During French President Emmanuel Macron’s official visit to Vietnam, two financing agreements were signed between Vietnam’s Ministry of Finance and the French Development Agency (AFD)

Under the deal, signed in Hanoi on May 26, the AFD will provide a €27.095 million ( $29.3 million) sovereign loan to support integrated water resource management in Ninh Thuan, alongside an additional €1.7 million ($1.84 million) grant for technical assistance. Of the grant, €1.5 million ($1.62 million) is sourced from the European Union’s WARM Facility, with the remaining €200,000 ($216,000) contributed by AFD itself.

Ninh Thuan province, the driest locality in Vietnam, receives just 700–800 mm of rainfall annually, mainly concentrated between September and November. Recurring droughts have placed severe pressure on agricultural output, drinking water supplies, and local livelihoods, issues further exacerbated by climate change. The province has declared states of emergency multiple times in recent years.

The new funding will help finance the construction of a 14.5-km pipeline connecting the Song Than and Lanh Ra reservoirs, aiming to ensure a stable water supply for 270,000 residents, irrigate 8,800 hectares of farmland, and support urban and industrial zones in the province’s southern region. The project also includes institutional strengthening for water management, operation, and maintenance improvements, and promotion of water-saving agricultural techniques.

H.E. Julien Guerrier, Ambassador of the European Union to Vietnam, emphasised the project’s strategic alignment with broader EU objectives. “This is a major contribution which will support the province of Ninh Thuan to adapt to climate change, and contribute to Vietnam’s green transition,” he said. “It is well aligned with the EU’s Global Gateway strategy and exemplifies the values of the Team Europe partnership with Vietnam.”

Echoing this sentiment, Olivier Brochet, Ambassador of France to Vietnam, remarked “Through this flagship project, France reaffirms its support for a just climate transition and more resilient territories. AFD is mobilising its expertise to support Vietnamese authorities in the face of growing climate challenges.”

The signing marks a significant step in the evolving strategic cooperation between France, the European Union, and Vietnam. It underscores their shared ambition to advance sustainable development and strengthen climate adaptation in vulnerable regions.