The Agence Française de Développement (AFD) has granted a US$100-million concessional credit line to the Bank for Investment and Development of Vietnam (BIDV) with an aim of encouraging green investments in renewable energy and energy efficiency areas.
|Fabrice Richy, Director of the Agence Française de Développement (AFD) in Vietnam and Le Ngoc Lam, BIDV’s CEO (L)|
This agreement was signed on May 26 between Fabrice Richy, Director of the Agence Française de Développement (AFD) in Vietnam and Le Ngoc Lam, BIDV’s CEO.
Fabrice Richy, Director of AFD Vietnam said: “This credit line to BIDV is our first SUNREF fund in Vietnam, in the form of a non-sovereign concessional loan.”
SUNREF is a green finance label deployed by AFD with 70 partner banks in 30 countries.
AFD hopes to continue providing concessional loans and grants to Vietnamese banks and state-owned enterprises to contribute to green growth and climate change’s adaptation in Vietnam, he said.
AFD will provide EUR300,000 (US$366,000) technical assistance (TA) to support the transition of BIDV towards a green banking model, in which it will focus on the development of a green portfolio, capacities and expertise related to environmental and social risk management.
Le Ngoc Lam, BIDV’s CEO said the agreement will be a step forward and pave the way to new partnership opportunities between parties in different sectors.
“It reaffirms the fact that application of international standards on the green credit will help BIDV improve its operational efficiency and control credit risks strictly,” Lam said.
The Vietnamese government is committed to improving its energy mix and integrating a greater share of renewable energy, in line with the objectives set in its Nationally Determined Contribution (NDC) and under the Paris Agreement on Climate Change.
Established in Vietnam in 1994, AFD has financed more than 90 projects worth almost 2.3 billion euros in various sectors including transport, infrastructure, energy, and agriculture. In line with French cooperation priorities in Vietnam, FAD is positioning its operations to support the implementation of the Paris Agreement on climate change mitigation, adaptation, and finance.