Mekong Watch CATFISH TALES
TOPIC: EVASION THE NAME OF THE GAME: WORLD BANK PROMOTES NAM THEUN 2 DAM
(LAOS), THOUGH "NO DECISION MADE YET."
Date: 8 September 2004
EVASION THE NAME OF THE GAME:
WORLD BANK PROMOTES NAM THEUN 2 DAM (LAOS), THOUGH "NO DECISION MADE YET."
The World Bank held a Technical Workshop on the proposed Nam Theun 2 dam in
Tokyo on 3 September 2004. This was the second of a series of such
Workshops, the first held in Bangkok, and the others to take place in
Paris, Washington DC, and Vientiane. The presenters and panelists were
representatives from the Government of Lao PDR (GoL), Nam Theun 2 Power
Company (NTPC), the World Bank, and the Asian Development Bank (ADB). The
workshop was attended by approximately 100 people, most of whom were from
power companies, development consulting companies, and government agencies
in Japan. The dominant voices from the floor, however, were the NGOs.
WORLD BANK AND GOL RESPONSES TO CRITICISM
At the workshop, NGOs raised fundamental concerns regarding the proposed
Nam Theun 2 dam. The Government of Laos dodged specific questions
regarding its failure to address remaining problems of past dam projects by
repeating that, "Laos is a poor country; we have no other options." The
World Bank proved as evasive when questioned about its justifications for
supporting a project that has already brought grief to local communities
with premature logging and resettlement.
LOGGING: An NGO participant pointed out that a military-owned firm had
conducted intensive logging in the Nakai Plateau between 1993 and 1996
under the clear presumption that a dam would be built there. This resulted
in serious deforestation. A question was put to the World Bank regarding
the legitimacy of simply categorizing land as degraded after massive
logging, and then conducting the EIA. The GoL responded first by saying
the forest in the Nakai Plateau was already degraded in the 1980s. The NGO
participant brought photos showing the scale of logging that took place in
1996, however, and the GoL switched to take the offensive, saying, "we
don't understand the purpose of your question. The World Bank only got
involved in the dam in 1997; the photos are out of date." The GoL insisted
that logging on the Plateau had stopped after 1997. The Lao official also
defended the project saying that problems occurred in the past because
there was no funding for monitoring. With revenue from the Nam Theun 2,
however, the Government expects to be able to engage in more monitoring,
and future illegal logging would thus be stopped. The Government of Laos
does not seem to see the contradiction in constructing the Nam Theun 2 for
the purpose of forest conservation, in spite of the intensive logging
already done to make way for it. The World Bank did not provide a direct
response.
RESETTLEMENT: Questions were raised regarding the violation of a 1995
World Bank Aid Memoir when villagers were involuntarily resettled at the
end of 1995. The World Bank did not provide a clear response, and the Lao
Government again confused the issue insisting that the World Bank only
became involved in 1997.
LAO GOVERNMENT CAPACITY: A participant from Japan's Ministry of Finance
asked critical questions on the capacity of the Lao Government. She said,
"it is not enough to just allocate revenue from power sales to the budget
for poverty reduction. Improvement of the overall implementing capacity of
the Lao Government in financial and monetary systems should also be taken
into consideration. Will there be sufficient improvements in time for the
construction and operation of the proposed Nam Theun 2 dam?" What was the
World Bank response? "Well, they're improving." The Lao Government came
to its own defense to say that no project is without risk, and again, that
Laos is a poor country without other viable alternatives.
OTHER ISSUES: NGOs raised other concerns including problems of involuntary
resettlement prior to project appraisal, insufficient measures taken to
resolve past dam problems, governance of the Government of Laos, necessity
to disclose the Power Purchase Agreement (PPA), and the accuracy of
interpreting villagers' support for a project after their livelihoods were
lost to logging. Academics and consultants also raised some questions, but
there were no voices in clear support for the proposed project.
QUESTIONABLE SELECTION OF THE MODERATOR
The World Bank's choice of moderator for the Tokyo Technical Workshop was
baffling. The moderator was Mr. Yasunobu Matoba, former Chief Executive
Officer of the Mekong River Commission (MRC). While with the MRC, he was
known to disregard civil society and show reluctance to improve information
disclosure. During the Technical Workshop for the Nam Theun 2, his bias
against NGOs was clear.
