The Asian Development Bank is again under fire over alleged safeguards violations, this time about a hydropower project in Laos that two NGOs claim will displace indigenous people, affect livelihoods and destroy the area’s immediate environment.
ADB decided last week to give the green light to a $50 million loan for the dam in Nam Ngiep River in central Laos, which is expected to support the sustainable development of hydropower resources in the landlocked country and provide a reliable and affordable access to energy sources in neighboring Thailand. This, according to a Devex early intelligence report, would provide an increase in power generation capacity in Laos and improve the power trading between Laos and Thailand, as well as improve the integrated water resource management in the river basin.
The bank’s approval for the loan was however met with strong opposition from International Rivers and Mekong Watch, two international advocacy groups that argue the dam will not bring sustainable development to the affected communities.
“Even though the project has been approved, it should be a point of concern. ADB has — in a number of instances — invested in power projects [that] are not sustainable because of the effects on people's livelihoods, their food security and the river ecosystems they depend on,” Tanya Lee, International Rivers program coordinator for Laos, told Devex. “In Laos, the lack of transparency in the way the revenue [from hydropower projects] is being distributed, means it is not possible to ensure affected people benefit directly from the revenues generated by the export of electricity.”