MANILA, PHILIPPINES – A US$30 million loan from ADB will contribute to the sustainable growth of Viet Nam’s agriculture sector by helping improve and modernize agriculture science and technology in the country.

Over the past decade, Viet Nam's agriculture sector has grown rapidly. From a net importer of rice in the late 1980s, the country has become one of the largest rice exporters in the world and now exports large quantities of commercial crops.

The Government plans to further improve the quality of the country's produce, diversify into higher value products and markets, increase productivity and value addition, and improve technology development.

In practice, access to new technologies by farmers and agro-based enterprises is essential as Viet Nam’s agriculture is gradually shifting its focus from increased production volumes to increased production values.

The project will address critical issues in three key areas – agricultural research, extension, and rural-based training. It aims to promote more client-oriented activities with improved mechanisms for disseminating technology that reflects demand, develop better physical and human resources, and improve linkages among the three covered areas.

To boost agricultural research and capacity training, it will fund research proposals that respond to the sector’s practical needs, support further training and graduate studies for staff of agricultural research institutes, and upgrade research and laboratory equipment in selected institutes.

It will also improve farmers’ access to agricultural extension services, or information or education, in mainly upland or remote areas in five provinces – Dak Nong, Nghe An, Ninh Thuan, Quang Nam, and Thanh Hoa. Training, such as on business skills, advanced agricultural science and technology, and integrated pest management, will be provided based on needs. The project will also support on-farm demonstration trials through contractual arrangements with regional or national research institutes to strengthen the links between research and extension.

Last, teachers will be trained in 10 rural-based technical and vocational training schools where school equipment and facilities will be upgraded under the project.

The project complements the Agriculture Sector Development Program, which was approved in 2002 with a $90 million loan from ADB.

ADB’s new loan, from its concessional Asian Development Fund, carries a 32-year term, including a grace period of 8 years. Interest is charged at 1% per annum during the grace period and 1.5% subsequently.

The Government will contribute $10 million equivalent toward the project’s total estimated cost of $40 million. The Ministry of Agriculture and Rural Development is the executing agency for the project, which is due for completion around December 2011.