E385 v15 FOURTH REPORT OF THE INTERNATIONAL ADVISORY GROUP ON THE WORLD BANK'S HANDLING OF SOCIAL AND ENVIRONMENTAL ISSUES IN THE PROPOSED NAM THEUN 2 HYDROPOWER PROJECT IN LAO PDR 20 MARCH 2004 -1- TABLE OF CONTENTS Page Summary of Conclusions and Recommendations 1.0 Introduction 1 2.0 Bridging the credibility/expectations gap 6 2.1 The watershed: interim measures 6 2.2 The plateau: interim measures 11 2.3 The downstream areas: interim measures 14 3.0 Other major issues 17 3.1 The watershed 18 3.2 The plateau 20 3.3 The zone downstream of the powerhouse 22 4.0 National issues 23 Appendices 1. Working program of IAG 2. List of persons met -2- 1.0 INTRODUCTION The three current members of the World Bank's International Advisory Group (IAG) on the proposed Nam Theun 2 hydropower project in Lao PDR---Mr Dick de Zeeuw, Convenor, Mr Emil Salim and Mr David McDowell---visited Laos over the second half of February 2004. It was the first full mission since March 2001, although David McDowell had in the interim taken part in a second Logging Appraisal Mission and a preliminary assessment of the potential impacts of the project on the Xe Bang Fai river basin and its inhabitants. The program followed and a list of people met are appended. The Group was set up in 1997 to provide an independent assessment of the World Bank's handling of environmental and social issues arising out of the dam project. It reports directly to the President of the World Bank Group and has created a precedent for the creation of such independent missions which has now been followed in a number of Bank Group projects. In the course of time and with the concurrence of the World Bank and the Government of Laos (GOL), the Group's mandate widened to encompass a range of other relevant questions including for example financial, management and capacity issues. With the time for decisions on whether and how to proceed with the dam fast approaching it seems likely that the IAG's mandate will be modified to take account of the new phase now imminent. Discussions on the new role are well advanced. The current mission will probably be the last undertaken by the Group in its traditional role. Over the course of the seven years in which the IAG has been involved in the project there has been a shift in the World Bank's philosophy towards a greater emphasis on poverty alleviation. Similarly there has been a shift in the priorities of the Government of Laos toward an emphasis on growth and poverty eradication. The implications of this for the Nam Theun project are considerable. In the first years of the IAG's work there was a concentration by all parties on the two upstream zones of the areas to be affected by the dam building---the catchment zone where most of the valuable biodiversity is to be found and the plateau zone where the village resettlement program is to take place as the area is substantially inundated by the rising waters of the reservoir. The large area of plains downstream of the powerhouse and stretching down the Xe Bang Fai to the Mekong itself was comparatively -3- neglected although this is the zone where by far the greatest concentration of people affected by the project is to be found. Apart from the philosophical considerations there were rational enough arguments for this historical neglect. It was contended that the downstream people would in large part be affected only indirectly by the project---at least compared with those in the upper two zones whose daily lives would be impacted. The developers also argued that while the inter-basin transfer of waters would trouble some of those along the banks of the Nam Phit and Xe Bang Fai by destroying riverbank gardens, exacerbating flooding in the wet season and probably reducing fish catches in the short-term, the availability of additional waters would open up big opportunities for dry season irrigation---and it was up to the GOL and other development agencies to seize these opportunities. The new emphasis on poverty alleviation brought changes in attitude and approach. The Bank and the GOL commissioned new studies on the potential impacts on the resources and people of the Xe Bang Fai, the developers in turn assumed a greater measure of responsibility for compensating financially for negative impacts and the beginnings of a strategy for handling the problems and opportunities opened up by the project in the downstream areas was being worked on. Responding in part to comments from the IAG and other critics that simply throwing money at the negative impacts was an inadequate reaction to the situation, the developers became involved in investigating and planning preventive and mitigation measures and in undertakings to help define and set out the development options which might be opened up by the project in the plains area. There remains much to be settled.The developers are committed to investing further funds in compensatory and mitigation measures in the zone as provided for in the Concession Agreement but seek a cap on the total expenditure involved. They are not prepared to become involved in implementing development work as such. So it is not yet agreed, for example, who will fund the necessary studies which should precede the release of waters into the Nam Kathang and the Nam Gnom thus enabling a significant expansion of the productivity of this area through dry season rice cultivation. A new World Bank program on rural livelihood development will, it is hoped, address this opportunity, working through existing -4- programs. For its part the provincial administration has produced draft irrigation plans and up to twentysix "conceptual" schemes including six gravity-fed ones covering much of the Xe Bang Fai central and lower zones. No decisions have been taken on how any of this might be financed. It may well that both the World Bank and the Asian Development Bank will be interested---they are both already involved in small projects in the area. An overall integrated development plan for the two provinces (Khammouane and Savannakhet) will eventually be called for. In the interim the shift to an emphasis on poverty alleviation has produced some positive new thinking regarding the Xe Bang Fai basin on the part of all involved. In one sense this shift has also had implications for the other two project zones. The developers' announced intention, backed up by very specific undertakings in the draft Concession Agreement, to significantly improve the family incomes and housing of those to be resettled in the plateau zone is vindicated by the poverty alleviation policy. And even in the watershed zone, where it is clear that biodiversity conservation and protection is the primary objective, it is also clear that community livelihood development is a priority---indeed the two will have to be very closely linked if both objectives are to be achieved. You cannot have one without the other. A second development with important implications for the project was the decision last year by both the Asian Development Bank( ADB) and the Agence Francaise du Developpement( AFD) to join the World Bank in sponsoring the project. There is a risk that with two additional sponsors coming on board at this stage yet more delays will occur in final decision- making on whether to proceed. Each has its own criteria and prerequisites for taking part in such projects and each is risk-averse in its own way. Thus far the three institutions have shown a welcome disposition to work closely together to head off further delays. It is fervently to be hoped that this unanimity of purpose will be maintained. The project has been dogged by delays for too long and the level of exasperation among the people who will be affected has risen exponentially. Still looking at the broad picture, the IAG is of the view that there remains a disposition to see the project as an enclave one. Initially it was seen as such by the developers at least. It is now viewed as very much a multi-purpose and multi-sector venture. That is appropriate. Yet this largest of all Lao -5- development projects is often approached as though it were an isolated one- off exercise unrelated to the country-wide development context. So the potential for it to drag other ventures along in its wake---to provide leverage to move things along in other sectors and to become a vehicle for wider reform---and to benefit in turn from capabilities being fostered elsewhere in the national system is not being realized. One example of the latter is in the key sectors of capacity building and service delivery. The United Nations Development Program (UNDP) and the United Nations Capital Development Fund (UNCDF) have taken a welcome and overdue initiative in providing support to the GOL to develop and implement national policy for public administration reform, local governance and decentralized service delivery for poverty reduction in selected provinces. These are prime areas for early action in relation to NT2 but Khammouane Province was not in the initial list to benefit from the initiative.