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Ex-post Evaluation


1. Outline of the Project



Project title:

Project for the Improvement of Water Supply Facilities in Gia Lam Area, Hanoi City


Water Supply

Cooperation Scheme:

Grant Aid

Division in Charge:

Grant Aid Management Department

Total Cost:

3,815 million yen

Period of Cooperation

FY 1993 - 1995

Partner Country’s Implementing Organization:

Transportation and Urban Public Works Hanoi Water Business Company No.2

Supporting Organization in Japan:

Related Cooperation:


Related Cooperation:

1-1 Background of the Project

Gia Lam District in Vietnam, which is in the northeastern corner of Hanoi City beyond the Red River, was not included in the targeted area of the Hanoi City Water Supply Program, whose aim was to develop urban water supply. Although the area plays an important role as a commercial and industrial hub as well as a terminal point for land transportation for Hanoi City, it was excluded from the program because it is located beyond the Red River that runs through the city. The urban population including suburban areas in Gia Lam totaled 100,000 in 1993 and was estimated to increase to 170,000 by 2010 (as of in 1993). However, as facilities of the Gia Lam Water Treatment Plant (hereafter referred to as “the Plant”), which was responsible for supplying the water in this area, were limited and old, water services could only be provided to 15% of the population even in 1993. Under these circumstances, Hanoi City formulated the Gia Lam Water Master Plan along with the Hanoi Water Supply Program, with the aim of achieving the national target rate for urban water supply. The government of Vietnam requested Grant Aid from the government of Japan to help implement the Gia Lam Water Master Plan.

1-2 Project Overview

Grant Aid was provided to restore the water production capacity of the Plant in order to satisfy the demand for water in the target area (as of 2000).

(1) Overall Goal
1) Improved water supply coverage to 85% of Gia Lam by 2000.
2) Meeting to the demand for drinking water in Gia Lam.

(2) Project Purpose
To improve water plant capacity to 32,100 cubic meters per day.

(3) Outputs
1) Replacement of water-supply facilities and equipment at the Plant.
2) Construction of wells and aqueducts.
3) Construction of water intake facilities and intake well pumps.
4) Construction of distribution pipes.
5) Construction of an administration building.

(4) Inputs

Japanese Side:

984 million yen (1993), 65 million yen (1993), 1,512 million yen (1994), 1,254 million yen (1995)

Vietnamese Side:


2. Evaluation Team

Members of Evaluation Team

Team Leader:
Planning of Survey:

Pham Thi Thu Lan, JICA Vietnam Office
Center Sociology, Hochiminh National Political Academy

Trinh Quang Long, Central Institute for Economic Management

Do Xuan Phuong, Consulting and Research Company for Technology Transfer and Investment

Period of Evaluation

December 1 – December 31, 2002

Type of Evaluation:

Ex-Post Evaluation by Overseas Office

3. Results of Evaluation

3-1 Summary of Evaluation Results

(1) Impact
Responsibility for operation and maintenance of the water supply was transferred from the Gia Lam Water Supply Management Board (GWSMB) to Hanoi Water Business Company No.2 (HWBC No.2) in 1998. Since HWBC No.2 became a financially independent organization and is no longer run by the Hanoi City, it no longer receives subsidies from the city. HWBC No.2 has expanded its areas of coverage. In 1997, it supplied water to three towns and two communes. In 2002, its service area was expanded to include three more communes. Furthermore, in 2001, it began providing water to three wards in the inner city of Hanoi. Through such expansion, the water supply rate in the Gia Lam area reached approximately 50% (180,000 people). This is still below the target of 85% coverage planned for the year 2000. However, with rapid population growth in the Gia Lam area that has greatly exceeded former estimates, this figure can be considered significant.

The quality of water provided to the Gia Lam area has improved dramatically after 1995, and it satisfies the new standard issued by the Ministry of Health in 2002. According to the questionnaire survey carried out, all 61 respondents were satisfied with the quality of water. The good water quality is attributed to the effective technology and management skills of HWBC No.2. However, some residents indicated that they found calcium in the water, while the manager of HWBC 2 explains that that is due to the chemicals used for cleaning the water storage facilities.

