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World Bank stimulus creates jobs in Vietnam

Written by David Pingree

The World Bank and the Vietnamese government have launched a one-year joint study that will ultimately create a plan for long-term sustainable growth and modernization.

After the study, analysts will recommend reforms that will aim to create more social, political and social opportunities for Vietnamese citizens while encouraging equality, Hispanic Business reported.

The World Bank has pledged USD 3.8 billion in financing through the International Development Association over the next three years.

The announcement came after representatives from the World Bank and other donors met with Vietnamese officials in Hanoi last month to review the impact of the Third Rural Finance Project.

The Third Rural Finance Project was created in order to stimulate economic growth and reduce poverty for Vietnam’s rural businesses and households by increasing access to financial resources. After the first five years, donors supplied more than USD 487 million to the project, mostly through medium to long-term loans managed by the Bank for Investment and Development of Vietnam.

The workshop declared the rural finance project to be largely successful. According to officials, more than 135,000 people and businesses were granted access to loans, generating more than 140,000 new jobs in turn.

Funding for the rural finance project will continue through 2033 and is expected to reach a total of USD 5 billion, according to Saigon Giai Phong.

Vietnam has also been making strides in providing health care for its 93 million citizens, according to a new Forbes report.

While the country remains well short of the World Health Organization’s standards, its government is showing progress by increasing health care spending. Health care spending currently accounts for 6.4% of the country’s GDP, the second most in ASEAN behind Thailand.

“Vietnam has made impressive progress toward improving the health status of the population, with progress that equals or surpasses that of many neighboring countries,” wrote Nguyen Duc Hinh, the President of the Hanoi Medical University and Hoang Van Minh, a Lecturer at the Department of Health Economics at Hanoi Medical University, a year ago.

However, medical costs are expected to rise as more patients are diagnosed with curable long-term illnesses.

In addition, the country is experiencing a growing discrepancy in the quality of care between rural and urban communities. As Vietnam continue to liberalize its economy, the quality of medical service in rural areas is gradually declining as many doctors migrate to more populated regions for work. Doctors in the cities face obstacles as overcrowding and “off-the-book payments.”

In response to the growing demand for Western medicine, Vietnam is projected to experience 20% compound annual growth rate for pharmaceuticals over the next five years, according to Forbes. Per capita health expenditures are estimated to rise to USD 116 per year by the end of 2014, up from USD 66 per year in 2008.

— Edited by Kristine Diaz

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