The World Bank Group member's investment and advisory programs addressed key issues for Vietnam, ranging from climate change and food security to trade barriers and the housing finance gap, assisting local businesses in recovering from the COVID-19 pandemic and navigating challenging internal and external environments.
Despite overlapping crises and challenges, IFC has provided record amounts of funding to climate projects, small businesses, women, and farmers in Asia and the Pacific, with Vietnam ranking among the top five countries for long-term investment in the region for the fiscal year ending June 30, 2023.
The bulk of the long-term investment expanded lending to thousands of small and medium-sized organizations (SMEs), particularly women-owned businesses, and assisted low and middle-income property purchasers, all of which created employment and increased economic activity.
IFC investments in BaF, a prominent cattle producer, and GS25, a retail operator, as well as a commodity-backed warehouse lending facility for TTC AgriS, all contributed to the country's agriculture value chains and improved food security.
The largest global development institution focused on the private sector in emerging markets also provided over $1.3 billion in short-term trade and supply chain finance to Vietnamese companies, particularly garment and agribusiness suppliers, allowing them to continue importing and exporting goods while protecting approximately 100,000 jobs.
Climate and sustainability have been a major emphasis for IFC activities in Vietnam, in accordance with the government's dual objectives of being a high-income nation by 2045 and achieving net zero by 2050. IFC has contributed about $900 million in long-term financing to climate-related initiatives in the nation so far.
“As businesses gradually recover from the pandemic while weathering uncertainties of ongoing global crises, it’s the right time for the private sector to embark on a greener and more sustainable pathway of development to improve resilience and efficiency. This not only makes a strong business case for companies but will also help unlock the potential of the private sector as a driving engine of the country’s transition to a low-carbon economic growth model,” said Thomas Jacobs, IFC Country Manager for Vietnam, Cambodia, and Lao PDR.
IFC's consulting program in Vietnam facilitates climate business marketplaces and builds local enterprises' climate business capability. IFC is helping relevant ministries build policies to reward green projects and stimulate private sector engagement in the voluntary carbon market. IFC also advises steel, cement, and plastic firms to decarbonize to green their manufacturing.
IFC also helps the State Securities Commission of Vietnam develop and implement ESG norms and practices among market operators. This will leverage the capital market for green and sustainable climate change funding.
In FY2023, IFC committed a record $11 billion to 108 projects in Asia and the Pacific, up 10% year-over-year. $4.7 billion in long-term financing from its own account, $3.4 billion in mobilization, and $2.9 billion in short-term trade and supply chain credit to ease trade flows.
Tienphongnews