PANO - The European Investment Bank (EIB) provided EUR 100 million to Vietnam with the main purpose of part-financing investments that will contribute to the mitigation of climate change.

Mr Francisco de Paula Coelho, EIB Director for Lending Operations in Asia, and Mr Tran Xuan Ha, Deputy Minister of Finance, signed the loan agreement today in Hanoi.

EIB Director Francisco de Paula Coelho praised “the cooperation of Vietnam’s Ministry of Finance” and stressed that “the framework loan will make long-term loans at attractive interest rates available to support renewable energy and energy efficiency projects, a priority for the Bank’s lending”.

The Ministry of Finance will make available the proceeds of the EIB’s framework loan to four state-owned banks, who will on-lend the funds to final beneficiaries carrying out investments that contribute to one of the following objectives: (a) climate change mitigation, through projects in the renewable energy and energy efficiency sectors, which would account for at least 70% of the loan amount, or (b) support European presence in Vietnam, through direct investment or transfers of technology and know-how from Europe, which would account for up to 30% of the loan. Both objectives are set in the EU Mandate to lend in Asia and Latin America (ALA).

Interested promoters should address their requests to one of the four intermediary banks, which cover different areas of the Vietnamese economy: Vietnam Development Bank (VDB), Vietnam Bank for Agriculture and Rural Development (Agribank), Bank for Investment and Development of Vietnam (BIDV) and Vietnam Bank for Industry and Trade (Vietinbank).

This is the EIB’s fifth operation in Vietnam, where it started operations in 1996. It is also the second lending operation with the Ministry of Finance, who received a EUR 30 million credit line in 2005, for financing small and medium scale projects; the line was also allocated through intermediary banks, including Agribank and BIDV.

Ngoc Hung