Vietnam Climate Change Development Policy 3

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The Third Climate Change Development Policy Operation Program (DPO3) aims to support the Government of Vietnam (GoV) in its efforts to address climate change by adopting policies and strengthening institutional capacity to promote climate resilient and lower carbon intensity development. It is the third of a series of three operations of an amount ofUS$70.0 million equivalent. Vietnam has witnessed impressive economic growth and poverty reduction in the past 25 years. Political and economic reforms have transformed Vietnam from one of the poorest countries in the world, with per capita income below US$100, to a lower middle-income country within a quarter of a century. In 2012, Vietnam's per capita income was estimated at US$1,755. Using a 'basic needs' poverty line initially agreed in 19982, the poverty headcount fell from 58 percent in the early 1990s, to 14.5 percent by 2008, and is expected to be well under 10 percent by 2014. The country has attained five of its ten original Millennium Development Goal targets and likely to attain two more by 2015. Reforms in the early nineties contributed to major competitiveness gains, which enabled a structural shift from agriculture to manufacturing and services. Investments in physical capital and human resources led to increased capital and labor productivity. Vietnam's membership of the Association of Southeast Asian Nations (ASEAN) and the World Trade Organization (WTO) in 1995 and 2007 respectively, and a series of bilateral trade agreements, promoted reforms and led to higher private and public sector investments.