German credit institute finances two projects
The German Reconstruction CreditInstitute (KfW) will sponsor Ho Chi Minh City’s metro project and theNorwegian mixed credits programme with funding of Euro 62 million.
Two contracts to this effect were signed in Hanoi on March 1 between Vietnam’s Ministry of Finance and KfW.
The Euro 28 million contract for a project to build metro line No 2 in Ho Chi Minh City includes Euro 10 million in non-refundable aid and Euro 18 million in loans. The project is being carried out using capital sourcing from the Asian Development Bank, the European Investment Bank (EIB) and KfW.
The sum is part of the German Government’s capital for the Euro 240.75 million project.
The other contract, worth Euro 34 million, will finance six projects (out of the total 12) on clean water supply and environmental hygiene in a number of Vietnam’s localities.
The Norwegian Government has pledged to provide finance for these projects as agreed in a memorandum of understanding signed on October 22, 2003 between the Vietnamese and Norwegian Governments.
Under the MoU, Vietnam will borrow capital from a bank to implement selected projects and the Norwegian Government pledged to support all interest rate and other fees of the loan. KfW was selected by both sides to provide commercial loans to implement the preferential credit programme.
VOVNews