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German bank backs out of Vietnam preservation project

The sponsor of a project to preserve the Phong Nha Ke Bang reserve with world-famous caves has asked for its money back because of poor management.


German banking group KfW had pledged 12.6 million euros (US$16 million) to preserve and manage natural resources at the Phong Nha-Ke Bang National Park, a UNESCO world natural heritage site in the central province of Quang Binh, for a project that opened in October 2008.


But when it received nothing after several requests for documents relating to the project's operation in 2009, KfW on June 14 this year wrote to the provincial government asking for a refund of 200,000 of the 360,000 euros ($457,500) it had given to the project in 2009, local press agencies reported last weekend.


KfW funds were not used properly in 2009, the notes said. The project, managed by the Quang Binh Department of Investment and Planning, disbursed 114,000 euros ($145,200) from the fund but spent nearly VND6 billion ($308,400) of corresponding funds from the provincial budget.


In the notes, the German bank said the management board has been too dependent of state budget.


The bank has not announced any plan to give more money this year, which put many project activities such as expanding the park, planting and recovering forests, and building a biodiversity corridor on the verge of being canceled.


KfW said it will withdraw from the project, expected to last until 2016, unless the management capacity of local authorities is raised, the Saigon Giai Phong said Saturday last week.


During a provincial government meeting last Thursday, Nguyen Huu Hoai, chairman of the Quang Binh People's Committee, said the management board was not able to handle the "important and complicated" project.


The Phong Nha-Ke Bang National Park covers 85,000 hectares, including the oldest limestone mountain range in Asia.


Home to abundant limestone formations, the park is an ideal site for  researchers and explorers of grottoes and caves.


In 2005, British explorers discovered a new cave in Phong Nha-Ke Bang National Park, which they called the world's most beautiful and magnificent cave discovered to date.