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dam-l PR: Showcase dam in Laos a loser for local people
INTERNATIONAL RIVERS NETWORK
PRESS RELEASE
Thursday April 2, 1998
Aviva Imhof
Mekong Program Coordinator
(510) 848-1155
aviva@irn.org
Embargoed until 1am Friday, April 3, 1998 Bangkok time (GMT+7)
SHOWCASE DAM IN LAOS A LOSER FOR LOCAL PEOPLE
A report released today documents the severe and uncompensated impacts
which the Theun-Hinboun Dam in Laos has had upon the livelihoods of
thousands of local people.(1) The project is to be officially opened at a
dam-site ceremony this Saturday, April 4. Asian Development Bank President
Mr Mitsuo Sato is expected to attend the ceremony.
The Asian Development Bank (ADB) is the main backer of the 210-megawatt
Theun-Hinboun hydropower project, the first large dam to be completed in
Laos since 1972. The ADB has recently described Theun-Hinboun as a "winner"
with "little for the environment lobby to criticize".(2) Yet a recent visit
to the project area by an independent researcher, Bruce Shoemaker, has
shown that local villagers are experiencing various harmful impacts,
including serious drops in fish catches, the loss of riverbank vegetable
gardens and drinking water sources, and transportation difficulties.
The researcher, who is a fluent speaker of the Lao language, interviewed 60
people in 10 villages during a visit to the project area in early March
1988. Interviewees included women and men, fish-stall owners, shop owners,
fishermen, village headmen, boat pilots, and others.
"What was particularly striking about the interviews with the villagers,"
says the report, "was that they all reported various harmful effects from
the project. In all three areas visited, villagers reported substantial
declines in fish catches. These declines ranged from 30% to 90%." Local
people are heavily dependent on fish as a source of food and income.
The ADB claims that with Theun-Hinboun there is "no flooding, virtually no
reservoir, and no need to resettle anyone." Interviews with villagers
living around the reservoir, however, reveal that riverbank gardens which
provide both essential food and income have been flooded and eroded. An
entire village of over 100 households living below the dam has been
informed that they will have to move because of the increased threat of
flooding.
Within the $260 million project cost, only $50,000 has been allocated for
compensation costs. Two-thirds of the total mitigation budget of $2.59
million went towards structural modifications of the dam. In October 1996,
the Lao government, acting with legal advice from the ADB, signed a license
agreement with the Theun-Hinboun Power Company (THPC) which absolved the
company from any further obligation to assist with mitigation or
compensation measures for the life of the project.
"The ADB and NORAD must be held accountable for the mess they have
created," says Ms. Aviva Imhof, Mekong Program Coordinator for
International Rivers Network." They should ensure that local people are
fully compensated for all their losses so that Lao citizens do not
subsidize the profits of foreign investors. A first step would be for these
agencies to sponsor an independent examination of the impacts of the project."
THPC is a joint venture between the Lao electricity utility, EdL, a Thai
company, GMS-Thailand, and two Nordic state-owned utilities, Vattenfall of
Sweden, and Statkraft of Norway. The Norwegian aid agency NORAD gave a
grant of $7 million for the project. The ADB contributed a loan of $60
million. Although the ADB claims that the project is "the first privately
financed infrastructure in Lao PDR", well under half of the total
investment comes from purely private sources.
Theun-Hinboun is a short distance downstream from the much bigger Nam Theun
2 Dam which the World Bank is currently preparing to fund. Ms Imhof says,
"the serious and uncompensated impacts of the relatively small
Theun-Hinboun project indicate that if Nam Theun 2 is built it will
severely harm the livelihoods of many thousands of people".
- 30 -
1. Bruce Shoemaker, Trouble on the Theun-Hinboun: A Field Report on the
Socio-Economic and Environmental Effects of the Nam Theun-Hinboun
Hydropower Project in Laos, April 1998.
2. Ian Gill, 'Theun-Hinboun gamble pays off: Hydropower project to increase
Lao PDR's GDP by 7 percent', ADB Review, Nov/Dec 1997.
For a copy of the full report or further information, please contact:
Aviva Imhof +1 510 848 1155 (office) +1 510 499 9778 (mobile)
The report will be posted on IRN's web site after embargo - www.irn.org.
Photos are also available upon request.
International Rivers Network is a non-profit organization which promotes
the rights of communities around the world affected by river development
projects.
