Nowadays, it is an inevitable trend of integration into the world. There is no exception for Vietnam Development Bank, either. The Development Assistance Fund transformation to a bank enables it more active in international cooperation.
I. Fund mobilization from international financial markets
In 2006, the Vietnam Development Bank was established on restructuring the Development Assistance Fund under Decision No. 108/2006/ND-CP dated May 19th 2006 by the Prime Minister. Accordingly, VDB shall mobilize and receive funds from domestic and foreign institutions to execute the State investment and export credit.
Then VDB was to enhance its international cooperations.
In 2008, International Cooperation Division was established under the Foreign Capital Management and International Relation Department and then formed a full Department of International Cooperation in 2009.
Achievements could be seen in increasing numbers of partners and mobilization of foreign sources for important projects.
Hanoi-Haiphong expressway is one of those. So far, VDB suceeded in fund mobilizing from different donors: the German KfW Bankengruppe, Korea Export –Import bank(KEXIM), Citibank and SMBC in order to finance the project. Some other banks (Credit Agricole CIB, Export-Import Bank of China) have also been nominated as lending arrangers for the project.
More positive results could be seen in singed loan agreements with AFD (EUR 30 million loan for the Urban Water Supply Investment Program in Mekong Delta), JICA (JPY 4,682,000,000 loan for saving/renewable energy projects e.g.; KFW (EUR 10 million supporting small and medium enterprises), EIB (USD 100 million for the renewable energy projects), ADB (USD 20 million for vocational colleges). Recently, in 2011, a loan agreement of USD 100 million has been signed by VDB and JBIC to develop supportive industries.
VDB also actively try its best to seek funds for projects: Bac Lieu wind power plant under a credit limit of USD 500 million committed by U.S. Export-Import Bank(U.S EXIM); Binh An hospital project expectedly mobilized from potential partners such as Northstar (Canada), Defex (Spain), China Eximbank.
In order to ensure its fund in future, VDB plans to mobilize by bond issuance in international financial markets. VDB has discussed with Daiwa Capital Markets Singapore on Samurai bonds issuance backed by Japan Bank for International Cooperation (JBIC).
II. Learning management experiences through technical assistance programs
As a traditional partner with many insitutions, VDB always closely coordinates with them in technical assistance projects in order to perceive technology advances in management of outside experts. Within 2006-2011 years, the VDB coordiated with foreign partners to organized series of training courses, workshops and study tours, namely:
- Ennhancing financial capacity for export support funded by the French Development Agency and French scientific and technical exchange and assistance Agency -ADETEF.
- VDB’s Institutional Capacity Development by Japan International Cooperation Agency JICA.
- Korean Supporting Programs jointly coordinated by Korea Ministry of Finance and Strategy and Vietnamese Ministry of Finance during period 2006 - 2010.
- Experience exchange programme with CIM experts (Germany);
- A technical assistance program on credit guarantee for small and medium enterprises jointly coordinated by the U.S. Department of Finance and Vietnamese Ministry of Finance.
In addition, to affirm its position as well as to raise its voice in the international forums and financial organizations, VDB has actively participated in international seminars and workshops. In 2010VDB hosted the ADFIAF’s SMEs survey programme in Hanoi.
III. Development Orientations
Long-term policies in which VDB becomes a modern development bank relevant to other international organizations requires its international cooperation activities realistic, effective and significantly make full use of external resourses for the purpose of sustainable development. In short term, it is focused on the followings:
- To continuously strengthen relations with traditional partners as development financial institutions, and set up and open partnership with commercial financial institutions as well.
- Cooperation helps VDB approach world financial markets, access international financial products, and then helps VDB to mobilize capital from international market.
- To take best advantage of technical assistance from foreign partners via short-term seminars and workshops;
- To seek and set up service bank netwok for international settlements.
IV. Members
1. AEBF
ABOUT AEBF
The Asian Exim Banks Forum (AEBF) was established in 1996 at the initiative of Export-Import Bank of India (Exim India) to enhance cooperation and create a stronger link among Asian Exim Banks/ ECAs having the same objectives of economic development in line with their governments’ export-oriented strategy.
Major Forum’s activities include:
CEOs Annual Meeting is hosted by a member Exim Bank by rotation. The leaders come together for sharing ideas and delivering joint statement to promote intra-regional trade, response to global financial crisis, challenges and sustainbable growth mechanism.
Training sessions of Forum also provide a sound platform for knowledge sharing by way of training programs that help the staff of the member institutions learn the best practices.
The latest Asian Exim Banks Membership Protocol is approved by consensus of all members at 20th CEO Annual Meeting held in Jodhpur, India in November, 2014. The Forum members have entered into various bilateral and multilateral agreements, such as: reciprocal risk participation agreements (RRPA)…
Members of Forum are major ECAs from 10 countries, namely, Autralia (EFIC), China (ChinaExim), India (Exim India), Indonesia (Indonesia Exim), Japan (JBIC), Korea (KEXIM), Malaysia (Exim Malaysia), Philippines (PhilExim), Thailand (Thai Exim) and Vietnam (VDB); with Asian Development Bank (ADB) as a permanent observer.
Forum website: http://www.asianeximbanks.org/
VDB and AEBF’s cooperation milestones
- VDB has participated in Forum’s activities as observer since 2006.
- VDB summited the Application Form to AEBF on December 20th, 2010.
- VDB was a associate member from 2011 to 2012.
- VDB became 10th regular member at 19th Annual Meeting in Wuyi Mountain, China in 2013.
- VDB will undertake the Chairmanship of Training Committee from June, 2015 to June, 2016.
2. ADFIAP
OVERVIEW ABOUT ADFIAP
The Association of development financing institutions in Asia and the Pacific (ADFIAP) is a non-profit organization, established to assist sustainable socio-economic development in Asia-Pacific through boosting cooperation activities among member-institutions such as training, experience exchange, advisory services. It is involved in promoting and advocating development financing initiatives such as: SME-financing or micro-financing, green energy… Founded in 1976, ADFIAP has currently 131 member-institutions in 45 countries. ADFIAP is also a founding member of the World Federation of Development Financing Institutions composed of regional associations in Africa, Asia-Pacific, Latin America and the Middle East. The permanent Secretariat of ADFIAP is based in Makati city, Metro Manila, Philippines.
Cooperation history between VDB and ADFIAP:
May, 2006: DAF (precedent of VDB) enjoyed an observer status when participating in 29th ADFIAP Annual Meeting in Colombo, Sri-Lanka.
May, 2007: VDB was admitted by consensus as an official member of ADFIAP at 30th ADFIAP Annual Meeting in Hanoi.
Since Jan 01st, 2012: VDB has been appointed as Board Member of ADFIAP – representative of Vietnam (replaced BIDV).
May 13th – 15th, 2015: VDB will host 38th ADFIAP Annual Meeting in Nha Trang, Vietnam - the first international summit Meeting hosted by VDB.
Since their observer status, VDB has participated in many cooperation activities organized by ADFIAP such as: training sessions, experience exchange programs; attending study tour programs at the countries of ADFIAP member-institutions; participating in annual meetings, CEO forums or other conferences...
Source: VBD