The Japan International Cooperation Agency (JICA) provided a loan of up to US$7 million to the Binh Duong Water Environment Joint Stock Company (BIWASE) of the Socialist Republic of Vietnam on December 9.
The agreement has been signed. The loan will contribute to the “Initiative for Overseas Investment and Loan to ASEAN” (*1) announced by the Japanese government in November 2019, and will be cofinanced by the Asian Development Bank (ADB). The ADB loan will be financed by US$6 million from the Leading Asia’s Private Infrastructure Fund (LEAP), which is funded by JICA.
Vietnam’s rapid urbanization and industrialization in recent years have resulted in a rapid increase in waste in urban areas. The lack of intermediate treatment facilities such as incineration and composting facilities has resulted in a lack of proper waste management, causing public health issues such as a shortage of landfill sites and air and soil pollution due to illegal dumping. Binh Duong Province, the target of this project, is adjacent to Ho Chi Minh City, the largest city in Vietnam, and has the highest population growth rate in the country. The province needs to expand its existing waste treatment facilities to meet the increasing demand for waste treatment in the region.
In addition, fertilizer prices continue to rise due to the situation in Ukraine, and there is a growing need for a stable supply of fertilizer to farmers. This project aims to contribute to the improvement of the urban environment and the realization of a circular economy in the region by supporting capital investment in the introduction of a waste composting plant with a capacity of 840 tons per day and financing the construction of a waste power incineration facility capable of processing 200 tons per day. The project will contribute to SDGs (Sustainable Development Goals) Goal 7 (energy), 11 (sustainable cities), and 12 (sustainable consumption and production). The project is also expected to reduce greenhouse gas emissions through waste recycling by composting.
The lender, BIWASE, established in 1975 and privatized in 2016, is a water supply and waste treatment company and the only waste treatment company in Binh Duong Province that provides general waste treatment. JFE Engineering Corporation holds a 3.87% stake in the company.
This loan is the second overseas investment loan for BIWASE, following the “Binh Duong Province Water Supply Expansion Project” (Loan Agreement 2020)(*2). BIWASE, as the implementing agency of the Yen Loan, has been supporting the spread of sewage systems and improvement of sewage treatment plant capacity in Binh Duong Province through the “Southern Binh Duong Province Water Environment Improvement Project” (Loan Agreement 2007) and the “Southern Binh Duong Province Water Environment Improvement Project (Phase 2)” (Loan Agreement 2012). JICA will continue to support the long-term development of Vietnam based on the relationship of trust built with long-standing partners such as BIWASE.
© Source JICA