome increase in the priority given by GoV to monitoring and evaluation. Source : More effective development finance for a middle-income Vietnam, A Development Finance and Aid Assessment for Vietnam, Consultation draft, Marcus Cox, Hanh Tran Thi, April 2014

27 Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux 3. U N

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31 MAIN UN CENTERS UN NEW YORK UN GENEVA UN VIENNA

32 The UN in Viet Nam

33 Delivering as One 6 mutually reinforcing pillars to avoid duplication improve coherence, coordination and complementarity, reduce transaction costs and help UN agencies work more effectively together. Potential to be a transformational business model even greater efficiency and effectiveness sharper focus on achieving results

34 One Plan Key Features Based on National Goals in SEDP Signed on 27 March 2012 by Government of Viet Nam and 17 UN Agencies Marks 2nd generation of DaO with sharper focus on results One Plan Results Matrix and One Plan Database Aims to promote: Inclusive, equitable and green growth Access to quality social services Stronger governance and participation

35 One Budget / Agencies UN Agencies Budget Regular Resources Other Resources (non- OPF) One Plan Fund One Plan Budget (a) (b) (c) (a)+(b)+(c) FAO 3,300,000 22,530,000 11,060,000 36,890,000 IFAD 0 1,000, ,000,000 ILO 1,500,000 22,280,000 10,180,000 33,960,000 IOM 557,500 3,295,000 1,647,500 5,500,000 ITC 630,000 1,920,000 1,090,000 3,640,000 UN Women 3,150,000 2,700,000 2,480,000 8,330,000 UNAIDS 575,000 3,625,000 1,800,000 6,000,000 UNDP 44,165,000 57,479,999 38,715, ,360,000 UNEP 311,000 15,790, ,000 16,806,000 UNESCO 1,290,000 6,058,070 3,149,000 10,497,070 UNFPA 22,500, ,000 9,930,000 33,100,000 UNHABITAT 1,621,000 4,270,200 2,524,800 8,416,000 UNICEF 18,050,000 37,985,000 24,015,000 80,050,000 UNIDO 600,000 20,816,000 8,300,000 29,716,000 UNODC 0 10,119,700 4,338,000 14,457,700 UNV 0 1,092, ,000 1,560,000 WHO 9,300,000 25,665,000 14,985,000 49,950,000 One Plan Budget 107,549, ,295, ,387, ,232,770

36 Focus Highlights of development results Area Lessons 1 learned UN agencies have contributed to the following results at the outcome level by providing technical assistance, policy advice, capacity development etc People centered economic growth and decent work Lessons Focus Area learned 1 Resolution 80 on sustainable poverty reduction in ethnic minority areas developed Land Law revised with information sharing on the best international practices by UN and development partners National Statistical Development Strategy approved and implemented and Statistics law revision underway First Inter-Census Population Survey agreed and planned for 2014 National Business Registration System (NBRS) established Code of Conduct and new circular on recruitment Labour Code revised and enforced; Employment Law drafted and awaiting for approval SME Development Plan developed and cluster policy submitted for PM approval Addressing climate change, strengthening environment management and managing disaster risk Disaster Risk Management Law approved that consisted of role of community and gender equality and inclusive approach National REDD+ Action Programme approved and rolled out Green Growth Strategy adopted, targeting 8-10% reduction of GHG emission intensity by 2020 National policy and capacity for industrial energy management enhanced National Target Programme on Pollution Mitigation and Environment Improvement ( ) on progress

37 Focus Area 2 More effective Social Protection System Highlights of development results Policy advice and recommendations for Party Resolution 15 on major social policies for the period and the plan for its implementation A better functioning health system Revision of the Health Insurance Law, Pharmaceutical Law; Passage of the Tobacco Control Law; Development of the New National Nutrition Strategy for and the National Plan on Sexual and Reproductive Health focus on maternal and neonatal health Amendment of the Labour Code, with the landmark provision on the extension of paid maternity leave from 4 months to six months; Expanding quality and reach of the education system The National framework to Build a Learning Society ( ) and The Education Development Strategic Plan (EDSP) Promoting Gender equality and responding to HIV The New Labour Code recognizes domestic work as work and includes the prohibition of sexual harassment for the first time. Stronger legal and policy frameworks for the HIV response, through termination of compulsory detention of sex workers

