Vietnam, Japan sign three ODA projects valued at $500M

Vietnamese Prime Minister Pham Minh Chinh and his Japanese counterpart Fumio Kishida witnessed the signing of three ODA projects with a total value of 61 billion yen (US$500 million) on Sunday.

Vietnam will use 50 billion yen of this funding for the new-generation ODA (Official Development Assistance) budget support program for post-Covid-19 socioeconomic recovery and development, and the rest for the development of transport infrastructure and agriculture projects in the southern province of Binh Duong and and the central highlands province of Lam Dong.

On Sunday, Chinh also held talks with Kishida on the occasion of partcipating the G7 Summit in Japan’s Hiroshima.

Japan is the largest provider of concessional ODA to Vietnam, with 2.98 trillion yen ($21.6 billion). Japan’s ODA accounts for over 30% of bilateral aid to Vietnam.

The two PMs said that the two countries would discuss the possibility of Japan providing new generation ODA for large-scale strategic infrastructure development projects, such as the North-South expressway, urban railways, green transformation, and medicine. These loans will have high incentives, with simpler and more flexible procedures than before.

Some ODA projects are currently behind schedule, such as the Cho Ray 2 Hospital and the No. 1 Ben Thanh - Suoi Tien Metro of HCMC.

Chinh said he would direct ministries and sectors to accelerate the progress of these projects, ensuring effective investment.

Chinh asked Japan to promote a new wave of Japanese investment in Vietnam in high technology and renewable energy.

He also suggested the Japanese government simplify visa procedures and move towards visa-free entry for Vietnamese citizens to promote tourism cooperation and create favorable conditions for the community of nearly 500,000 Vietnamese in Japan.

Kishida said that Vietnam had a leading position in terms of Japan’s foreign policy in the region.

The two PMs agreed to promote defense-security cooperation and strengthen the connection between the two economies by boosting investment and trade cooperation.

Both sides affirmed their stances on issues of mutual concern at multilateral and regional forums such as ASEAN, United Nations and APEC.

Chinh attended the 49th G7 Summit from May 20-21, following the invitation of Kishida. This is the third time Vietnam has attended this summit and the second time at the invitation of Japan.

Vietnam is one of two Southeast Asian countries invited by Japan this year, with Indonesia.

The G7 Summit features its core members, the United States, U.K., France, Germany, Japan, Canada and Italy, which all play an important role in shaping and strengthening global structure and governance.

Vietnam and Japan celebrate the 50th anniversary of diplomatic relations this year. The extensive strategic partnership between both countries has developed comprehensively over time. Japan is the first G7 country to recognize Vietnam’s market economy regulations.

Japan is Vietnam’s fourth largest trading partner, with the import and export turnover last year reaching nearly $50 billion, increasing from $42.7 billion in 2021. In the first three months of this year, the import and export turnover of the two countries reached nearly $11 billion.

It ranks third among 143 countries and territories in terms of investment in Vietnam. By the end of March, Japanese enterprises had invested in over 5,000 FDI projects with a total capital of nearly $70 billion.