(This may now change). There are other examples where funds are being invested to train Lao nationals to undertake tasks in the NNT NBCA but the opportunity is not being taken at the same time to provide the opportunity for other NBCAs to benefit. We would wish to see a more coordinated approach across the board and a broader vision from all concerned. If these are not forthcoming in the implementation phase a "deux vitesses" or even a "trois vitesses" situation could arise where one or another implementing agency gets out of kilter with the others in aspects of the project program and starts holding the whole process up. We see no evidence of a lack of political will on the part of the Government side in approaching its responsibilities and no disposition to play the "no capacity" card. Nor have we found a lack of commitment on the part of either the sponsors or the developers. But the risk of one agency going slower than the others will grow once financial closure occurs and needs to be headed off. Some of the new initiatives cited below will help reduce the risk. Finally, we would note that the planning phase of this highly promising project is drawing to a close. This phase has been long drawn out and exhaustive. It has produced plans which are comparable with the best anywhere in the world. We feel strongly that attention must now switch to the decision-making and (hopefully) implementation phases with further studies being undertaken at this particular time only where they are an absolute prerequisite of the sponsor agencies for decision-making. There remain uncertainties. That is always so in the complex field of development and conservation---in any country, developed or otherwise. There is a vast -6- amount of sound information available now. There is time to pursue further studies in the period before construction and inundation occurs. What is needed now is a total concentration on decision-making so that the credibility gap---or is it rather an expectations gap---may be bridged before it widens further. World Bank people concur: they now distinguish between what is desirable and what is required. The first section of this report is accordingly devoted to actions which should in our view be undertaken as a matter of urgency to bridge the gaps. Subsequent sections will address other major issues at the project and national levels. -7- 2.0 BRIDGING THE CREDIBILITY/EXPECTATIONS GAP Because there have been so many delays and because the planning and indeed the consultations have been so drawn out a gap has emerged which is both one of credibility and one of as yet unmet expectations. This affects the villagers' view of the sponsors, the developers and the GOL bureaucracy. We suspect that all are seen as dragging their feet in one way or another. From the villagers' viewpoint the period of waiting has often involved sacrifices such as reducing their consumption of forest and wildlife products without compensatory measures being taken. Living standards have suffered as a result. An understandable tone of disillusionment is occasionally discernible in their comments. The schedule shows that there will be no immediate relief for many. On present planning the sponsors will decide to proceed or not in the first two months of 2005. This will inject much more certainty into the process but an equally important milestone is 8 May 2005 when financial closure is to be achieved---or penalties will start to accrue under the Power Purchase Agreement. From closure time the initiation of many project activities will begin---but processes such as resettlement will not be completed for several years afterward and delicate work such as fostering new livelihoods will take many years to come to fruition. Amelioration and preparatory measures must begin in the interim. What are these measures? 2.1 The watershed: interim measures The primary responsibility for handling the sensitive task of fostering biodiversity conservation in parallel with and linked to livelihood development among the watershed peoples lies quite rightly with the Lao side. The Watershed Management and Protection Authority(WMPA) is taking on this job. It will largely be funded for most of the life of the project by an annual grant of US$1 million from the developers. -8- In the period before financial closure the Lao system has many tasks requiring completion: · Clarification is needed in the social and environment management and operational plan (the SEMFOP) on how the corridor areas of the NBCA are to be managed for wildlife and protected from human exploitation. There is very little specific mention of the corridors in the SEMFOP yet an understanding of their ecology and how they may be managed to facilitate the migrations from habitat to habitat of mega fauna like elephants is important. The likelihood of human/elephant conflict once the reservoir has invaded much of their former foraging areas and salt licks remains high and certain to be difficult to handle. It is good that a study of the elephant population and its habits is already underway by the Wildlife Conservation Society. We trust that the WMPA will give early consideration to the actions recommended following the study and implement them as a matter of some moment. · Similarly, there is an urgent requirement for clarification of what constitutes, who manages and what interventions are planned in the buffer zones---or, as the SEMFOP calls them, the Peripheral Impact Zones(PIZ). It is a global orthodoxy that islands of high biodiversity value cannot survive in a sea of deprivation and poverty. The IAG went into a number of PIZ villages and found in general a high level of poverty and high expectations of the NT2 spin-offs for them. But population pressure, particularly along the northwestern boundary close to where 70,000 people live, and disastrous floods in 1996 and 2002 which destroyed irrigation systems, have resulted in some villages in a reversion to old and tried methods of food production. Shifting cultivation clearings edging up to and over the boundary of the NBCA were seen in Ban Na Meung, for example. Nevertheless we observed little of such new clearing and considerable areas were regenerating, which is reassuring. · The WMPA is to undertake conservation-and-development interventions in the buffer zones (PIZ). If District Administrations cannot do this---they have the formal responsibility---then the WMPA may find that the fastest way to make an initial impact is to help repair the existing irrigation systems. There is a cap on buffer zone expenditure over the first five years of the WMPA budget of $258,500. -9- That will not go far given the probable extent of the zone and the manifest needs. The IAG recommends that one or both of the development banks involved---or the AFD---set up as a matter of urgency a sustainable rural livelihoods fund for the PIZ along the lines of that being contemplated for the Xe Bang Fai. It is convinced that this will be as timely an investment as the money spent on villages inside the watershed. · The IAG also supports the POE recommendation that mining in any form be prohibited quickly in the NBCA. It is greatly encouraged by the decisive and effective way in which the GOL moved by decree to stop logging in the area three years ago and supports similar decisive action in regard to mining. The potential for mining inside the catchment to produce erosion and sedimentation is too high to risk, to say nothing of the impacts of accompanying infrastructure like roads. A system to monitor effectively both logging and mining bans and public reporting thereon will be called for in the interests of credibility. Modern technology using periodic satellite surveillance is relatively low-cost and it works. · Finally, an early move to step up the intensity and unpredictability of patrolling both within the catchment and in the buffer zones is vital. First moves have been undertaken: we looked through an Army patrol camp near the dividing hills area in the southeast of the NBCA and a joint inspection post north of Laksao, set up to check vehicles going up and down this road to and from the international border. Our judgment was that the element of unpredictability was missing. The poachers are well organized and learn quickly of the sites of patrol stations and how and when they operate. It was no surprise to find that the Army patrol had made no arrests of poachers though they were enthusiastic and made regular visits to likely incursion points. Interestingly, the patrolling undertaken by the village militia in the northwest region appeared to be more effective, with many local poachers being fined--- though merely escorting transgressors from Vietnam they intercepted back to the border provides little incentive for ceasing incursion. -10- · Bilateral agreements and understandings between the two neighbouring and friendly countries on how to curb the incursions would be a most worthwhile development. There is a precedent for a bilateral agreement on biodiversity issues between Vietnam and Cambodia. Already the border provinces of Ha Tinh and Boulikhamxay hold regular meetings on