"Follow the rules": Mr. Matoba showed no flexibility in the agenda for the
Workshop. He would not allow NGOs to introduce a statement at the
beginning of the Workshop because no time had been allocated for it in
advance. When NGOs insisted that the statement was necessary to clarify
the function of the Workshop and the understanding upon which NGOs were
participating, he repeated that there was not time, and called for NGOs to
"follow the rules." When NGOs approached Mr. Matoba during the lunch break
to explain the reason for the need for the statement, he again refused to
allocate time by saying, "participants came to hear what is on the
agenda. They didn't come to hear things like this." The fact that NGOs
were also participants, and the statement was one result of looking at the
agenda did not seem to matter. Similar rigidity in "following rules" was
not apparent, however, when project proponents spoke over the allotted time
limit.
"This is not a place for discussion": Mr. Matoba also stopped an NGO
participant from making a follow-up comment in response to a answer by a
GoL official to the same participant's question. Mr. Matoba implied that
the participant's questions had already been answered and bluntly said,
"this is not a place for discussion."
Considering that this Workshop actually was supposed to be a place for
discussion among stakeholders with greatly differing opinions, the World
Bank's choice of Mr. Matoba is indeed a concern. The criteria for moderator
and the reasons the World Bank chose Mr. Matoba for this Workshop need to
be clarified.
NGO STATEMENT--THIS IS NOT A PUBLIC CONSULTATION
To ensure that there was no mistaking this Technical Workshop for a public
consultation, four Japanese NGOs, namely FoE Japan, Greenpeace Japan, Japan
Center for a Sustainable Environment and Society, and Mekong Watch prepared
a statement to clarify this position. NGOs wanted to make this clear,
because insufficient information disclosure, lack of time to review
necessary documents, and lack of opportunity to input in the agenda
foreclosed calling this a consultation. The statement also called for
confirmation from the World Bank that no decision on funding had been made.
In response to the statement, the World Bank agreed that the Technical
Workshop was not a public consultation. The Bank officials also said that
this Workshop would not be a one-off event, and that NGOs would have future
opportunities to provide feedback for the Nam Theun 2 project. The Bank
reassured participants that the aim of the workshop was to collect opinions
from various stakeholders, and was not a place to support the project
proponents. While NGOs are aware that the World Bank Board of Directors
has yet to make a decision, the fact that the World Bank was working
together with the Lao Government and NTPC in a Workshop where all panelists
spoke positively about the proposed NT2 dam remains a concern.
A PUBLIC RELATIONS EXERCISE?
The World Bank posted a news release on its website after the Tokyo
Workshop. Comments by NTPC and the Government of Laos take up one third of
the summary, while the NGO comments and concerns that dominated the
discussions were given a line or two. The aim of the workshop was
purportedly to listen to the opinions from various stakeholders, but its
summary publicizes primarily the reasons why proponents support the Nam
Theun 2 dam.
It seems that officials at the World Bank already see the construction of
the Nam Theun 2 dam as a given. The Workshop was presented as an
opportunity for NGOs to point out areas for improvement to make it a better
project. There was no space to discuss fundamental flaws in the process
behind the project and its legitimacy in and of itself. While the World
Bank officials said that no decision will be made until the Board of
Directors decides, it is clear from the way the Workshop was held that the
World Bank is already a strong project proponent. This is further cause
for concern-whether the Bank's Board will make an objective decision on
financing for the Nam Theun 2 remains to be seen.
WHAT IS THE NT2?
The Nam Theun 2 dam is an internationally controversial large dam project
which the World Bank is considering for funding. It is expected to
relocate approximately 6,000 people and impact the livelihoods of 100,000
more. The reservoir will flood a large area which is now habitat for Asian
elephants and other endangered species. The budget of the project is 1.2
billion dollars, equivalent to 70% of the GDP of Laos. Seventy percent of
revenues are expected to come from overseas donors, and whether or not
enough financing can be assembled depends largely on the decision by the
World Bank. If the World Bank does make a final decision to finance the
project, it will provide a "stamp of approval" which will encourage private
banks charging high interest rates to invest in already heavily indebted
Laos. In addition to the environmental and social risks, the project also
brings great economic risks.
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