A woman does weaving as livelihood in the resettlement village on Nakai Plateau in Laos. More than 6,000 people were resettled and given land and livelihood when the Nam Theun 2 dam was constructed in the area. Photo by: Meriem Gray / World Bank / CC BY-NC-ND

Three years after it started commercial operations, the Asian Development Bank sees the Nam Theun 2 hydropower project in Laos as a success.

NT2 is the largest hydropower plant ever constructed in the country and one of Southeast Asia’s first major multilaterally funded public-private partnerships, diverts water from a tributary of the Mekong River to generate up to 1,070 MW. The government believes the dam can help Laos become less dependent on foreign aid in the future, when they start to reap the profits from selling the electricity to Thailand.

However, how and where NT2 was erected sparked concerns from environmentalists and the local population affected by the environmental impact.

Over 6,000 people were resettled, but according to ADB, this was done the right way — giving them land and providing them with livelihoods. The result: Most of the displaced population has doubled their income in less than a decade. They lost their ancestral terrain, but now they hold — for the first time ever in Laos — property rights over the land they till and receive technical assistance on how to produce better yields from their crops.

We asked ADB country director Chong Chi Nai to tell us more the lessons learned about the project and how it can be a model for future programs that entail displacement and technical assistance on land use for the resettled population.

The construction of the dam displaced an estimated 6,000 local villagers apart from another 18,000 residents further downstream. How were they compensated?

[A total of] 17 villages were impacted by the impoundment of the reservoir, and approximately 6,000 people were resettled. They all received a comprehensive compensation packages that included a new plot of legally titled, cleared and leveled land, a new, well-designed house built with quality materials, electricity access and replacement agricultural land. Education, healthcare and other public services were improved and made more accessible, and these families received livelihood support in five main areas: agriculture, livestock, fisheries, forestry and other off-farm activities. They had a strong hand in choosing.

There were an additional 18,000 people living downstream who did not need to relocate, but who were indirectly impacted due a change of hydrology in the Xe Bang Fai River. People living in 92 villages immediately adjacent to the river were provided with assistance to improve their livelihoods in agriculture, fisheries, and livestock. Education and health services were also improved. People living in additional 67 villages in the hinterlands, which were less impacted, received cash compensation.

Some of the affected communities have complained the land they were given is not suited to support their livelihoods. What is ADB doing to address this concern? What type of projects is the bank supporting?

People were regularly consulted during the development of the project, and were provided with a range options for resettlement. The villages that relocated made their own choice as to the location of their new community. Most chose to stay on the Nakai Plateau, and remain close to their original village, even knowing that the replacement agricultural land provided in these areas would not be better than the land in their original villages. In order to ensure quality livelihoods, a more diverse range of livelihood opportunities in agriculture, livestock, fisheries, forestry and other off-farm activities have been made available for resettled families so they can secure a steady income.

In any massive relocation program, land allocation and ownership is a major factor. How do you normally plan for this?

Everyone involved with this project paid particular attention to land allocation and ownership during the development of the project, and later during its implementation. Numerous consultations were held with households, and at the village district, province, and central level to ensure we had a good understanding of concerns and challenges.

One of the great achievements of this project was providing resettled families with individual land titles. This was a first for Laos, and has been so successful it has set a precedent for land management, and is now being practiced in many other parts of the country. Recently community land titles were also provided in the Nakai Plateau in order to clarify the ownership of land that belongs to the communities themselves, so the communal use of this land can be secured in perpetuity by families who live there.

Three years on, what are the lessons learned from this project’s implementation?

One lesson is that quality begets quality. The project developer, NTPC — led by Electricite de France — brought world-class technical and engineering expertise to the table, and worked diligently to ensure that the project stayed on track and delivered everything that was promised. In terms of managing the complex social and environmental aspects of this type of project, NT2 has shown that hydro-power projects can be “win-win” when done right.

[The project] has also demonstrated the following:

  • Benefits of meaningfully engaging and consulting with communities, and local authorities, from the earliest stages of a project.

  • Importance of securing legal access to land and natural resources for families that need to move, through the provision of individual and community land titles. This is essential to ensuring sustainable livelihoods for these families, particularly in context where there is ever-increasing pressure on land for industrial and other development.

  • Value of thorough and realistic planning, of building a highly competent team to implement various programs and develop local administrative capacity, and of anticipating and preparing for the eventual management of programs by local authorities, to ensure upward progress continues.

  • Fact that livelihood restoration remains one of the most challenging, and most important, cornerstones of these projects. Introducing new ways of earning a good living in communities is complex, and takes extraordinarily more time than building a house or a road. It therefore requires a great deal of resources and attention.

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About the author

  • Carlos stamaria 400x400 v2

    Carlos Santamaria

    Carlos is a former associate editor for breaking news in Devex's Manila-based news team. He joined Devex after a decade working for international wire services Reuters, AP, Xinhua, EFE ,and Philippine social news network Rappler in Madrid, Beijing, Manila, New York, and Bangkok. During that time, he also covered natural disasters on the ground in Myanmar and Japan.

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