INTERNATIONAL RIVERS NETWORK
1847 Berkeley Way, Berkeley, California 94703, USA
Tel: (510) 848-1155 / Fax: (510) 848-1008 / irn@irn.org / www.irn.org
_____________________________________________________
Trouble On The Theun-Hinboun
A Field Report on the Socio-Economic and Environmental Effects of the Nam
Theun-Hinboun Hydropower Project in Laos
Executive Summary
The Theun-Hinboun hydropower project, a $260 million dam on the Theun River
in Laos, is opening on April 4 1998. The dam was completed this year with
financing from the government of Norway, the Asian Development Bank (ADB),
and other public and private sources. But as the ADB and the project
developers continue to trumpet the project's success, thousands of
villagers are experiencing severe impacts to their livelihoods. Bruce
Shoemaker, an independent researcher who lived in Lao PDR for seven years,
recently visited the area.
The researcher interviewed 60 people in 10 villages on a three day visit to
the project area in early March 1998. These interviews encompassed a wide
cross section of people in the area including women, men, young people,
fish market stall owners, shop owners, fishermen, village headmen, boat
pilots, and others.
What was particularly striking about the visits to villages in the project
area--whether downstream in the Nam Kading, downstream in the Hai/Hinboun,
or along the headpond--was that without exception they ALL reported
experiencing various harmful effects from the project. In all three areas
visited, villagers reported substantial declines in fish catches. These
declines ranged from 30% to 90%. Villagers also reported being impacted by
the loss of riverbank vegetable gardens, the loss of dry season drinking
water sources, and transportation difficulties. In some areas, villagers
must relocate their homes and do not feel they are receiving adequate
assistance with this process.
The researcher also found that the thousands of Lao citizens now suffering
harmful impacts from the Theun-Hinboun project are not receiving direct
compensation for their losses and there are no plans to provide them with
any such compensation in the future. Within the entire $260 million dollar
project cost--which includes $2.59 million for a mitigation program--a
total of only $50,000 has been allocated for all resettlement and
compensation costs for affected local people. In fact, 67 per cent of the
total mitigation budget went towards a re-regulating pond and modifications
allowing for a downstream flow in the Theun River, costs which arguably
should have been included as part of the project's basic infrastructure
from the start. In October 1996, the Lao government, acting with legal
advice from the ADB, signed a license agreement with the THPC which
absolved the company from any further obligation to assist with mitigation
or compensation measures for the life of the project.
Rather than addressing these issues, the ADB and the Theun-Hinboun Power
Company (THPC) are trumpeting the project's success and refusing to
acknowledge that these negative impacts on people's livelihoods are even
occurring. No independent verification of whether even the small amounts
of compensation now being provided are in fact reaching those affected
more over…
has been made. No systems are in place to properly document the economic
losses caused to local people. The THPC does not appear to even be making
a sincere effort to discover what the real situation is in villages
affected by the project.
A first step in addressing the concerns mentioned above might be for the
project's public financiers--NORAD and the ADB--to sponsor an extensive and
comprehensive independent examination of the points that have been raised
in this field report. Such an examination could be the initial stage in
providing redress to those Lao citizens currently being harmed by the
project. As these harmful impacts are being experienced right now to
people with extremely limited economic reserves or alternatives, this
process should occur as quickly as possible.
It is clear that the company should take responsibility for their share of
the true costs of the project, costs that were ignored or downplayed by a
consultant company owned by one of the outside shareholders during the
project formulation period. Given this poor process, there may well be a
legitimate legal argument that the concession agreement should be
renegotiated to require the foreign shareholders to pay their fair share of
the compensation costs. The ADB also bears responsibility for assisting in
resolving these problems as it has firm policies in place stating that
people should not be allowed to be left worse off than before due to the
impacts of an ADB financed project. The researcher is hopeful that the
responsible Lao government authorities, when they fully understand the
serious negative impacts occurring to many of their country's citizens,
also will want to move quickly to solve these problems and bring justice to
the affected people.
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Aviva Imhof, Mekong Program Coordinator
International Rivers Network
1847 Berkeley Way, Berkeley CA 94703 USA
Tel: + 1 510 848 1155 (ext. 312), Fax: + 1 510 848 1008
Email: aviva@irn.org, Web: http://www.irn.org
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