Ensuring Climate Resilience and Sustainable Urban Development in Bac Kan

February 24, 2022

The final report workshop held on 17 February 2022 brought to a successful conclusion the CDIA-supported project preparation study (PPS) on Urban Development and Climate Resilience Project in Bac Kan (Viet Nam). Through the PPS, an estimated €25 million worth of infrastructure investment and capacity building program was developed to build Bac Kan’s infrastructure and capacity to become a sustainable and climate-resilient city.

Agence Française de Développement (AFD) and the European Union (EU), which funded the PPS, are expected to provide downstream financing for the investment project.

“As Bac Kan prepares itself in the coming years, and especially on account of looming climate change threats, continuous investment on its infrastructure is crucial to becoming livable, resilient and economically competitive,” says Ramon Abracosa, CDIA Program Manager who managed the PPS.

Bac Kan City is located along the Cau River in a mountainous region in Northern Viet Nam. While it is endowed with beautiful natural assets, the same assets bring flood and erosion risks, which are expected to worsen with climate change. Underperforming urban infrastructure and poor service provision, drainage problems and pollution from wastewater and solid waste further undermine the fulfillment of the city’s development aspirations.

The City Master Plan establishes Cau River as the focal point of city life, the heart of Bac Kan. To realize its potential, the government must address pollution, improve its aesthetic qualities and improve its riverbank facilities.

Through the PPS, CDIA supported the provincial and city governments of Bac Kan to formulate a plan and prepare to preliminary engineering design level the infrastructure component of the project amounting to €22 million. The infrastructure investment will cover riverbank strengthening and landscaping on Cau River, and channel reconstruction and sewerage works on Nong Thuong and Pa Danh streams. It will also include flood relief diversion culvert from Nong Thuong stream to the Cau River, construction of two weirs on Cau River, and reshaping of 6-km along the Cau River. CDIA proposed a combination of gray engineering and nature-based solutions for these investments to optimize their potential to improve climate resilience and livability in Bac Kan.

“The investments are key to addressing the development problems in Bac Kan,” says Ramon. “They will reduce flooding, soil erosion and pollution, as well as their accompanying health risks and environmental degradation. They will also provide recreation and climate co-benefits, and enhance the river as Bac Kan’s focal point.”

CDIA also developed a capacity development roadmap to support the sustainable implementation and operation of the investments, and the long-term prospects for urban development and management. The roadmap has a strong gender element, with women participation promoted in community-based disaster risk management, and capacity strengthening activities.

AFD is expected to provide a concession loan of €18 million to the Government of Viet Nam; and together with the government’s counterpart contribution will cover the investment works. Alongside infrastructure investments, EU’s Water and Natural Resources Management (WARM) Facility is expected to provide a €1.5 million grant to implement key aspects of the roadmap.

Results of the economic analysis show that the proposed project is economically viable. In fact, the resulting Economic Internal Rate of Return (EIRR) of the project is 14.4%, which exceeds the required minimum rate of 9%. Its tangible economic benefits include avoided health costs from the sewerage, avoided flood damages and increased protection from erosion, increased revenues from tourism and increase in land prices.

“The city offers a natural and environment-friendly atmosphere,” says Ramon. “To draw in tourists and businesses, however, Bac Kan needs to have high-quality infrastructure; and it must continuously protect its environment and enhance its livability attributes.”

“We are thankful to our consulting team, our Vietnamese counterparts, AFD and EU partners and all other stakeholders who have worked with us to create an investment project that will help Bac Kan achieve its development aspirations,” says Ramon.

More photos during the final report workshop: