The Asian Development Bank (ADB) and Vietnam Government have signed a $188.36m loan agreement to improve the road connectivity between Noi Bai-Lao Cai Expressway and the country’s north-western provinces.

To support the overall $236.67m project cost, the Australian Government is offering a grant of $4.48m, with $43.82m coming from Vietnam’s central budget, alongside a  $188.36m loan from ADB.

ADB first announced the loan approval in December last year.

Funds will be invested to construct and upgrade 198km of roads that connect several towns and districts in the provinces of Lai Chau, Lao Cai and Yen Bai to the Noi Bai-Lao Cai Expressway.

Forming part of the Greater Mekong Subregion (GMS) Kunming Hai Phong Transport Corridor, the road will connect the Hanoi region to the north of Vietnam, as well as to Yunnan Province in China.

“The project aims to expand the benefits of the GMS corridors to the north-western provinces.”

The road project will use climate-resilient technology such as slope protection in areas prone to landslides and rockfalls.

Upon completion, the road will provide reliable access to basic social services such as education, healthcare, job training, and emergency disaster relief.

In addition, the ADB-financed Noi Bai-Lao Cai Expressway is intended to further improve connectivity and increase the benefits of the existing expressway to people living in the north-western region.

ADB Vietnam country director Eric Sidgwick said: “The project aims to expand the benefits of the GMS corridors to the north-western provinces.

“The improved connectivity will not only boost border trade, private investment and job creation in the region, but also provide better access to basic social services, such as education, healthcare, job training and emergency disaster relief for the people of the north-western provinces, especially the poor ethnic minorities.”