Institutional Strengthening and Capacity Building for Urban Development in Vietnam (ISCB)


Over the last three decades of economic growth, urbanization has been accelerating rapidly in Vietnam and this trend is set to continue. The level of urbanization is expected to rise from 33% in 2014 to 50% by 2030. Cities are major drivers of economic development and growth in Vietnam, as about 70% of GDP is generated in urban areas. Urban development has become an important priority for the Vietnamese government. The main challenges facing the urban sector arise from the absence of linkages between sectoral policies and urban policies, master plans and special plans. Efforts have been made to address shortcomings in urban planning and management, such as the drafting of the National Urban Development Strategy, formulating the New Planning Law and the Law on Urban Development and Management.

The new urban planning law encourages decentralization of urban planning responsibility to include all government administration levels and to require stakeholder consultation with respective organizations, individuals, and communities. However, a major challenge is the lack of capacity of local authorities to plan and manage urban growth in an integrated manner, plan and operate urban infrastructure, and efficiently deliver municipal services. While policy changes have been made to promote decentralization, institutional reforms and local capacity development have not kept pace. 

Vietnam’s urban development sector incorporates a range of responsible agencies at the national, provincial, and municipal levels. The central government ministries involved in urban sector planning and development are: Ministry of Construction (MOC) which is the line ministry for urban development, Ministry of Planning and Investment (MPI) which allocates state budget, approves all major investment projects, and prepares the country’s socio-economic development plans (SEDPs), Ministry of Finance (MOF) disburse funds through the state budget to sector projects, Ministry of Natural Resources and Environment in charge of land-use planning and manages water resources, water use, and pollution. Ministry of Transport manages roads, expressways, railways, and other transport facilities in urban areas. The Ministry of Construction (MOC) as the focal ministry for urban development and operates urban work, both policy and operational through its line agencies such as Urban Development Agency and Academy of Managers for Construction and Cities (AMC)


The overall objective of the project is to strengthen capacities of national and local institutions to promote, plan and implement innovative and participatory solutions for urban development in Vietnamese cities.

Project Outcomes

  1. Capacity of national and sub-national authorities to drive sustainble urban development improved.
  2. Policy and legal frameworks promote integrated and participative urban planning and management.
  3. Pilot projects contribute to the introduction of innovative approaches, promoting cross-sectoral strategic planning and participatory urban development

Donors and Key Project Stakeholders


Swiss State Secretariat for Economic Affairs (SECO)

Key Project Stakeholders:

Ministry of Construction (MOC), Urban Development Authority, Academy of Managers for Construction and Cities under the MOC, Department of Planning Management of the Ministry of Planning and Investment, Institute for Urban Development Management (IUDM), Participating cities in Vietnam

Relevant Links

Ministry of Construction: Institutional strengthen and capacity building for sustainable urban development in Vietnam

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