Mekong at Risk: Report Damns Plans to Make Laos the “Battery of Southeast Asia”

International Rivers
Wednesday, September 24, 2008

Report recommends moratorium on damming Mekong mainstream, life-of-project payments to the poor, transparent basin-wide planning, enforcement of environmental laws and exploration of economic alternatives.

VIENTIANE, LAOS – An 88-page report released today by International Rivers chronicles the social and environmental debt created by river-rich Laos’ unprecedented dam-building boom. Environmental scientist Dr. Carl Middleton, International Rivers’ Mekong Program Coordinator, will present the report to government and donor representatives today in Vientiane, the Lao capital, at an official consultation on the Mekong River Commission’s Hydropower Program.

Power Surge appeals to the Lao government and donor agencies to:

1) explore economic alternatives to hydropower;
2) designate the Mekong mainstream off-limits to dam development;
3) impose a moratorium on new hydro projects until basin-wide plans are in place;
4) enforce Laos’ environmental laws; and
5) for dams that proceed, share hydro benefits through life-of-project payments and service provision to all affected people, up and downstream.

Laos – an opaque, one-party state – has declared it a national priority to catalyze the country’s development through the rapid construction of large dams that export high-risk hydropower to neighboring Thailand and Vietnam. With six big dams already in operation, seven currently under construction, at least 12 more in the works and development deals pending on another 35, Laos’ flood of hydro projects will monopolize the Mekong at the expense of other vital uses.

Power Surge’s 11 in-depth case studies reveal that Lao villagers are being sold down the river in hydro deals that take their fertile farmland and river fisheries, leaving them without critical sources of food and income. The people of Laos are among the poorest in the region; about 80% are farmers and fishers who have few other means to meet their basic needs and earn a living.

“Big dams don’t develop Laos; they destroy invaluable rivers and resources upon which Lao people depend for daily survival,” says Shannon Lawrence, Lao Program Director for International Rivers and editor of the report. “Poverty reduction initiatives that support rural communities and promote government accountability need to be prioritized and scaled-up.”

According to the report, dam deals appear to be made on a first-come, first-served basis with interested companies, most of which are based in Thailand, China, Vietnam, Russia and Malaysia. The Lao Water Resources and Environment Agency lacks the authority to compel dam developers to pay for the social and environmental costs of their projects or to enforce local law. Laos’ biggest hydro project under construction, the French-led Nam Theun 2, has fallen short of promises made by the World Bank and the Asian Development Bank that it would set a new sustainability standard for Lao dams.

One of the most destructive dams highlighted in the report is the proposed Don Sahong Hydropower Project, which would be the first dam built on the lower Mekong River mainstream, one of the six that Laos is proposing. The dam would block the main channel passable year-round by fish migrating between Cambodia, Laos and Thailand.

”Mekong mainstream dams - like Don Sahong - would be a tragic and costly mistake. For only 360 megawatts of electricity, Don Sahong would devastate fisheries that are central to people’s food security and the wider economy and undermine the region’s growing tourism potential. In a region where wild-capture fisheries are valued at US$2 billion per year and are of critical importance to riparian communities, these dams simply don’t add up,” says Dr. Middleton.

The Mekong River Commission is a river basin management organization directed by the governments of Cambodia, Laos, Thailand and Vietnam and funded by donor governments such as Australia, Denmark, Finland, Germany, Japan and Sweden. Middleton will make a presentation to the Commission challenging the dam industry’s business-as-usual approach in Laos and the wider Mekong Region. International Rivers is also sending the report and recommendations to other international institutions involved in Laos’ hydro boom including the World Bank and the Asian Development Bank.

Supporting statements

“Big dams are risky business for the people of Laos, and for investors. If companies are going to build dams in a one-party state with no free press and little transparency, they have to take extraordinary measures to make sure that environmental and social standards are met. This is the cost of doing business in places where people’s rights are not adequately protected by the rule of law. Dam-affected people must be guaranteed compensation for their losses as well as given a direct share of project benefits.” – Shannon Lawrence, Lao Program Director, International Rivers

“A healthy Mekong River is priceless. It is not simply the provider of economic commodities such as fish, irrigation water, and hydroelectricity. It is also the lifeblood of the region, its history and inspiration. Instead of choking the Mekong with dams, it is time that this tired old development model is replaced with one that celebrates the region’s rich cultural and ecological inheritance.” – Dr. Carl Middleton, Mekong Program Coordinator, International Rivers

"The recent mushrooming of hydroelectric projects in Laos and the wider
Mekong Region has very significant implications for the Mekong, its tributaries and - most importantly - the people whose lives and livelihoods depend on these rivers.  This report is a timely warning of the human and environmental catastrophe that lies ahead if lessons of the past are thrown to the wind." – Professor Philip Hirsch, Director, Australian Mekong Resource Centre, School of Geosciences, University of Sydney

“The environmental impacts of dams constructed on rivers around the world are well-documented. But in the case of Laos, the impacts are especially severe and present a dire scenario of water quality degradation, irreversible ecological damage and unnecessary human suffering.  At a time when global water resources are being pushed to the maximum, we see dam projects in Laos producing increased levels of greenhouse gases, an unnecessary loss of valuable fish species, toxic blooms of bacteria that poison the water, and the real threat of unnecessary human suffering from increased waterborne disease.“ – Dr. Guy Lanza, Professor of Microbiology and Director, Environmental Science Program, University of Massachusetts-Amherst

Supporting facts

2007 Gross Domestic Product (GDP) of Laos: US$4 billion
Source: World Bank, World Development Indicators database, revised 10 September 2008.

