ADB's Dam-Building Record "Seriously Deficient"

Thursday, May 8, 1997

A report released today by International Rivers documents the Asian Development Bank's dam-building activities in the Mekong watershed. The report, released to coincide with the ADB's 30th anniversary meeting in Fukuoka, Japan, states the ADB has been "seriously deficient" in quantifying and even recognizing the impacts of the dams it has funded in the region.

The report calls for the Bank to impose a moratorium on all funding for energy projects in the Mekong region until it has studied renewable energy and energy efficiency options.

Bank-financed studies have identified the potential for over 50 large dams on the Mekong River and its tributaries. The ADB has conducted feasibility and engineering studies, has directly financed projects, and has mobilized resources from other aid donors and the private sector.

According to the report, the ADB:

  • is failing to adhere to its own policies in the Mekong region, particularly those on energy, public participation and consultation;
  • is subsidizing private companies vying to build dams in the region as hydropower projects are uneconomic for the private sector without public assistance;
  • has failed to recognize the impacts of dams on the rivers, fisheries, forests and livelihoods of local communities, and has failed to provide adequate compensation for those affected;
  • has used consultants to conduct feasibility studies, environmental impact assessments and basin studies who consistently exaggerate the benefits of dams and downplay their costs;
  • has failed to respond adequately to criticisms of its dam projects and continues to downplay their impacts.

The report makes a number of detailed recommendations on existing and proposed projects. International Rivers, together with representatives from other non-governmental organizations, will be presenting these recommendations to Bank staff and Executive Directors in Fukuoka.

Non-governmental organizations in Japan and from the Asia-Pacific region are planning a series of activities to coincide with the 30th anniversary meeting of the Asian Development Bank's Board of Governors in Fukuoka, Japan, from May 9-13. The focus for the activities will be "Questioning the ADB at 30."

For Further information:
Satoru Matsumoto, Mekong Watch Network, Japan +81 92 846 8585

The ADB's Role in Dam Building in the Mekong

The Asian Development Bank is a key player in the push to build dams in the six countries of the Mekong watershed. The Bank-financed energy sector study for the region has identified the potential for over fifty large dams on the Mekong River and its tributaries. A number of these have been approved and are under construction, others are in the pipeline. Yet many projects are proceeding on the basis of feasibility studies and environmental impact assessments that ignore or dismiss the impacts of these projects on the rivers, forests and livelihoods of local communities in the region.

The Bank is basing its dam-financing activities on the energy sector study conducted by Norwegian hydropower consultants Norconsult in 1994. The outcomes of the study reflect Norconsult's hydropower bias, recommending a series of dams and transmission interconnection projects for the region. There is no assessment of the potential for renewable energy or energy efficiency in the region, contrary to Bank policy. Despite these flaws the Bank is steadily implementing the recommendations of the Norconsult study.

To date, the Bank has financed the following dam projects and studies in the Mekong watershed:

  • Xeset Hydropower Project in Lao PDR ($19.5m, approved 1984)
  • Nam Song Hydropower Project in Lao PDR ($31.5m, approved 1992)
  • Nam Theun-Hinboun Hydropower Project in Lao PDR ($60m, approved 1994)
  • Nam Leuk Hydropower Project in Lao PDR ($52m, approved 1996)
  • Xe-Kong/Se San and Nam Theun River Basins Hydropower Development Study ($2.5m, approved 1996)
  • feasibility study for the Phuoc Hoa Multipurpose Water Resources Project in Vietnam ($600,000, approved 1996)
  • Stung Chinit Water Resource Development Study in Cambodia ($800,000, approved 1996)

In the next 3 years, the Bank is considering financing the following projects:

  • Phuoc Hoa Multipurpose Water Resources Project in Vietnam ($80m, 1998)
  • Two power transmission and distribution projects in Vietnam ($225m, 1997)
  • A hydropower project in Vietnam ($150 million, 2000)
  • a feasibility study for the Sekong 5 Hydropower Project in Laos in1997, and possibly a loan for construction in 1999
  • Nam Mang 3 dam and diversion project in Laos ($15m, 1998)
  • a prefeasibility study of a hydropower project in 1998 in Cambodia, followed by a loan at a later stage.

The ADB has been seriously deficient in quantifying and even recognizing the impacts of existing projects like Nam Leuk and Nam Theun-Hinboun on local communities and has failed to provide adequate compensation. The Bank's response to criticism has been to either ignore or downplay the impacts. In the case of Nam Leuk, the Bank has established an independent Panel of Experts who are only expected to monitor the project during the construction phase and not during the actual operation of the dam. The Bank should accept responsibility for cleaning up these existing projects before financing any additional dams in the region.


Energy Sector Study

  • The Bank should finance a new energy sector study that considers all the supply and demand-side options for energy in the region. The study should be undertaken by competent, independent and unbiased consultants, and must be available for external review by non-governmental organizations, academics and other interested parties.
    • Until such a study is completed, the ADB should impose a moratorium on all funding for energy sector projects in the region.
    Theun Hinboun Hydropower Project
    • The ADB should immediately establish a fund to compensate local people for losses due to the project.

    Nam Leuk Hydropower Project

    • The Bank should establish an independent committee to determine fair compensation for affected villagers. The committee's findings should be open to review by both the villagers concerned and other interested parties.
    • The Terms of Reference for the Panel of Experts should be expanded and the Panel must have the power to make binding recommendations.

    Xe-Kong/Se San and Nam Theun Basins Hydropower Development Study

    • The ADB should assess the cumulative ecological and social impacts of the projects currently under construction or scheduled to begin soon in the Xe-Kong/Se San and Nam Theun Basins. No further projects should be proposed on these basins until a competent assessment based on empirical evidence is completed and made publicly available.

    For further information, contact:

    • Dr. Guy Lanza, (413) 545 5226,, Dr. Lanza's seven-page report is available from International Rivers