a range of issues of mutual interest. As a result of a visit to Vietnam by top officials of the WMPA---which IAG and POE members were privileged to accompany---there are now informal understandings between the two sides on the desirability of closer ties and cooperation. The IAG welcomes this and would strongly support moves towards such constructive activities as information exchange and joint patrolling. · We found striking evidence that fairly large-scale taking of wildlife is still going on inside Laos by Lao people when casually checking a local market on the main road from Thakkek to Vientiane. Eight mammalian species were freely on sale---two specimens being alive--- and three live bird species. The remains of nine large deer of three species were on display. Of course it was not clear that these had come from the NNT NBCA---or any other NBCA---but it seemed likely that some of the less common species had their origins in protected areas. By contrast, the formerly active livestock sellers in Laksao were nowhere in sight---decisive action by the Boulikhamxay authorities having halted the trade or perhaps driven the sellers and their suppliers underground. If the remaining faunal biodiversity of Laos is to be preserved a total and truly effective ban on poaching is going to be required eventually. In the interim greatly expanded and less predictable patrolling is called for. The figure of 350 patrollers in the NNT NBCA cited by the World Bank does not seem excessive by global standards. · A species meriting stepped up and special protection is the saola. A very recent workshop in Vietnam on this magnificent animal--- classified by taxonomists only a decade or so ago---concluded that the prospects for this highly endangered species surviving for another twenty years in the wild were not good, though the NNT NBCA is one of two areas it is found in any numbers. The IAG recommends that the existing, but not yet translated into Lao, Saola Plan be updated, -11- translated and put into effect as a matter of urgency. There is a credibility issue here for the Lao side. The developers also have responsibilities for interim action in the watershed. While they have been generous and imaginative in setting up at considerable cost a pilot resettlement village on the plateau well before financial closure, they do not seem to have been equally responsive in providing the agreed funds for operations in the watershed. So money has been flowing in dribs and drabs only. The result is that while the GOL has acted quickly by appointing an Acting Director and three Deputy Directors for the all-important Watershed Management and Planning Authority the resources to make them fully operational and to get underway the vital patrolling and livelihood development activities---and to bring in the international technical advisers---are not yet to hand. The CA makes clear that the first tranche of the developers' contribution ($1 m.) is to be made available once the Project Commencement date is past. That moment has passed. Now a new element has surfaced: the WMPA people are to produce a complete and itemized budget before the bulk of the funds will be forthcoming. Furthermore, the CA now sets out what are in effect five-year expenditure caps on individual sectors of the WMPA budget. This imposes a quite inappropriate and unrealistic element of inflexibility on the budget. The IAG understands that the developers are responsible to their funders for ensuring that grants like the ones to the WMPA are spent to meet the agreed objectives. But the developers are represented on the WMPA Board, the Board's Program and Estimates will be public documents and there is agreement that there will be independent monitoring and auditing of expenditure. To set sectoral expenditure caps at this point and to require detailed itemized budgets before payments is to risk raising questions about who is supervising the WMPA, the Board or the developers. We recommend that a less intrusive and more timely method of advancing the agreed funds be worked out and that it be made clear that the sectoral caps are indicative figures only and that the Board has the right to move resources from one sector to another (beyond the 15% limit presently cited) within the overall allocation. In the interest of even-handedness we have to observe that there are occasionally signs of the World Bank also attempting to exercise undue influence on how the WMPA Board and the Executive Secretariat are to -12- manage the watershed. It has, for example, multiple requirements of the authors of the SEMFOP documents before a final draft appears. Our general point is that the only way that the WMPA Board and the Secretariat managers are going to learn to manage the watershed is for them to do so. The time is coming when others must step back. Mistakes will be made, but that is inevitable---it is part of the learning process. In the interests of retaining flexibility and having sufficient funds to cover operational costs, we suggest that in the initial years the WMPA people not over-commit the budget in meeting recurrent costs. We are assuming that unspent balances may be carried over from one year to the next. For the record, the IAG has made further detailed comments on the proposals for the WMPA Board and its relationship with the Secretariat--- the Director should be allowed to manage the day-to-day running of the operation without interference from the Board, for example---and has passed these separately to the various parties involved for consideration. We are concerned that the Board has no direct representation of catchment villagers, That is to us a significant deficiency. If it cannot be remedied at this point then some other method should be devised to ensure a direct input into the Board's discussions and decisions by the people most affected by them--- perhaps an advisory group of village headmen and LWU women, for example. The value of local knowledge and wisdom should be acknowledged and drawn upon in this way. 2.2 Interim measures: the plateau The exercising by the developers of their option under the Concession Agreement to move on resettlement before they are required to do so has already been applauded. We trust they will not now rest on their laurels. Urgent works needed are: · To undertake as a matter of high priority the soil and associated topographical and hydrological surveys needed in order to finalize resettlement sites and budget estimates and enable preparatory work to begin on agricultural livelihood development. We are concerned because the prospect is that, as already discovered at the Theun Duane -13- Demonstration Farm, the soils of the plateau will not prove fertile enough---and are too acidic and porous---to produce padi rice economically as desired by the resettlers. If the soil surveys confirm this supposition then some revision of agricultural livelihood plans will be necessary, overall agricultural strategies will have to be revised and villagers' expectations of growing their own staple dampened down. The IAG recommends that soil and associated topographical and hydrological surveys for the first ten resettlement sites be completed in the next six months ie. by August 2004. The implications should then be thought through in time for the appraisal phase. · A second priority is that the nursery work be extended, in particular by diversifying the range of vegetables, crops and fruit trees being tried and propagated. We were disappointed to discover that there is a concentration on three or four tree crops only. A redirection and expansion of the nursery is called for. · What the documents and reports we have seen on the plateau livelihood options---whether agricultural, forestry, fisheries or others-- -reveal is that there remains work to be done in firming up the plans and estimates for each sector. Finalizing these elements of the planning in a form credible enough to go to the appraisers later this year calls for some fast work by those involved. They need little encouragement from us. Clarification is also needed from the GOL on who will have the authority and mandate for reservoir management: · As the SEMFOP says, the reservoir will be "...of crucial interest and concern to a range of stakeholders". Three different agencies seem to share management roles---the District Administration, a Reservoir Management Division in the WMPA and a new but largely undefined institution called the Reservoir Management Authority (RMA). This is a recipe for confusion. We recommend that the overall authority lie clearly with the RMA. The latter will have to work closely with the provinces and districts, the WMPA and, very importantly, with the -14- representatives of the resettlers. The latter should be directly represented on the management body of the RMA. · Funding for the reservoir work is provided for in the CA but it may be that a different model---a State Owned Enterprise, largely autonomous and raising its own revenue---is worth consideration. At present the earnings from clearing the future inundation area simply go into