2007 population of Laos: 5.86 million
Source: World Bank, World Development Indicators database, revised 10 September 2008.

Estimated commercial value of Mekong River Basin fisheries: US$2 billion
Source: Mekong River Commission. “Annual Report of the MRC Programme for Fisheries Management and Development Cooperation,” April 2004 - March 2005.

The Mekong River provides fish, drinking water, irrigation and transport for more than 60 million people in the lower Mekong basin. Known as the “Mother of Waters,” the Mekong River supports one of the world's most diverse fisheries, rivaled only by the Amazon and the Congo.
Source: Mekong River Commission, “Regional Cooperation Programme for Sustainable Development of Water and Related Resources in the Mekong Basin,” October 2005; WWF, “World's Top Rivers at Risk,” March 2007.

Fish consumption is Laos is estimated to be more than 200,000 tonnes per year or more than 40 kilograms per person per year.
Source: Van Zalinge N., P. Degen, C. Pongsri, S. Nuov, J. Jensen, V.H. Nguyen and X. Choulamany, “The Mekong River System,” p. 333-355 in R.L. Welcomme and T. Petr (eds.) Proceedings of the Second International Symposium on the Management of Large Rivers for Fisheries, Vol. 1. FAO Regional Office for Asia and the Pacific, Bangkok, Thailand, 2004, as cited in WorldFish Center, “Values of Inland Fisheries in the Mekong River Basin,” 2007.

“Subsistence agriculture [in Laos], dominated by rice, accounts for about 40% of GDP and provides 80% of total employment.”
Source: CIA, The World Factbook- Laos, September 2008.

Laos has 18,000 megawatts of exploitable hydropower potential, less than 5% of which has been developed.
Source: DANIDA, “Environmental Problems of The Energy Sector,” presentation to DANIDA Natural Resources and Environment Program, Vientiane, 2001.

Electricity exports currently account for about 10% of total Lao exports.
Source: World Bank, “Lao PDR: TA for capacity development in hydropower and mining sectors,” Project Information Document, August 2008.

Agriculture makes up the largest share of Laos’ 2006 GDP, or approximately 42%, followed by the industrial sector at 32.5% (which includes hydropower and mining), and the service sector with 25.5%.
Source: World Bank, “Lao PDR: At a Glance,” September 2007.

“Diversifying sources of growth and generating employment remain major challenges [for Laos]. Since hydropower and mining have only a limited capacity to create employment, expansion of agriculture remains the key to raising incomes and employment. ... A 2007 poverty assessment noted that a major cause of poverty in the country is diminishing access to cultivated land.”
Source: Asian Development Bank, Asian Development Outlook 2008.

Experts available for comment

Professor Philip Hirsch
Director, Australian Mekong Resource Centre
School of Geosciences, University of Sydney
Tel +61-2-9351-3355

Dr. Phil Hirsch directs the Australian Mekong Resource Centre and is an internationally recognized expert on river basin management, natural resource governance, and environment and rural development in Southeast Asia.

Martin Stuart-Fox
Professor Emeritus
The University of Queensland
Tel: +617 3202 6926

Martin Stuart-Fox can speak on the broader political and social context of Laos. He is Emeritus Professor at the University of Queensland, Australia. He has written six books and more than fifty articles and book chapters on Lao politics and history.

Professor Guy R. Lanza
Professor of Microbiology
Director, Environmental Science Program
University of Massachusetts- Amherst
Tel: +1-413-545-4945

Dr. Guy Lanza directs the Environmental Science Program at the University of Massachusetts-Amherst. He has reviewed the Environmental Impact Assessments of several Lao hydropower projects and is an expert in the areas of water quality, ecology and waterborne disease.

Dr. Richard Cronin
Senior Associate
Henry L. Stimson Center
Washington, DC USA

Dr. Richard Cronin heads the Southeast Asia program at the Henry L. Stimson Center and is available to address political economy issues in the Mekong region and the socioeconomic impact of hydropower development.

Media contacts: 

Paul West, +1 541/499-5951, Skype: PaulCWest, (US)
Shannon Lawrence, + 216 23 456 969, Skype: shanlaw72, (Tunisia)
Carl Middleton, 856 20 501 2836 (until Oct 2), +66 84 681 5332 (after Oct 2),