In 1993, only 30 percent of the Vietnamese population lived within two kilometers of an all-weather road. In 1999, the World Bank identified a massive effort to restore the country’s rural road network to adequate standards as a critical input to rural and national economic development.
The IDA supported Second Rural Transport Project (2000-2006) was identified and designed to
- Provide lowest-cost basic road access to all communes and to rehabilitate other district and commune roads in 40 project provinces
- Build the capacity of provinces, districts and local communes to plan and implement long-term rural road maintenance
- Train private contractors
- Help the Ministry of Transportation formulate and implement rural transport policies.
Improved access to all-weather roads was achieved for approximately 16 million rural residents, 950,000 of whom were poor. Some 210,000 people were lifted out of poverty.
- Some 7,600 kilometers of roads and 26,000 meters of bridges were rehabilitated; road usage by rural residents increased by 70 percent during the project, with a 12 percent drop in travel time to destinations such as markets, clinics, schools and district centers.
- Evidence shows the number of health-care visits increased, higher school attendance and greater access to local government.
- Ensuring access to the rural road construction market spurred development of the fledgling private sector in an area where state provision had been, until recently, the norm. Participation by small, private contractors increased from 35 percent of contracts awarded in 2000 to 100 percent six years later.
- Technical assistance has helped make public spending in the transport sector more effective, allowing the government to better target the US$3 billion of investment flowing into the sector during the next phase of scheduled improvements in 2006-10.
- IDA provided US$103 million in financing, a bit more than two-thirds of the total project cost (US$145 million).
- Technical expertise combined with large-scale support enabled the government to realize the reductions in poverty that rural roads can provide.
- IDA leveraged its unique ability to help manage the large number of contracts (over 2,000) necessary to have an impact in the sector.
The United Kingdom’s Department for International Development (DFID) provided US$36.2 million in bilateral grant financing under Road Transport Project II and has provided a further US$47 million for Road Transport Project III (2006-10).
The World Bank is shifting from project support for financing rural roads to approaches that facilitate broader government programs, capacity building and policy reform. The next phase of support will focus on the national and provincial program, using government systems as much as possible. Consequently, provinces with proven capability for managing rural transport programs efficiently and transparently will be rewarded with full decentralized authority. Those that have not reached this stage are provided additional technical assistance to develop investment management capacity. This approach employs performance incentives and increased post-implementation reviews to ensure that procurement is carried out transparently.