the general GOL coffers. With the resettlers showing interest in cutting timber themselves for their housing there would be logic in this timber coming from the reservoir area and in the RMA being given authority to oversee this and other aspects of the clearing operation--- and deriving revenue from any commercial contracts signed. Beyond the clearing phase and once the reservoir fishery has built up the RMA could also derive funding from overseeing the commercial aspects of the fishery. This would relieve the budgetary pressure on the annual subvention from the developers and enable it to go further. In any event the RMA will need to work on a daily basis with the Village Forestry and Fishery Associations. · Reference has been made above to the idea of the RMA taking on responsibility for overseeing clearance of the inundation area and providing the opportunity for resettlers to cut their own timber for houses from there and thus acquiring timber processing skills. The early provision by the developers of mobile saw mills would be a useful start for the Village Forestry Associations in learning how to manage and process their own production forests. We so recommend. In summary, the success of the pilot village venture in enabling lessons to be learned early on about likely problems on the resettlement front and the commitment of developers and resettlers alike augur well for the future of the plateau people---but as detailed above there remain difficult tasks to accomplish in the interim period before financial closure. 2.3 The downstream areas: interim measures -15- The zone in which the costs most heavily outweigh the benefits is the Nam Theun and its tributaries below the dam itself. The complete picture is not yet clear since a riparian release study commissioned some time ago is not yet (through unfortunate circumstances) available. But we nevertheless find it surprising that at this stage of the exercise there is still no reliable data to hand on the totality of the impacts below the dam and the precise numbers of people to be affected. This work should be undertaken as a matter of urgency by the developers. As for the area below the powerhouse, there is a requirement for early action by all parties: · The GOL, for example, has a clear responsibility for coordinating the various Government agencies which should be being brought into the task of using the turbined waters to be released. We found that a senior official in the Irrigation Division of the Ministry of Agriculture had not yet been informed of the likely volumes of water to be released once the dam is built and did not know that the developer had offered to mitigate the effects of water release at flood time by shutting down the turbines. Such information is vital to planning and should be freely shared among Ministries. Apparently there is an existing Water Resources Committee which has coordination functions at the centre but no teeth. There appears to be a need here for strengthening the system. · There is a requirement also to develop the existing conceptual irrigation plans for the Xe Bang Fai basin and update them. As noted in the introduction, at the provincial level in Khammouane there are twentysix schemes including six gravity-fed ones at the developmental stage. These require further fleshing out for presentation to potential donors, of which there are several. Action at the provincial level is called for. · Visits to two villages on the Nam Gnom illustrated to us the variation in levels of poverty among villages and within villages---and in their -16- capacity to exploit an opportunity like the turbinated flow in the dry season. In one the headman quickly calculated what would be needed to lift the village's existing electric pumping capacity so as to use his entire 200 ha. in the dry season---and proposed too to extend the total acreage in padi by a sixth or so. His calculation was that he could more than double rice output---and he was prepared to consider diversification away from rice though alternatives were often more labour intensive. The second much poorer village thought only of a dry season rice crop as the product of an expanded flow in the Nam Gnom- --and experience elsewhere shows that a second rice crop will not of itself lift villages above the poverty line. Our conclusion was that a village by village approach was going to be appropriate---and that many were going to have to be weaned gradually away from a total concentration on rice production, especially when soil conditions and land suitability do not favour it, and encouraged to diversify into more high value crops. · Which brings in the development institutions, inter-governmental and NGO. The Nam Kathang plain could largely be irrigated by gravity-fed systems, while the Gnommalat plain below it may more often require electrical pumps. Both areas need to be soil surveyed and environmentally and socially assessed. They appear to offer a relatively straightforward opportunity for the proposed new Rural Livelihood Program of the World Bank to make an early impact. We commend the suggestion to the Bank. As a scoping mission has said, any such interventions---which would be more than irrigation schemes as such--- would be able to work with and through existing programs in the basin financed by IDA and other donors, including one trusts the new sponsors, the ADB and the AFD. · We share the view of the scoping mission that the desirable medium term goal is to work towards a XBF basin-wide multi-sector approach, consistent with protection of the watershed and truly sustainable use of the natural resources within the basin. · The priority for the developers on the other hand is to firm up quickly the assessments of impacts in the zone and their cost in order that the debate over what is compensation and mitigation and what is -17- development may be resolved. This is outstanding business which has the potential to derail the process over the next year. The IAG has some sympathy with the developers' view, strongly held and advanced, that they did not get involved in the project to foster multi-sector development in the XBF. That said, it is often difficult to distinguish between the two roles. A renewed negotiation is needed imminently, perhaps with a third party involved to help resolve the conflict. · In one sector in particular (fisheries) there is a fairly large gap between what the World Bank's adviser estimates will be the cost of mitigation and compensation for the initial impacts of the swollen and disturbed XBF flows on fish habitats and populations and the developers' estimates. The latter wish to cap the total potentially payable. In this dispute the IAG's consistent view has been, and remains, that the developers have for long heavily under-estimated the level of fishery impacts on the XBF. The developers have not got a strong case in this instance and should abandon the attempt to cap costs before there is a consensus on the magnitude of the impacts. In summary, the belated endeavours to make up for lost time in recognizing and addressing the downstream impacts and opportunities of the project in the XBF basin are starting to bear fruit. All parties are encouraged both to keep up the momentum now achieved and to resolve quickly the conflicts remaining. -18- 3.0 OTHER MAJOR ISSUES We comment below on major project issues not covered in the interim measures section above. Several of these matters have been commented on in earlier IAG reports. This text should be read in conjunction with them. It will already be apparent that the IAG remains firmly in favour of the NT2 project proceeding to appraisal and implementation. We have been further confirmed in this judgment by what we have seen and heard in the course of our recent visit. That made clear, we have a number of thoughts and concerns which should be recorded. First, there is a number of uncertainties in terms of impacts which will affect both the environmental and social outcomes of the exercise and the economics. A consolidated list of impacts is to be produced shortly by the AFD. This will be valuable. An updated overall economic analysis is also being worked on, one input being a comprehensive cost/benefit analysis which was introduced in a draft form in Vientiane while we were there. Setting on one side the philosophical issue of whether operations like this one lend themselves to an accounting approach---involving as this does an attempt at evaluating in monetary terms a society's dependence on a natural ecosystem like the NNT catchment--- we have several serious questions about the methodology being employed in this instance. We have suggested, for example, that the value of the range of natural services performed by an intact NNT watershed be added to the equation( sponge, filter, erosion and flood mitigator, partial climate stabilizer etc.), that the importance of cultural services (indigenous knowledge) be taken into account and that the potential benefits of the use of the turbinated waters to be available in the XBF basin be updated and the results included. The preliminary conclusions are encouraging with the global benefits likely to be in the order of $50 to $80 million at present value. The local benefits (beyond revenue flows, which are substantial) are likely to be of a smaller order of magnitude but still significant even when offset against costs. We are of the view that the local benefit column in the analysis is consistently under-estimated---which may be prudent at this stage of the analysis. A more authoritative paper is expected by the end of March. -19- A zone by zone comment on other major issues follows. 