For a long time, top-down planning was seen as the way to implement political choices in efforts to improve living standards in Vietnam. However, this led to the development of infrastructure that failed to match community needs, largely as a result of weak administrative capacity, a lack of transparency and accountability in the use of public funds, the disconnect between the decision-makers and beneficiaries, and the lack of project-based planning and.
The new approach, which invited local beneficiaries to participate in the decision-making process and the implementation of local development projects, had not been popular in Vietnam before. They neither knew how to participate in local decision-making processes nor had adequate capacity and experience in participating in development activities. At the same time, the mechanism for people’s participation was weak and guidance and information to help them take part in the decision-making process were not available.
In the early 2000s, the Government started its new policy to pilot the decentralization of decision-making from the central to the provincial level. There was skepticism over management capacity at the lower levels in the government administrative system. Development programs and activities were often top-down with no participation from the grass-roots level, and the introduction of new instruments with a bottom-up approach was only accepted with hesitation.
Recognizing these development challenges, the project established standardized procedures and steps to guide the local people on how to take part in the decision-making process. It established platforms for participation, such as local consultation meetings to identify and select the needed infrastructure to be funded by the Project. Community facilitators were recruited to help local people own their development decisions with budget allocated and publicly announced.
Beneficiaries were trained to identify the necessary infrastructure, and monitor the quality of local, small-scale development projects. For the first time, communal authorities were designated to be the executing agencies of local development projects. Capacity-building activities were conducted to ensure that they have the ability to manage the different aspect of project implementation, including financial management, procurement management and quality control at a level acceptable to the Bank.
Between 2002 and 2009, the project increased the capacity for decentralized and participatory planning and management of development activities in 760 communes across 115 districts in 13 central provinces. The project provided training and technical assistance to all levels of government staff involved in the project. A total of 76,528 people received training provided by the project, of which 2,500 were project staff at all levels and the remaining are people from 12 communes.
It has provided nearly 8,500 essential community-based infrastructure facilities for social and economic benefits, of which 95% were constructed following communities’ decisions. Employment in construction of infrastructure generated 1.8 million days of labor and income of about US$4.5 million. Altogether, a total of 8,462 infrastructure schemes were completed. A case study showed that this infrastructure improved rural basic services, including water supply, schools, health stations, and roads, and also infrastructure that supported production activities including irrigation and markets.
Because local residents, women included, had a say in deciding the community facilities financed under this project, their sense of ownership was significantly increased, and thus, the sustainability of the construction.
The Bank financed US$9 million to build capacity for local authorities in 760 communes (which was up from 540 at the project design stage) in participatory planning processes and implementation procedures. Within this package, training was provided to communities on participatory investment planning. On small-scale infrastructure investments, the project used US$108 million to fund over 8,460 works at village, commune, and inter-commune levels, including irrigation systems, transport networks, sub-district markets and other necessary public facilities.
The Vietnamese Government, acting through its Ministry of Planning and Investment as the project partner, has made a strong commitment to the project’s participatory approach and provided support and guidance to enable project implementation.
Toward the Future
Central government ministries and local authorities appreciated the project for its innovative and effective approach, as decentralization to the grass-roots level had not been a common practice. After project implementation was completed, the Government carried out a thorough review and concluded that the participatory planning and management approach was the right direction for a future program of the same type. Consequently, the Government asked the Bank to fund a second phase of the project, aiming to mainstream the decentralization arrangement into the government-funded program of activities towards poverty reduction and rural development.