Employment-Intensive Investment in Viet Nam

Web page | 10 December 2014

Current EIIP Involvement

Current EIIP Projects in Viet Nam:
• Developing a Public Employment Programme (PEP) for Unemployed and Underemployed People in Viet Nam (Total budget: 161,280)

Historical Information

Compared with other countries in this region, the ILO's support of the rural infrastructure sector of Vietnam is fairly recent. In 1999, ASIST-AP (a hub of EIIP in Asia) carried out awareness- raising workshops at the Hanoi University of Communications and Transport (HUCT) on the issues of labour based methods, local level infrastructure planning and small scale contracting in Vietnam. In addition, a study was carried out on behalf of MOLISA on the Social Safety Nets, Public Works and Employment in the Infrastructure and Construction Sectors.

As a follow up to this work in Vietnam, ASIST-AP has been exploring with the government ways in which it may be able to assist in ensuring that major infrastructure programmes can contribute to rural employment creation and the effective devolution of responsibilities to the provinces, districts and communes. The outcome of these discussions has resulted in the definition of an overall programme of work in the area of small-scale contracting and local level planning.

Integrated Rural Accessibility Planning
ASIST-AP commenced work in the field of local level planning in 2001 through a study which investigated the local level infrastructure planning procedures of local government and the validity of the accessibility planning tools within that system. In relation to this study, ASIST organised a workshop to discuss with local level planners how accessibility planning might be applied at a local level. This study was carried out in close collaboration with the Centre for Rural Development Planning, CERPAD in the Ministry of Construction.

Funding for this research was provided from regular budget resources of the ILO. The main objective was to develop a better understanding of the country's planning process and the feasibility of introducing the ILO's local level rural infrastructure procedures. Combined with a similar study looking at the role of the local construction industry in the provision of rural infrastructure, these activities would provide a greater understanding of the rural infrastructure sector and form a solid basis for ASIST's longer term strategy for assistance to Vietnam.

As a result of this initial study, the government requested the support of ASIST AP to carry out the full IRAP process in two districts in the country and to develop country specific guidelines.

Small-scale Contracting
Vietnam has a long tradition of executing infrastructure works through state-owned enterprises. There is now a move, strongly supported by the donors, to shift implementation of works to the private sector. This is a direction which provides the opportunity at the decentralised level for the increased involvement of local contractors, and the use of local resources, including the application of labour-based works technology.

In order for small contractors to successfully participate in the sector there is a need for effective and transparent contract management procedures in the decentralised government administrations. Through a number of rural infrastructure development projects the government is already pursuing such implementation arrangements. At the end of 2001, ASIST AP carried out a review of local contracting procedures in Vietnam as part of its efforts to develop a technical assistance programme related to sustainable provision of rural infrastructure.

Since mid- 2002, ASIST has participated in the formulation of the World Bank financed Road Network Improvement Project, RNIP, with a particular emphasis on the future role of the domestic construction industry in this project and in the road sector of Vietnam in general.

As part of this support, the ILO carried out an assessment of the capacity of the domestic construction industry to carry out road maintenance works, and identified various support measures to address any shortcomings of the industry. This was done in order to meet the performance requirements of the road sector in Vietnam as defined by its future work programmes.

In relation to the RNIP, these issues were addressed particularly regarding the periodic maintenance of national roads, for which it is envisaged that the local construction industry will take a lead role. This study not only relates to the private sector capacity, but also addresses capacity development issues related to state owned enterprises, which are eligible to bid for works according the procurement regulations of the Bank as well as by the capacity of local road agencies to manage contracts carried out by the local construction industry.

Further reading

• Private Sector Participation in the Road Network Improvement Project, Mission Report - PDF 962 Kb
Bjorn Johannessen, August 2003
• Private Sector Participation in the Road Network Improvement Project, Mission Report - PDF 447 Kb
Bjorn Johannessen, November 2002
• Small-Scale Contracting for Infrastructure Works in Vietnam - PDF 238 Kb
Peter Bentall, December 2001
• Social Safety Nets, Public Works and Employment in the Infrastructure and Construction Sectors, Construction Sectors - PDF 205 Kb
Harry O. Sandberg, December 1999
• Local Resource-Based Infrastructure Planning in Vietnam - PDF 237 Kb
Nori T. Palarca, 2001