Japan's ODA to Vietnam may exceed 100 billion yen in 2023

Japan's ODA capital for Vietnam in fiscal year 2023 could exceed 100 billion yen ($674 million) - the first time since 2017.

A joint statement after talks betweenPresident Vo Van Thuong and Japanese Prime Minister Fumio Kishida on November 27 said that Japan's ODA loans to Vietnam in 2023 will exceed 100 billion yen (674 million USD) for the first time since fiscal year 2017. Japan's fiscal year usually begins on April 1 of a year and ends on March 31 of the following year.

Official development assistance over the past 30 years has been recognized by Vietnamese and Japanese leaders as having made positive contributions to Vietnam’s socio -economic development. This capital flow also affirms the desire to strengthen cooperation to energize cooperation with Japan, promoting large-scale, high-quality infrastructure projects in Vietnam.

The two leaders reaffirmed their commitment to stepping up efforts to resolve remaining difficulties in implementing ODA projects, including technical cooperation projects in Vietnam, through a cooperation mechanism.

The two sides also intend to promote and implement new ODA projects, focusing on areas such as infrastructure, digital transformation, green transformation, climate change response, and healthcare . The new capital flow is expected to be highly preferential, with simple and flexible procedures.

The two leaders also shared a common understanding of the urgency of promoting major economic projects, including those using Japanese ODA and FDI. Vietnam and Japan will identify specific projects as soon as possible, and from there, study the possibility of establishing a coordination working group between the two governments in Vietnam to accelerate the implementation progress.

Japan began providing ODA to Vietnam in 1954. After a period of interruption, it began refinancing in November 1992. Since 1995, Japan has been the largest ODA donor among bilateral donors to Vietnam. The total loan value as of the end of fiscal year 2020 was 2,812.8 billion yen (equivalent to 27.5 billion USD).

The Japan International Cooperation Agency (JICA) office said that ODA capital focuses on key areas such as transportation, energy, and urban infrastructure.

Recent ODA projects of Japan with Vietnam

Unit: hundred million yen. Source: JICA

Fiscal year	Loan Project	Grant aid project	Technical cooperation project
2017	618	26	67
2018	0	5	64
2019	0	24	50
2020	485	21	43
2021	108	7	49
2022	189	7	47
Cumulative total up to March 2023	28,031	965	1,831

Those capital flows were formed through 3,300 km of roads built (equivalent to 70% of high-standard two-lane roads in Vietnam), power plants with a total capacity of 4,500 MW (about 10% of national electricity output), or iconic projects such as Nhat Tan Bridge, Binh Hung Wastewater Treatment Plant, Metro Line 1. In addition to the hardware in infrastructure construction, ODA capital also supports software such as human resource development; institutional building, legal policies. When Covid-19 broke out, Japan also actively supported Vietnam in the fight against the epidemic.

Duc Minh

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