3.1 The watershed This remains in our collective view the most problematical area in terms of meeting the project objectives. Its magnificent flora remains substantially intact beyond the inhabited river valleys. There is little evidence of logging since 2000 bar what has been called a couple of unhappy events, identified by the GOL side. A further logging appraisal is due and should be carried out during the next dry season, with or without international participation. The faunal outlook is less positive. As noted already, poaching---by locals and others---still goes on and the watershed's icon species, the saola, is under threat of extinction. We underline our recommendation above that the existing (but not yet translated into Lao) Saola Plan be updated, translated and put into effect as matter of urgency. Beyond that it is gratifying that the SEMFOP ranks conservation of biodiversity as the primary objective. But the WMPA has a big job on its hands in achieving this and the linked objectives. Some of the(partial) answers are: · continuing to restrict access to the watershed to tracks which will take two-wheel tractors and their trailers and motor cycles but not four wheel drive vehicles---and orienting the track system down towards Nakai rather than north or between the river valleys. That probably means tracks less than two metres in width. Such tracks will in any event be easier to construct and maintain in the often steep topography of the watershed. We would recall also the recommendation in our original report that the use of shallow draft jet boats with triple aluminium skins---rugged, able to operate in a few inches of water and negotiate many rapids and simpler to maintain than conventional outboards---be investigated for post-inundation reservoir and river navigation and transport. -20- · trying to relieve external pressures by helping lift living standards in the PIZ (see above). · expanding the size and capacity of the patrolling system and endeavouring to enhance its unpredictability and level of motivation(see above). · addressing land tenure and resource use rights questions which inhibit non-destructive production, and building on earlier work by IUCN in particular in developing alternative livelihood patterns which are acceptable to the watershed dwellers. · addressing population pressures through improved maternal and child health programs, educational work on family planning and birth spacing---and not discouraging voluntary outward migration from the watershed. Experience elsewhere in South East Asia and beyond suggests that the above actions will not be sufficient in themselves to halt the taking of wildlife and scarce NTFPs in the NBCA. The new leadership in the WMPA is going to have to come up with some imaginative new approaches to the problem in order to modify the cultural practices of generations of watershed dwellers. This will in the end be the major challenge facing them---and will be the measure by which the success or otherwise of their work will be judged by the international community. There are several new approaches proposed in the SEMFOP for handling the situation facing the WMPA. It is hard to oppose such concepts as adaptive management and ICAD(Integrated Conservation and Development) and FLUPAM(Forest and Land Use Planning and Management) and we wish the WMPA well in endeavouring to adapt these frameworks to the NNT watershed. But in the end it will be the quality and drive and creativity and leadership of the people recruited to put these systems into effect which will count most, not the suitability of the systems. We lay stress on the -21- recruitment, training and motivating of staff---and village leaders and innovators---as important objectives in the months ahead. 3.2 The plateau Resettlement exercises have historically been the Achilles' heel of large dam projects. Such projects have tended to be designed by hydropower engineers, who have seen them purely as electricity producing ventures rather than multi-purpose and multi-sector development exercises. The IAG's view is that on present indications the NT2 resettlement may well prove to be one of the most successful aspects of the project. That is a brave forecast at this point but it reflects a confidence in the will and ability of all concerned to make the operation work. As important it reflects a belief in the determination of the villagers themselves to end up better resourced, better housed and better off all round. The positive response by the GOL and the developers to the recommendation in our second report that a pilot resettlement village be set up to test the resettlement plan's assumptions and the feasibility of achieving its ambitious objectives has resulted in the moving of twentynine families thus far. They have chosen a site within their spirit boundaries on the edge of the high water mark of the reservoir. They decided to retain their traditional structures by remaining in their five clan groupings of old and rejected suggestions that individual family dwellings be sited on family garden plots- --they wanted a consolidated village. That is what they now have. Families interviewed were happy with the house designs, citing the quality of the building, the electrical connection, water on site and the proximity to their gardens as key advances. In three houses the families had decided to use the room designated as a kitchen as an extra bedroom, building on themselves a more classic village kitchen from timber brought from their old houses. The developers might research whether this indicates a design inadequacy---the traditional design is more open and this facilitates a free flow of air and the removal of smoke---or is merely an adaptation of old ways to the new circumstances. -22- Building houses is simple compared with helping ensure that the villagers are enabled to enhance and sustain livelihoods which will lift them above the poverty line. A start has been made. The resettlers have been assigned land for each family, water from a specially constructed dam flows into garden water tanks, a fertilizer plant burns and decomposes rice husks to enrich the soil and a range of fruit and vegetables is planted and growing well. As noted already, the soils are low in pH and lime brought in from near Mahaxay is applied as well as organic fertilizers like manure. Growing rice here is hard work and not very productive so in time the villagers may have to be convinced---may decide themselves---that raising funds through other means and buying their rice makes more sense. Some have already come to that conclusion. It is encouraging that several families are already selling surplus produce in Nakai. But we would suggest that the lessons from elsewhere for agricultural ventures in soils such as those on the plateau appear likely to be are that they will only be fully productive with continuous inputs. In short, sustainable agriculture in these conditions is only feasible with fertility management and thoroughly researched and tested cropping systems. We reiterate that early action by the developers on soil surveys is crucial. The two other resource use livelihood options for the resettlers---forestry and fisheries---are still in need of firming up to a degree. The forest resources available are not as extensive as first thought but will apparently still bring in a monthly contribution to family incomes once the Village Forestry Associations get into gear. (See the recommendation above about the provision of mobile sawmills.) The reservoir fishery may initially expand (global experience is that reservoir fish biomass increases immediately after flooding due to release of nutrients from inundated land and vegetation) but may then decline for several years. But there is confidence that it will recover as swiftly as others like the Ngam Ngum have done and will become highly productive. Recommendations emanating from the forthcoming reservoir biomass report and from a technical paper on the creation of artificial reefs of large stones on the reservoir bed will need to be assessed and acted upon relatively promptly, though the inundation is not of course imminent. Care will have to be taken that exotic fish species are not released into the reservoir. We saw several fish ponds down the Gnom valley stocked -23- with exotics and heard one rumour that there were even specimens of the highly predatory Nile perch to be found in such ponds. Given that the introduced Nile perch wiped out 300 native species of fish in Lake Victoria it would be prudent to investigate this rumour. It will be important to ensure that the resettlers obtain the maximum benefit from the catching and sales of the reservoir stocks. We support the position of the POE that reservoir fishing be restricted to the resettlers by decree and that an open marketing system be established so that there is no marketing monopoly set up. The resettlers' rights to process the fish should also be protected. 