Finding 7. Resource mobilization: UNDP has successfully addressed its funding challenges as Viet Nam attained middle-income country status. However, government cost-sharing still remains a key challenge. Viet Nam transitioned to a lower middle-income country in 2010, and graduated from International Development Association concessional loans in 2017. This significantly changed Viet Nam’s international financing architecture, with several established bilateral donors moving funding away from the country. This brought resource challenges for United Nations agencies, in particular a decline in UNDP core resources (see Figure 4), which triggered the need to consider non-traditional financing for the overall programme implementation during the CPD under review. UNDP has, despite the lack of government cost-sharing, carefully managed the decline in hybrid and grant-funded ODA to stay on course with its planned programme delivery in the country. During the current CPD, the country office had planned for $133 million expenditure across the three outcomes, which includes $23.3 million of regular resources and $110 million from other resources such as vertical funds and donor agencies. While there have been challenges with the estimated allocation of core resources (about $9.2 million), UNDP has been roughly on track with non-core resources,
mobilizing an estimated $70 million at the time of the ICPE against a $110 million target.89 The country office estimates a total delivery of $104 million for the 2017-2021 CPD.90 While UNDP core funding has reduced sharply during the CPD, the mobilization of non-core resources has steadily increased, partly due to the country office ability to secure resources from GEF and GCF, as well as attracting new donors such as the Republic of Korea, Australia, Norway, the United States and the EU.91 Funding has been a particular challenge for the poverty and equality programme, which seems to have impacted the economic policy advisory work, as well as the continuation of some projects and the sustainability of key results. Although development cooperation partners have gradually phased out their projects, especially their support to governance components, UNDP has been successful in securing agreements from several others in this area. For example, UNDP was successful in securing funding from Ireland and Australia (PAPI project); KOICA (Mine Action project in Quang Binh and Binh Dinh provinces); the EU (justice); the United States Department of State (criminal justice and anti-trafficking); and Norway (human rights). The country office also receives some funds from regional projects, which include those with funding from the UK (anti-corruption), Sweden (business and human rights) and Citibank (Youth Co-lab).
FIGURE 4. Core vs non-core expenditures (US$ million) 2017
$3.4
2018
$1.1
2019
$1.3
2020
$0.8 Core
89 90 91
$11.4 $17.4 $21.5 $12.7 Non-core
UNDP ATLAS, 18 Nov 2020. Country office Resource Mobilization Strategy, July 2020. CPD 2014-2017 (Outcome 1 - 39 million, Outcome 2 - 75 million and Outcome 3 - 23 million).
CHAPTER 2: FINDINGS
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