38 More responsive elected bodies Development of practices and tools for more effective oversight and law-making Legal and justice system reforms Human rights based law and policy making: e.g. Law on the Handling of Administrative Violations and corresponding sub-laws; NTP on crime prevention and suppression Reviews, high level policy dialogues and recommendations to address compliance of domestic laws with human rights conventions Law enforcement and Criminal Justice Practitioners are better equipped with knowledge and capacity to handle smuggling of migrants, human trafficking, victims of sexual abuse Better performing public sector institutions Anti-corruption: Focus Area 3 Govt self-assessment report and international peer review on UNCAC; Revision of the anti-corruption law; Law enforcement & criminal justice authorities enhanced investigation and prosecution capacities of money laundering and corruption cases Public administration reform: The first-ever Public Administration Reform (PAR) Index developed and used by the GoV Issuance of professional standards for public officials at commune level Effective participation by citizens and NGOs in decision-making : Highlights of development results Capacity of social organizations strengthened to represent its member organizations in the 1992 Constitution Amendment and 2003 Land Law revision processes

39 One Budget / Focus Areas Focus Areas Focus Area 1 Focus Area 2 Focus Area 3 Regular Resourc es (Secured ) 29,611, ,763, ,175,0 00 Other Resourc es (Secure d) Resource to be mobilized (One Plan Fund) Resource to be mobilized (Non- OPF) 41,736, 51,684,06 74,985, ,848, 56,195,97 68,062, ,370,0 27,507,25 28,292, Total Percentag e 198,017, % 186,870, % 95,345, % Budget One Plan ,549, TOTAL ,954, 135,387,3 171,341, ,232, % USD 43,562,287 : 2012 Total expenditure under UN One Plan

40 FOOD AND AGRICULTURE ORGANIZATION IN VIETNAM FAO Total budget in 2013 : USD 5,956,783

41 FOOD AND AGRICULTURE ORGANIZATION IN VIETNAM FAO

42 Total budget in 2012 : USD 25,692,481

43 Total budget in 2012 : USD 4,747,516

44 Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Case study How to work with UNIDO?

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46 UNIDO Technical Cooperation Procurement in 2013 Name N. of Contracts / Purchase Orders Amount USD ($) Contracts for Services/Works ,612,238 Purchase of Equipment ,690,510 Total ,302,748 UNIDO HQ Vienna Procurement in 2013 Name N. of Contracts / Purchase Orders Amount USD ($) Contracts for Services/Works ,160,595 Total ,160,595

47 Procurement Methods I. Requesting competitive quotations Single supplier is less than 40,000. Quotations will normally be requested from several firms or organizations. Quotations shall be submitted through UNIDO e-procurement Portal ( II. Requesting competitive proposals/inviting competitive bids Single supplier from 40,000 and higher; applying either of the two formal procurement processes: Invitation to Bid (ITB), and Request for Proposal (RFP) Competitive proposals/bids for intended commitments in value from 40,000 up to 1.000,000 one single file through our e- Procurement portal, for intended commitments in value from 1,000,000 or higher, in two different files, one of which is a technical offer, and the other, a commercial offer. Documents are placed on the external Website of UNIDO, UNGM (UN Global Market Place), other Websites as may be relevant, requesting qualified suppliers to submit their offers.

48 Requesting competitive quotations

49 Requesting competitive quotations

50 Requesting competitive proposals/inviting competitive bids The United Nations Global Marketplace - UNGM - is the common procurement portal of the United Nations system of organizations. It brings together UN procurement staff and the vendor community. The United Nations represents a global market of over USD 15 billion annually for all types of products and services.

51 TODAY 275 OFFERS WORLWIDE

52 TODAY 28 OFFERS FOR VIET NAM

53 TODAY 12 OFFERS FROM UNIDO

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58 Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux 4. O.D.A.

