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World Bank roadshow over Laos hydro-electric project returns to Vientiane
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HANOI - The World Bank's international roadshow to canvas opinion on the construction of a controversial hydro-electric project in Laos, which its backers say is key to the impoverished nation's development, moved to Vientiane Friday.
The stop in the Lao capital was the fifth and final leg of the public consultation process ahead of the May 2005 deadline for the World Bank and the Asian Development Bank to decide on whether to guarantee financing for the Nam Theun 2 power plant.These forums, which have been organized by the two banks with the support of the Lao government and the Nam Theun 2 Power Company (NTPC), are aimed at providing feedback on the 1.3-billion dollar project.
"This is not a project that we are taking lightly. We have learned from the past and are applying a more comprehensive approach in reviewing this proposed project," the World Bank said Friday in a statement. "The intensity of this effort reflects our strong desire to ensure it would deliver real, durable benefits for the people of Laos. That is the only basis on which we would support it."
Bangkok, Tokyo, Paris and Washington have all hosted similar workshops over the past few weeks to canvas the views of non-governmental organizations and other interested parties about the long-delayed project. The power plant and its 450-square-kilometre (180-square-mile) reservoir is to be built some 250 kilometres (160 miles) southeast of Vientiane on the Nam Theun, a tributary of the Mekong river which cuts across much of Indochina.
Project developer NTPC is an international consortium comprising Electricite de France International, the global arm of French state-owned Electricite de France, which has the majority 35 percent stake.The Lao government and the Electricity Generating Authority of Thailand have a 25 percent stake each, while joint venture Italian-Thai Development Public Co. Ltd. holds the remaining 15 percent.
Because the project is being financed by a combination of equity from the shareholders and international loans, it cannot viably go ahead without a partial risk guarantee for lenders from the World Bank and the ADB. Under pressure from conservation groups, the banks have laid down a series of social and environmental obligations and safeguards that must be met.
One of the project's biggest critics is the Lao Movement for Human Rights (LMHR), a group of Lao exiles in Paris. In a report issued following the September 7 consultation meeting in Paris, it dismissed the series of workshops as a means "to give good conscience to the deciders" and the communist Lao government. "It seems clear that NT2 has become a 'personal matter', a 'question of honor' or a 'symbol of prestige' for the leaders, to whom 'this dam must be built, no matter the cost'," the group said.
The cash-starved regime is bent on seeing the venture implemented as it has the potential of generating revenue of nearly two billion dollars -- the current Gross Domestic Product value of Laos -- over a 25-year period. It is also important for Thailand, which has committed itself to buying five billion dollars worth of electricity from the power project over a 25-year period from 2009 to help reduce its dependence on imported oil.
Opponents, however, have expressed concern about the social impact on the 6,200 people who will be forced to leave their homes to make way for the plant, which is intended to start generating electricity from 2009. Others concerns involve its impact on the environment, its economic rationale and the government's management of the accrued revenue.
Most analysts, however, believe that the project will receive the green light early next year.
The stop in the Lao capital was the fifth and final leg of the public consultation process ahead of the May 2005 deadline for the World Bank and the Asian Development Bank to decide on whether to guarantee financing for the Nam Theun 2 power plant.These forums, which have been organized by the two banks with the support of the Lao government and the Nam Theun 2 Power Company (NTPC), are aimed at providing feedback on the 1.3-billion dollar project.
"This is not a project that we are taking lightly. We have learned from the past and are applying a more comprehensive approach in reviewing this proposed project," the World Bank said Friday in a statement. "The intensity of this effort reflects our strong desire to ensure it would deliver real, durable benefits for the people of Laos. That is the only basis on which we would support it."
Bangkok, Tokyo, Paris and Washington have all hosted similar workshops over the past few weeks to canvas the views of non-governmental organizations and other interested parties about the long-delayed project. The power plant and its 450-square-kilometre (180-square-mile) reservoir is to be built some 250 kilometres (160 miles) southeast of Vientiane on the Nam Theun, a tributary of the Mekong river which cuts across much of Indochina.
Project developer NTPC is an international consortium comprising Electricite de France International, the global arm of French state-owned Electricite de France, which has the majority 35 percent stake.The Lao government and the Electricity Generating Authority of Thailand have a 25 percent stake each, while joint venture Italian-Thai Development Public Co. Ltd. holds the remaining 15 percent.
Because the project is being financed by a combination of equity from the shareholders and international loans, it cannot viably go ahead without a partial risk guarantee for lenders from the World Bank and the ADB. Under pressure from conservation groups, the banks have laid down a series of social and environmental obligations and safeguards that must be met.
One of the project's biggest critics is the Lao Movement for Human Rights (LMHR), a group of Lao exiles in Paris. In a report issued following the September 7 consultation meeting in Paris, it dismissed the series of workshops as a means "to give good conscience to the deciders" and the communist Lao government. "It seems clear that NT2 has become a 'personal matter', a 'question of honor' or a 'symbol of prestige' for the leaders, to whom 'this dam must be built, no matter the cost'," the group said.
The cash-starved regime is bent on seeing the venture implemented as it has the potential of generating revenue of nearly two billion dollars -- the current Gross Domestic Product value of Laos -- over a 25-year period. It is also important for Thailand, which has committed itself to buying five billion dollars worth of electricity from the power project over a 25-year period from 2009 to help reduce its dependence on imported oil.
Opponents, however, have expressed concern about the social impact on the 6,200 people who will be forced to leave their homes to make way for the plant, which is intended to start generating electricity from 2009. Others concerns involve its impact on the environment, its economic rationale and the government's management of the accrued revenue.
Most analysts, however, believe that the project will receive the green light early next year.
