What are the International Advisory Group (IAG), the Social and Environmental Panel of Experts (POE), and the Dam Safety Review Panel? What are their roles? Who pays them?

The International Advisory Group, the Social and Environmental Panel of Experts, and the Dam Safety Review Panel are three internationally recognized and fully independent panels that have closely monitored the Project’s development to date, and will continue to scrutinize the entire development and implementation of the Project.

- The International Advisory Group (IAG) is comprised of five eminent independent persons experienced in the fields of political, institutional, economic, social and environmental aspects of major infrastructure projects from a national Government perspective. It is responsible for monitoring the World Bank’s handling of the social and environmental issues on the Project. The IAG is paid by the World Bank.

- The Social and Environmental Panel of Experts (POE) is comprised of three technical experts of international standing in all aspects of social and environmental effects of infrastructure projects. One panel member shall be an environmental generalist with expertise in environment / development trade-offs, one panel member shall have expertise in tropical forest and biodiversity conservation, utilization and management, and one panel member shall be a social scientist with expertise in resettlement and indigenous peoples in South-East Asia. The POE is provided with the role and authorities to facilitate guidance to the Parties on i) mitigation against and remedying of Project Impacts; ii) implementation of each party’s obligations under the Environmental and Social Objectives; iii) amelioration and remedying of Unanticipated Project Impacts; and iv) the appropriateness and relevance of the Environmental and Social Objectives. The POE is paid by the GOL.

- The Dam Safety Review Panel is comprised of up to three technical experts of international standing in all aspects of dam design, hydrology, and engineering geology. The Dam Safety Review Panel is provided with the role and authorities to scrutinize that NTPC comply with and implement the requirement of the World Bank’s Dam Safety Policy relating to safety issues in respect of the design, construction, commissioning and operation and maintenance of the Project and downstream areas. The Dam Safety Review Panel is paid by the GOL.

What are the reports relating to environmental and social safeguards? Who produced them? Why are all these studies and surveys necessary, and how are they to be used? What are the current ones of importance?

Preparation of Environmental and Social studies regarding the Nam Theun 2 project has been under active planning and development by the Government of the Lao PDR and the Nam Theun 2 Electric Consortium (NTEC) since 1996. World Bank guidelines have been used to prepare these studies and associated recommendations. The World Bank indicated that it would consider supporting the Project after it has received five major reports, all of which having benefited from a thorough and meaningful public consultation and participation process.

These documents includes:

1. Study of Alternatives by Lahmeyer International and Worley International
2. Economic Impact Study by Louis Berger International
3. Watershed area studies by IUCN and WCS
4. Social Development Plan (SDP), which encompasses both the Resettlement Action Plan (RAP) and the Ethnic Minorities Development Plan (EMDP), by Acres International and Norplan
5. Environment Assessment and Management Plan (EAMP) by Seatec International Ltd

These reports, when considered in unison, allow the World Bank to assess the Project against its Operational Directives. Furthermore, these studies have constituted the basis for the preparation of certain part of the Concession Agreement that has been negotiated with the Government of the Lao PDR (GOL) to define guidelines and activities to be undertaken with respect to social and environmental management.
These reports, when considered in unison, allow the World Bank to assess the Project against its Operational Directives. Furthermore, these studies have constituted the basis for the preparation of certain part of the Concession Agreement that has been negotiated with the Government of the Lao PDR (GOL) to define guidelines and activities to be undertaken with respect to social and environmental management.

Of these five studies, the first three have been prepared for the Government with the use of International Development Agency (IDA) funding. The last two reports have been funded directly by NTEC. The first two reports give the Government advice on whether NTEC’s proposals to the Government are broadly appropriate on Engineering, Environmental, Social, Macro and Micro Economic and Commercial grounds.

The third study and reports relates to recommendations to the Government by the International Union for Conservation of Nature (IUCN) and the World Conservation Society (WCS) on legal and management structures for protection of the Nakai-Nam Theun National Biodiversity Conservation Area (NBCA).

The Social Development Plan (SDP) comprises NTEC’s assessment of the appropriate Resettlement needs and its proposals to effectively manage those needs and any other human impacts of the Project. In September 1999, the Government endorsed the Resettlement Action Plan that is encompassed in the SDP.

The Environment Assessment and Management Plan (EAMP) is a report to NTEC and the Government that was prepared by Seatec International on environmental issues related to the Project.