By increasing water plant productivity and improving accessibility to drinking water, the lifestyles of residents in the service areas have changed. Because they have adopted the habit of using tap water for home use, they have realized the importance of clean water, and become more aware of hygiene. Certain diseases caused by unclean water have decreased. Seventy percent (70%) of the respondents of the survey answered that the water supply reduced diseases related to eyes and skin. In addition, the statistics compiled by the Ministry of Health in the Gia Lam District revealed that the number of cases of diarrhea declined from 4,440 in 1997, to 2,031 in 2002. However, it should be noted that many other factors contributed to reducing the prevalence of water-borne infectious diseases.

(2) Sustainability
Water production by Gia Lam Water Treatment Plant increased dramatically from 4,700 m3/day in 1997 to more than 30,000 m3/day in 2002. The production in 2002 had reached a level close to the designed capacity of the plant (32,000 m3/day). The water coverage in the targeted project area increased to about 90% after the completion of the project. However, Ngoc Thuy district, which was part of the project’s target, has not yet received water due to difficulties in constructing a pipeline through the railway system, and its less-than-projected demand for water.

The technology selected for this plant was suitable. For that reason, the Gia Lam water plant was estimated as one of the best-equipped water plants in Hanoi. This appropriate technique and facility have also contributed to the improvement of the quality of treated water and to reduce maintenance costs. HWBC No.2 has applied effective strategies to maintain its equipment, such as establishing a team of mechanics to carry out regular inspections of all plant facilities. In addition, it developed a training system for the staff based on their level of responsibility. HWBC No.2 has a clear strategy for managing a water system. A committee for water loss prevention was formed to be in charge of identifying any water loss, and carrying out measures to prevent future water loss in their controlled area. The leakage has been reduced from 61.5% in 1997 to 17.6% in 2002, suggesting that the HWBC No.2’s water-production management policy has been appropriate.

Secondly, HBWC No.2 received organizational support from Transportation and Urban Public Works (TUPWS). Although HBWC No.2 is given a certain level of autonomy in its management, some decisions influencing its sustainable operation, such as the selection of key company staff, are made by TUPWS. Thus HWBC No.2 is now operating under a regime that may hamper its organizational sustainability.

Meanwhile, during the first three years of operation (1997-1999), the Gia Lam Water Treatment Plant incurred small losses. However, the Plant started earning profits in 2000. The revenue from water production accounted for 60% of total plant revenue in 2001. This is expected to increase in 2002, because the Plant’s production rate has reached its maximum capacity, and the water tariff was raised by the Hanoi People’s Committee in October 2001. The current water tariff for domestic use (2,000 VND/m3, VND = Vietnamese Dong) is well below the actual cost of production (3,000 – 4,500 VND/m3). As a result, HWBC No.2 cannot rely solely on water production for making profits. As such, the company management has realized that it must look for other sources of revenue.

3-2 Factors Promoting Sustainability and Impact

(1) Factors Concerning the Planning Process

(2) Factors Concerning the Implementation Process
1) The appropriate technology applied at the Gia Lam Water Plant helped to improve the water quality and sanitary environment of the project area. Also, it helped to reduce maintenance expenses for the Plant, contributing to financial sustainability.
2) The management of HWBC No.2 was effective for running the Plant, contributing to organizational and financial sustainability, as well as to the reduction of leakage and the increase in production.

3-3 Factors Inhibiting Sustainability and Impact

(1) Factors Concerning the Planning Process

(2) Factors Concerning the Implementation Process
Regulations on dike production and railway systems are strict in Vietnam. This caused delay in construction of pipelines to Ngoc Thuy.

3-4 Conclusion

The intended impacts have been made, towards which the project contributed. The ripple effect of the project, such as the expansion of the service area by HWBC No.2, was confirmed. However, the population in the target areas has grown more rapidly than the estimate made in the project design, and HWBC No.2 is expected to expand its operations further. In terms of sustainability, although there are no problems at the moment, there are technical and financial issues of concern for the long run. In addition, to expand its service areas, external assistance may be essential.

3-5 Recommendations

A more effective water tariff system may have to be considered because HWBC No.2 is selling water at a rate lower than the cost of water production. In order to avoid strong resistance from the residents, an incremental system of tariff increase should be considered. It may also be a good idea for HWBC No.2 to pay more attention to other revenue sources, since it currently relies too heavily on water production.

3-6 Lessons Learned

Those who implement the project should pay close attention to fairness in targeting beneficiaries.

3-7 Follow-up Situation



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