3.3 The zone downstream of the powerhouse (XBF) The major issues have been covered in the introduction and the interim measures section. We would only add that the Provincial and District Administrations in this zone have more preparatory work to undertake than elsewhere because the beginning of the work was so long delayed. If there is to be a basin-wide approach to development as we advocate then two Provinces will be involved---Khammouane and Savannakhet. That will be a challenge in the decentralized system in Laos but it makes good sense. The concentration of attention thus far has been on the XBF immediately below the powerhouse. There are impacts to be expected further down the river as well. A hydrology study now underway will identify heightened flooding risks down to the Mekong and the impacts on agriculture in the area. Since this will have implications for compensation and mitigation plans and for development the outcome is awaited with interest. Presumably the CA may need to be revised as a result. A cumulative impact assessment underway will look inter alia at the project's impact on the Mekong itself. This will be much less than the serious effects already manifest of big dams built further upriver but it is appropriate that all such impacts on a regional resource like the Mekong be measured and the lessons learned. 4.0 NATIONAL ISSUES -24- The two big project issues of national import are closely linked. They are capacity building and---given the imminence of decision-time--- implementation. It is difficult to get a secure handle on either or to be completely sure that they are being addressed by any party in a coherent way. Seven years on we have not seen the comprehensive capacity-building plan for the project sought in our first report. And it is not reassuring to observe that existing capacity is not being fully utilized: in our third report we commented that the restructuring and downsizing of GOL agencies with responsibilities in the conservation and environment protection areas was most untimely. We were therefore disconcerted to learn that this year's budgetary provision for a key agency like STEA has fallen to a derisory level. Further staff losses seem inevitable if the funds are not supplemented. The GOL has an emerging credibility problem here. We enjoin them to address it. It cannot be said that there is any longer a lack of initiatives aimed at the capacity gap. As noted above, UNDP is now taking on with some vigour the sensitive job of working with the GOL on such essentially capacity building tasks as public service reform and delivery, people's participation and fostering the rule of law and sound financial management. We were so impressed that we argued (we think successfully) for the next provincial pilot project to be in Khammouane, the main project province. And the World Bank is also focussing on what is now called capacity enhancement, Laos having been selected as a pilot country for drawing up a strategy on capacity priorities. The emphasis is on mainstreaming capacity enhancement in Government and in the Bank's country program and on working with partner institutions. The needs of the NT2 project are not being ignored: it is acknowledged that an extensive capacity building program will be needed in such areas as management of private infrastructure, mobilization and management of revenues, communications with local and international stakeholders and dealing with safeguards relating to natural resources. At the grassroots level there are substantial training requirements. With up to 350 or more patrolling people the demands for trainers will be large and ongoing in the WMPA. In what may be its most lasting contribution the -25- World Bank's LIL project initiated low level training courses for village nurses and more detailed training for village school teachers. We gather that these are being continued through funds from Japanese Government sources. Some useful precedents are being set. The WMPA Secretariat will doubtless bring the various initiatives together. We are encouraged by all the activity and the resources going into the endeavour but would be the more enthused were we certain that the GOL itself is buying fully into the process. Ministers we talked to assured us that for their part they needed no nudging to take capacity building seriously--- and they saw the potential benefit nationally of a cadre of experienced people coming out of the project as the years go by. Which leads on to the linked question of implementation. The prospect seems to be that the project will go ahead more or less as now planned. That is good but sobering news. An implementation plan is under preparation and will be available in May. We will comment further when we have seen the plan but would simply stress at this point the necessity for the implementation program to be transparent, for respective roles to be clearly spelled out, for supervision arrangements to be detailed, for monitoring and evaluation systems to be incorporated and for all aspects, not least expenditure, to be verifiable. The possibility of a deux vitesses or even a trois vitesses implementation phase emerging is real enough and must be precluded to the extent feasible. A fundamentally important part of this will be the building of confidence that the revenues from the project will indeed be devoted to the poverty reduction and environmental and conservation programs set out in the National Growth and Poverty Eradication Strategy. This is sensitive ground. The sovereignty of Laos must be respected. As one senior Lao put it: "We are small, poor, landlocked---everything... But we are still a sovereign country." The fact that the sponsors' funds come from public sources has similarly to be recognized. Negotiations are underway both to strengthen Lao financial management systems and to set up specific NT2 revenue management arrangements. While there was initially some resistance to the concept Lao Ministers appear to be moving towards accepting that a high level of transparency including designated programs and accounts, internal and external audits and bottom-up accountability mechanisms will be -26- expected. The adoption by all parties involved of the "publish what funds are received" principle would be a helpful step towards greater transparency. Further talks will take place in March 2004. The IAG reiterates the importance of an agreed resolution of this issue and understands the sensitivities on both sides. We spelled out in the Introduction our conviction that the project must not be viewed as an enclave exercise but as a multi-sector and multi-purpose venture. We would also argue that there remains a need to further indigenize the project---to engender a greater sense of ownership of the project in its many aspects among the people and institutions of Laos. This is not a World Bank/ADB/AFD project which happens to be based in Laos. It is a Lao project---the nation's largest---in which the international institutions have an important but not over-riding role. We would contend that there should not only be a more integrated endeavour to use the momentum and leverage of the project to drag other ventures along in its wake and achieve wider reform but to induce greater buy-in on the Lao side. It is not for us to suggest how this may be achieved but we would be reassured were it clearer how the project fits into such wider Lao contexts as the National Poverty Eradication and Macro Economic Stabilization Strategies, private sector development plans, the Growth Triangle Plan (Laos, Vietnam, Cambodia) and even the much wider Mekong-Gangga Basin concept. One relatively simple method of speeding this process up may be to translate a greater proportion of the project documents into the Lao language and thus make them more accessible to a wider Lao audience. Our point is that a more conscious effort is called for to maximize the benefits of the project for the Lao people. We commend the point to the GOL leadership. We have some observations about the way the process of decentralization has evolved in Laos and the possible implications for the project. Experience elsewhere (including in the World Bank?) suggests that decentralization requires a degree of recentralization. This is a paradox. But a loss of national or organisational coherence sometimes demands that the centre reassert some of its authority through monitoring and other mechanisms. We have no basis for supposing that this is required in Laos. It is of interest, however, that one seasoned observer reported that there was a degree of what he called resource capture by the provinces