Finally, a sixth documents was recently produced - the Social and Environmental Management Framework and Operational Plan (SEMFOP), which contains information from the preliminary biodiversity area management plan prepared by the Wildlife Conservation Society, as well as other studies which have been undertaken relating to the Nakai-Nam Theun National Biodiversity Conservation Area (NBCA). The SEMFOP is meant to provide the Government with an implementation guide for the conservation and social development activities to be undertaken by the Watershed Management and Protection Authority (WMPA).

What is the current livelihood status of the people who will be resettled? How will it change? How will the resettlers earn their living?

The population on the Nakai Plateau has traditionally depended on shifting cultivation, livestock, fishing, hunting and gathering of non-timber forest products for their livelihood. The CARE survey of 1996 found that only 119 of the 734 households surveyed produced sufficient rice for year round consumption. Agricultural production in these villages is constrained by inadequate water supply, seasonal flooding, poor soil fertility and low levels of agricultural technology. In general, these households currently live far below the national poverty line.

The estimated cultivation area on the plateau in 1996 totaled 471 ha (less than 0.10 ha per inhabitant). Cultivated rice paddy is not a large contributor to the total production. Only 4 out of 16 villages surveyed by CARE cultivated paddy on a total of only 78 ha. Average yields in the area are generally in the range of 0.8 tonne per hectare for upland and 1.5 to 2.0 tonnes per hectare for paddy rice. Although all villages attempt to grow rice, only 17% of families are able to produce sufficient rice for a full year. At least one-half of all families have a rice deficiency for more than six months of the year.

About 200 ha of land have been identified as suitable for conventional paddy rice production on the Plateau above the relocation line of 539 masl. Of this it is proposed to develop four areas as part of the resettlement program, totalling 150 ha. These sites are in close proximity to prospective villages and potential deep-water pumping sites. It should be possible with improved cultivation techniques to obtain an average yield of 3.0 t/ha to 5.0 t/ha under double cropping. Assuming a yield of 4.0 t/ha, this would give approximately 600 tonnes of rice from 150 hectares under cultivation. On average, households will be able to meet about 40% of their annual rice requirements, which is a significant improvement over their present situation. NTEC’s Theun Douane Experimental farm achieved a one-crop yield of 3.0 t/ha with its first trial of irrigated rice in the 1998/99 growing season.

A key objective in planning livelihood options for the resettlers has been to ensure that no drastic changes are made in the sources from which these people derive their incomes. They will continue to grow rice and other crops on land allocated to them. They will raise buffaloes and pigs, harvest fish from the reservoir and also derive income from forestry. Wildlife and non-timber forest products are expected to contribute much less to household income. It is anticipated that under the Social Development Plan (SDP), average annual household incomes will rise from its present level of US$ 461 to about US$ 700 in the first year of resettlement to over US$ 1,000 in year seven. Adequate safeguards have been provided to ensure that income from forestry and fisheries accrues to the affected people. In the early years of resettlement, any shortfalls in income will be provided by the Project.

Good water quality, reasonable nutrient levels, a variety of underwater habitats and a 10m rise and fall in water levels which coincides with the natural flood cycle, all suggest a productive reservoir for fishery. Water quality in the reservoir has been evaluated in great detail and is predicted to be good from the commencement of reservoir impoundment. Sustainable yields as high as 1,500 tonnes per year have been predicted; however, based on yields per ha for low productive reservoirs in Thailand and Laos a sustainable yield of about 765 tonnes per year is considered feasible (EAMP). Income projections for resettled households are even more conservatively estimated on the basis of an annual yield of 280 tonnes.

An area of 22,000 ha of forestry is potentially available to the resettlers. Detailed discussions have been initiated with government authorities at the central and provincial levels to put in place a community forest management system that would guarantee a certain level of income from this resource.

Goods currently produced or harvested on the Nakai Plateau, such as livestock, fish and non-timber forest products (NTFPs) are already sold in markets in Nakai, Lak Sao and Gnommalath. The main constraint on production for commercial purposes on the Plateau is not the lack of market opportunities, but rather the inability to get products to market. Villages are remote, access roads are poor and there is a complete lack of access to reliable and affordable transportation.

Market opportunities will improve with better road and water transport facilities provided by the Project. Currently the markets in Nakai are supplied from Thakhek. It is expected that a large proportion of those goods previously supplied from Thakhek will be substituted by those produced on the Plateau, especially vegetables, fruit, fish and meat products. Almost certainly the reservoir will quickly become a focus for transport and trade at the village level. Larger commercial trading, requiring the transportation of large loads will be catered for by the all-weather roads which are