The new initiative is slated to improve the sanitation conditions in Nha Trang, Quy Nhon and Dong Hoi cities.

“Vietnam has made notable socio-economic achievements recently,” Governor of the State Bank of Vietnam, Le Duc Thuy, said at the signing ceremony. However, investment in infrastructure, especially drainage, sewerage and waste treatment systems, cannot meet the fast pace of development in provinces and cities, he said.

The credit, provided by the International Development Association - the World Bank’s concessional fund for low-income countries - will be used to reduce flooding and improve the collection of sewage in the three cities through the construction of new sewers and drainage systems. Wastewater currently discharging into groundwater, rivers or the sea will be transferred to a number of new wastewater treatment plants to be built under the project.

About US$2 million of project funds will be made available for each city to build improved toilet facilities in schools and to provide small loans to householders for the construction of home sanitation facilities.

“As Vietnam grows and more and more people move to the cities, the environmental pressure on the urban environment is also growing,” said World Bank’s Acting Country Director Martin Rama. “This project will play an important part in the Government’s plan to improve urban sanitation standards throughout the country.”