with central Ministries often cash-strapped when there were cash surpluses in the provinces. That may be no bad thing -27- when the project is going to have to rely on the provinces to implement many aspects of its plans although as we have pointed out there may be serious repercussions for central Ministries. We merely note the matter here and support the view that there is a good case for the relevant provinces to "sign off" on some aspects of the implementation plans and agreements since they are to be so heavily involved. Finally, while the IAG still feels that there is a case for an eventual trans- boundary World Heritage site incorporating the NNT NBCA of Laos and the Vu Quang National Park of Vietnam it does not regard seeking such status as a high priority at this time. The World Heritage Bureau requires that an effective management system be in place before World Heritage status is sought. This is several years down the track in the case of both NNT NBCA and Vu Quang. ----------------------------------------- SUMMARY OF CONCLUSIONS AND RECOMMENDATIONS The IAG remains firmly in favour of the NT2 project proceeding to appraisal and implementation. We have been confirmed in this judgment by what we have seen and heard in the course of our visit to Laos in the latter part of February and early March 2004. That made clear, we have a number of thoughts and concerns about aspects of the project. These are summarized below. The addition of the Asian Development Bank and the Agence Francaise du Developpement to the sponsors' group is very welcome. But it is fervently to be hoped that the present unanimity of purpose of the expanded group will be maintained. The project has been dogged by delays. The level of exasperation among the people who will be affected has risen exponentially as a result. A credibility/expectations gap has opened up. BRIDGING THE CREDIBILITY/EXPECTATIONS GAP The watershed: interim measures -28- As a matter of urgency the GOL needs to: · clarify in the SEMFOP how the corridor areas of the NBCA are to be managed for wildlife and protected from human exploitation · give early consideration to the actions to be recommended in the WCS elephant study and implement them as a matter of some moment · clarify what constitute, who manages and what interventions are planned---and by whom---in the Peripheral Impact Zones · invite one or both of the World Bank and the ADB---or the AFD---to set up a sustainable rural livelihoods fund for the PIZ along the lines of the Xe Bang Fai one · decree a ban on mining in the NBCA and set up a system to monitor both the logging and mining bans incorporating satellite surveillance technology · through the WMPA management step up the frequency and unpredictability of patrolling within the watershed and the PIZ -29- · follow up on existing provincial-level cooperation and newly created cooperation at the protected areas level between Laos and its northern neighbour in the interests inter alia of reducing the cross-border wildlife trade and poaching. As a matter of urgency the developers (NTCP) need to: · work out and put into effect a less intrusive and more timely method of advancing the agreed annual subvention for the WMPA · make clear that the budget's sectoral expenditure caps are indicative figures only and that the WMPA Board has the right to move resources from one sector to another (beyond the 15% presently cited) within the overall allocation. For its part, the World Bank also needs to pull back and stop trying to exercise undue influence on how the WMPA manages the watershed through, for example, setting multiple requirements of the SEMFOP drafters. The only way the WMPA Board and the Secretariat will learn to manage the watershed is for them to be allowed to do so. In the initial years it is suggested that the WMPA people retain operational flexibility by not over-committing the budget to meeting recurrent costs. Within the WMPA structure the Director should be left to run the day-to-day affairs of the operation without interference from the Board. The IAG is concerned that the people most directly affected- --the villagers---have no direct representation on the Board and suggests that if this cannot be remedied at this point then some other device be worked out (an advisory body?) to ensure that their voices may be heard. The plateau: interim measures As a matter of urgency the developers need to: · undertake the soil and associated topographical and hydrological surveys required to finalize resettlement sites and plan agricultural livelihood work beyond the pilot village. The IAG recommends that the surveys for the next ten resettlement sites be completed by August 2004. -30- · redirect and extend the nursery work, in particular by diversifying the range of vegetables, crops and trees being tried and propagated. · provide mobile sawmills for the Village Forestry Associations so that they may process reservoir trees for their own houses and acquire the skills to manage and process their own production forests. · firm up the plans and estimates for each of the resettlement livelihood options. As a matter of urgency the GOL needs to: · clarify who will have the overall authority for reservoir management. We recommend that to avoid confusion the authority rest clearly with the Reservoir Management Authority, which should work closely with the provinces and districts, the WMPA and the resettlers. The latter should be directly represented on the RMA management body. · consider whether there may be merit in setting up the RMA as a State Owned Enterprise, largely autonomous and eventually raising its own revenues from being in charge of the clearing of the reservoir area and from its oversight functions in relation to the commercial aspects of the reservoir fishery. The downstream areas: interim measures As a matter of urgency the developers need to pull together reliable data on the totality of the impacts of the project below the dam itself and the precise numbers of people to be affected. This is the zone in which the costs most heavily outweigh the benefits. Greater effort is called for. As a matter of urgency GOL needs to: · coordinate more effectively the various Government agencies planning the use of turbined waters below the powerhouse. The existing Water Resources Committee has no teeth . It needs strengthening. · at the Provincial level (Khammouane), develop further and update the conceptual irrigation plans and prepare them for presentation to potential donors. -31- As a matter of urgency the international development institutions need to: · take up the opportunities offering to make use of the turbined waters to be available and in particular to fund the necessary soil surveys and environmental and social assessments preparatory to working with existing programs for multi- sectoral development in the Nam Kathang and Gnommalat plains. Such interventions offer a relatively straightforward chance for the new Rural Livelihood Program of the World Bank to make an early impact. · work towards a XBF basin-wide multi-sectoral approach consistent with the sustainable use of the natural resources of the basin. As a matter of urgency the developers need to: · firm up quickly the assessments of impacts in the zone and their cost in order that the conflict over what is compensation and mitigation and what is development may be resolved. A third party may be needed to help settle this one. · reassess in particular their case on fisheries impacts on the XBF and its tributaries and rethink their attempt to cap costs before there is a consensus on the magnitude of the impacts. OTHER MAJOR ISSUES A number of uncertainties remain to be addressed in forthcoming overall impact and economic studies. We have several queries about the methodology being employed in the cost/benefit analysis and suggest that the value of the natural services performed by an intact NNT watershed be added to the equation and that the potential benefits of the use of the turbinated waters to be available in the XBF basin be updated and the result included. The preliminary conclusions are encouraging. A zone by zone comment on other issues follows: The watershed The watershed remains in our view the most problematical zone in terms of meeting the project's objectives. The flora is largely intact beyond the inhabited river valleys but a further logging appraisal -32- incorporating satellite surveillance is due and should be undertaken during the next dry season, with or without international participation. The faunal outlook is somewhat less encouraging. The IAG recommends that the existing, but not yet translated into Lao, Saola Plan be updated, translated and put into effect. We also recommend: · continuing to restrict access to the watershed to tracks which will take two-wheel tractors and their trailers and motor cycles but not four-wheel drive vehicles---and orienting the track system as envisaged down towards the reservoir rather than to the north or between river valleys. · investigating the potential of shallow draft aluminium jet boats for opening