A power grid development sector project such as this project does not generate any
direct poverty and social impacts for the population residing in the areas impacted upon by the
project except for people who will be affected either through physical and economic
displacement or both forms of displacement. These direct impacts are dealt with in the specific
resettlement plans prepared for the core projects and if necessary will also be prepared for the
noncore projects. The reason is quite obvious because this specific sector project is focusing on
the upgrading/rehabilitation/construction of new substations and their associated facilities,
notably overhead and underground transmission lines. The project is not dealing with energy
supply to individual consuming entities (residential or non-residential) and hence issues
associated with the cost and coverage of such connections is not an issue. Nevertheless, the
project is required to recoup the investment outlay and this either has to be via direct
government subsidies or tariffs adjusted to ensure not only full cost recovery but sufficient
operating profit to maintain and expand existing electricity supply in both Ha Noi and Ho Chi
Minh.