Nam Theun 2 dam site...then and now

Nam Theun 2 Dam

In 2005, the World Bank and the Asian Development Bank approved millions of dollars in guarantees and loans for the Nam Theun 2 Hydropower Project in central Laos. The $1.3 billion project is supposed to generate revenue for the Lao government through power exports to Thailand. Project proponents claim that Nam Theun 2 revenues will be used to help the poor. But in a country ranked as one of the 20 most corrupt by Transparency International, that is a high-risk bet - especially for the tens of thousands of Laotians bearing the project's social and environmental costs.

The Nam Theun 2 Hydropower Project began full operation in March 2010. Approximately 6,200 indigenous people living on the Nakai Plateau have been resettled to make way for the reservoir. More than 110,000 people downstream, who depend on the Xe Bang Fai and Nam Theun rivers for their livelihoods, have been directly affected by the project, due to destruction of fisheries, flooding of riverbank gardens and water quality problems (see map). 

World Bank and Asian Development Bank resettlement policies have been violated, along with provisions of the Concession Agreement. People on the Nakai Plateau still have no source of sustainable livelihood, threatening their food security. Tens of thousands of people living downstream along the Xe Bang Fai River have already suffered impaired water quality and fisheries, and funding is inadequate to restore their livelihoods. A key selling point of the project was the funds it would provide for protection of the globally significant Nakai-Nam Theun National Protected Area, yet the reservoir has opened up a access to the area, exacerbating logging and poaching and threatening its ecological integrity. International Rivers is working to ensure that the developers, the World Bank, the Asian Development Bank and the Government of Laos uphold their commitments to affected people and the environment, including to the downstream communities along the Xe Bang Fai River.

Significantly, a member of the Nam Theun 2's international social and environmental panel of experts (PoE), Mr. Thayer Scudder, publicly stated in a New York Times article published in 2014 that, "Nam Theun 2 confirmed my longstanding suspicion that the task of building a large dam is just too complex and too damaging to priceless natural resources". International Rivers is monitoring the independent Panel of Experts' (POE) reports, and calling on NTPC as well as the financiers to follow through on the recommendations made towards livelihood restoration of the affected communities.

As of late 2015, the most recent POE report provides a thorough assessment of the lack of livelihood restoration achieved as outlined in the resettlement plans and the concession agreement. The report details serious concerns related to the degradation of forestry resources, the lack of viable income opportunities for the affected populations, and problems related to the lack of resources available to accommodate the natural growth of families in the resettlement areas. The response of international financiers, such as the Asian Development Bank and World Bank, along with Nam Theun 2 Power Company, to the panel's critical assessment is pending. In addition, although the Panel was scheduled to be phased out by the end of 2015, their request to extend their mandate by two years to continue monitoring the situation has yet to be granted.

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