59 ODA disbursement 6 development banks 6 development banks Japan (JBIC), South Korea (KEXIM), World Bank, Asian Development Bank, Germany (KfW), France (AFD) account for 96% of signed loans and 92% of signed grants. The 6 have active portfolios of USD 36.8 billion in loans and USD 2.60 billion in grants. JICA is the largest donor by accumulated portfolio (USD 15.3 billion), followed by the World Bank and the ADB Transport (40%), Energy (20%) and Social Infrastructure are the largest sectors though there is a general trend to increase the proportion of funding allocated to transport and energy.

60 ODA disbursement for 6 Development Banks Donors Signed Accumulated to 12/2013 disbursement Disbursement in 2013 Total Loan Grants Total Loan Grants Total Loan Grants Total 39, , , , , , , , Japan (JBIC) 15, , , , , , South Korea (KEXIM) 1, , Germany (KfW) 1, France (AFD) ADB 7, , , , , , WB 10, , , , , , banks 36, , , , , , % of the total Figures as of 31/12/2013

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63 Financial allocation : 400 M grants focused on two : (1) Governance and (2) Energy / Climate change. EU grants and loans to Vietnam are in line with the country's socioeconomic priorities, as underlined in the Socio-Economic Development Strategy.

64 ASIAN DEVELOPMENT BANK ADB Since 1993, USD billion (as of December 2013). 150 loans totaling USD billion, 276 technical assistance projects amounting to USD million, and 29 grants totaling USD 170 million. Largest share of cumulative lending amount are transport and communications (33.3%), energy (18.2%), and agriculture and natural resources (13.5%). Example of ongoing ADB Vietnam projects Ha Noi Metro Rail Extension Project (Line No.3: Ha Noi Railway Station - Hoang Mai Section). Technical Assistance, ADB financing : USD 1.5 million Productive Rural Infrastructure Sector Project in the Central Highlands : to regenerate and upgrade underdeveloped or outdated productive rural infrastructure. Loan, ADB financing : USD 80 million Secondary Cities Development Project: this project in Ha Tiinh, Tam Ky and Buon Ma Thuot, focusses on flood risk reduction, urban environment improvement and provides project management and capacity building support. Loan, ADB financing : USD 95 million Central Mekong Delta Region Connectivity Project: to improve connectivity in the Mekong Delta Region in Viet Nam through construction of two cable stayed bridges across the Mekong River and associated roads. Loan, ADB financing : USD 410 million

65 Kreditanstalt für Wiederaufbau - KfW Commitment of German Government from 1993 to 2013 : EUR 2 billion. Currently KfW is supporting around 40 projects in Viet Nam, e.g. in the fields of waste water and solid waste, health, forestry and vocational training. Environment Sustainable Forest Management and Biodiversity as a measure to decrease CO2 emissions: EUR 20 million Water Supply at Nat. Econ. University: EUR 4 million Wastewater and Solid Waste Management in Provincial Towns: EUR 136 million Sustainable Economic Development Vocational Training Programm Vocational Training: EUR 5 million Green competence center Vocational Training: EUR 6.5 million Health Prevention & Control of Avian Influenza: EUR 4 million Viet Duc Hospital Hanoi: EUR 5 million

66 Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Conclusion Viet Nam Medium Term Perspective

67 Inclusive and Sustainable Industrial Development Viet Nam Medium Term Perspecti Viet Nam world best performer on industrial competitiveness : from 72 in 2005 to 54 in 2010 (gained 18 places)

68 Inclusive and Sustainable Industrial Development Viet Nam Medium Term Perspecti

69 Inclusive and Sustainable Industrial Development Viet Nam Medium Term Perspecti

70 Inclusive and Sustainable Industrial Development Viet Nam Medium Term Perspecti GDP in 1990 : 118 USD GDP increase

71 Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Hotel Pullman - 27 mai 2014

72 Rencontres de Hanoi Atelier : Comment travailler avec les bailleurs internationaux Hotel Pullman - 27 mai 2014 MERCI POUR VOTRE ATTENTION p.gilabert@unido.or g