up river navigation and transport post- inundation. · trying to relieve external pressures on the biodiversity of the watershed by helping lift living standards in the PIZ (see above). · enhancing the unpredictability and level of motivation of the patrollers. · addressing land tenure and resource use rights questions which inhibit non-destructive productivity · addressing population pressures through improved maternal and child health programs, educational work on family planning and birth spacing---and not discouraging voluntary outward migration from the watershed. The above will not be sufficient in themselves to conserve the watershed. The new leadership of the WMPA will have to come up with imaginative new approaches---involving positive incentives---to modify the cultural practices of generations of watershed dwellers. Recruiting the right staff and training and motivating them are important immediate objectives. The plateau The IAG's view is that on present indications the NT2 resettlement may well prove to be one of the most successful aspects of the project. Since resettlements have traditionally been the Achilles' heel of large dam projects this is a brave forecast. It reflects a confidence in the will of those involved to make the operation work. The pilot village is well down the path to success. -33- But lessons from elsewhere suggest that in soils such as those on the plateau cultivation will only be fully productive with continuous inputs. Fertility management and thoroughly researched and tested cropping systems are called for to achieve sustainability. The villagers may need to be convinced that growing their own rice may make little sense in the conditions. It will be important that the resettlers obtain maximum benefit from the catching, processing and sale of the reservoir fish stocks once they recover, as is confidently forecast, from the initial adjustment period after inundation. Reservoir fishing and processing should be restricted to the resettlers by decree and an open marketing system set up so that no marketing monopoly is established. Downstream of the powerhouse The basin-wide approach to development we advocate above will not be easy to achieve given the decentralized system in place in Laos. It nevertheless makes good sense. The results of a hydrology study underway will give some indication of heightened flooding risks from the project down to the Mekong and of impacts on agriculture. There may well be implications for the Concession Agreement. NATIONAL ISSUES The two big national issues, closely linked, are capacity building and implementation. Neither is easy to get a handle on. Seven years down the track we have still not seen the comprehensive capacity building plan we called for in our first report. Existing capacity is not always being fully utilized. The GOL needs to address the loss of credibility it suffers from the lack of budgetary and other support to key agencies like STEA. While encouraged by the new activity around capacity building at the national level we would note that there are substantial training requirements at the project's grassroots level. The WMPA Secretariat has a big task on its hands here. The expected implementation plan will need to be transparent, with respective roles clearly spelled out, supervision arrangements set out in detail, monitoring and evaluation systems incorporated and expenditure and revenue use verifiable. Because they are to be so heavily involved we support the case being made for the relevant provinces to "sign off" on aspects of the project plans and agreements. -34- Finally, while the IAG still feels that there is a case for an eventual trans-boundary World Heritage site incorporating the NNT NBCA and the Vu Quang National Park in Vietnam, it does not regard seeking World Heritage status as a high priority at this time. ----------------------------------------------------- -35- APPENDIX 1 WORKING PROGRAM OF IAG: FEBRUARY/MARCH 2004 § 14 February IAG assembles in Vientiane, Laos PDR § 15 February o pm - Meet with Panel of Experts, followed by meeting with Robert Mertz and with World Bank Mission § 16 February o am - Meet with World Bank/Asian Development Bank/Agence Francaise du Developpement Safeguards Mission to review environmental aspects of basic NT2 documents o pm- Meet with NTCP Project Director Jean Dulac, Technical Director Peter Goldston and Adviser Loy Chansavat o evg - Presentation on cost/benefit analysis by Benoit Laplante, World Bank adviser § 17 February o am - Meet with Natarajan Ishwaran, Chief, Natural Heritage Section, World Heritage Centre. o Meet with WB/ADB/AFD Mission to review social aspects of basic NT2 documents o Noon - Meet with Michael Hedemark and Arlyne Johnson, Wildlife Conservation Society's Program Co-Directors in Laos o pm - Meet with WB Country Director (Bangkok), Ian Porter and Enrique Crousillant, Country Manager o evg - Brainstorming on cumulative impact assessment § 18 February o am - Meet with Stephen Schoneberg (WB, Cambodia-based) on planned WB Rural Livelihoods Program for Xe Bang Fai o Meet with WB/ADB/AFD Mission to review SEMFOP document(watershed operational plan) o pm - Meet with Somdy Douangdy, Vice Minister of Finance, Ministry of Finance -36- o Meet with UNDP Resident Coordinator, Finn Reske-Nielsen o Evg - Meet with Dr. James Chamberlin, anthropologist § 19 February o am - Meet with Tony Whitten WB o Meet with Mrs. Khempheng Pholsena, Vice Minister, Ministry of Foreign Affairs o Meet with Adrian Fozzard, Senior Public Sector Specialist, WB o pm - Meet with Dr. Maydom Chanthanasinh, NT2 Project Director, Hydropower Office o Meet all NT2 parties for wrap up session § 20 February o am - Meet with Bounthong Xaisida, Deputy Director, Ministry of Agriculture and Forestry (Head of Planning, Irrigation Department) o Meet with Oneneuane Phommachanh, Minister of Industry o noon -Meet with Tony Whitten WB and Roland Eves, WWF o pm - Meet with Deputy Prime Minister Thongloun Sisoulith, Chair of Central Planning Committee [ Emil Salim departs] § 21 February o Drive to NTPC Guest House at Nakai (6 hours) o pm - Meet with Nakai District Governor o Visit Pilot Village § 22 February o am - Drive to Lat Koy ( Army Camp) o pm - Visit Theun Duane Demonstration Farm, Ban Ka Oy and Ban Sop On § 23 February o am - Drive to Nam Kathang and Gnommalat plain, visiting villages of Kheung Lek and Na Veung o pm - Drive along foot of escarpment, visiting villages of Thatot and Vang Yien -37- o Meeting with senior WMPA staff, including Sangthong Sonthammakoth, Acting Director and Bounsalong Southidara, Deputy Director § 24 February o am - Drive to Thakkek, lunch with Deputy Governor of Khammouane Province, Oday Soudaphone and Maniveng PhetOudom, National ECRU Director o pm - Drive to Laksao o evg - Dinner with Chief of Khamkeut District § 25 February o am - Drive to Ban Nameung village, meet villagers, survey area, including climb to primal forest. Stay overnight in village. § 26 February o am - Drive to Ban Nakadok and meet with villagers, survey area. o pm - Return to Vientiane § 27 February o Writing report § 28 February o Writing report. Dick de Zeeuw departs. § 29 February Writing report § 1 March o Writing report § 2 March o Fly to Hanoi (Scudder and Talbot of POE, McDowell of IAG, Santhong and Bounsalong of WMPA) § 3 March o am - Meet with Ha Cong Tuan, Deputy Director General of Forest Protection Department of Vietnam, Ministry of Agriculture and Rural Development and Do Quang Tung, Director, Nature Conservation Division, FPD -38- o pm Drive to Vinh -39- § 4 March o Drive to Ha Tinh, meet FPD Provincial Officials and Ha Tinh Foreign Relations Department official o pm - Drive to Vu Quang town, meet Vu Quang catchment management officials § 5 March o am - Meet Vu Quang District Administration officials o pm - Meet Song Thiam Watershed Management Board and drive to Ban Dottien Trang commune for discussions with chair and others § 6 March o am - Drive to Saola Camp 2 in Vu Quang National Park, climbed to 2,400 feet through regenerating forest o pm - Return to Saola Camp, drive to Ha Tinh to overnight § 7 March o am - Drive to Route 8 border post (with Laos). o pm - Drive down Ho Chi Minh Highway to beyond Vinh and thus to Hanoi § 8 March o Meet with FPD officials for farewell wrap-up session. § 9 March o Depart Vietnam: conclusion of mission. -40- APPENDIX 2 LIST OF PERSONS MET (BUT NOT RECORDED IN THE ABOVE PROGRAM) AGENCE FRANCAISE DU DEVELOPPEMENT Naig Cozannet Olivia Dabbous, social expert Patrice Caporossi, investment ASIAN DEVELOPMENT BANK Ruwani Jayawardene, Compliance(Indigenous Peoples) Marla Huddleston, Safeguards Indira Simbolon, Compliance(Indigenous Peoples) Pam Tansanguanwong, consultant(social/consultations) Woochong Um, Project Manager, Mekong Department Sadiq H.Zaidi, adviser, consultant for NT2 project WORLD BANK Cyprian Fisiy, Sector Manager-Social Development,ESDU Valerie Hickey, Environment and Social Development Sector, EAP Suman Babbar, Senior Adviser, Project Finance and Guarantees NORPLAN -41- Stephen Sparkes, Senior Social Scientist -42-