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Plenty of aid, but is it for a 'Greater' Mekong?

By Andrew Hewett - posted Wednesday, 10 October 2007

His name is Bunlaamb and he lives on the banks of the usually-sanguine Se San River in north-eastern Cambodia. But for the last seven years, the life of this farmer-fisherman, and the rest of his village, has been turned upside down by sudden water fluctuations caused by a series of large hydropower dams built upstream, on the Vietnamese side of the border.

"People used to be very happy. They were able to catch fish from many places. But then floods started. At first, we didn't know why the flooding happened. When we returned to our village after the flooding, our rice fields were destroyed and our chickens washed away. Villagers are scared now, many people have moved away.”

Bunlaamb’s story is illustrative of the plight of scores of rural communities across the Mekong region where there is a massive program of hydropower development currently underway. This is largely the brainchild of the Asian Development Bank (ADB), which over the last decade and a half has spearheaded a grand vision of “regional integration” for the six Mekong countries, essentially seeking to form them into one borderless economy- the Greater Mekong Subregion.


Key to this process are large scale infrastructure developments - trans-national highways, hydropower dams, regional energy grids and river dredging for heavy freight barges. As a result the region’s economies are booming, but at what cost? Communities of poor, marginalised and ethnic minority groups seem to have been the main casualties along the way.

At the end of September delegates from mainland South-East Asia and Australia gathered at the University of Sydney for a major conference on development in the Mekong Region (Laos, Cambodia, Thailand, Vietnam, Burma and southern China). And one of the key questions there should have been: when does Australian overseas aid bring about positive changes for poor people and when can it actually have negative impacts upon their quality of life?

The role of Australia’s aid program in the Mekong region was brought sharply into focus. Last week Oxfam Australia released a report, examining the negative impacts of economic change in the Mekong region. One of the most important findings is that while average incomes may be rising, many of the rural poor (and especially ethnic minorities) are actually experiencing declining quality of life. This is mainly due to the destruction of the forests and rivers upon which they depend for food, drinking, housing, medicines and so on.

For example, in Sekong Province in Laos people derive enormous benefit from the forest, even though average annual incomes are little more than $150 per year. If they lose access to forest resources (which is rapidly happening), it would take a rise in annual income of more than $600 to stop a decline in their standard of living.

The report highlights the high level of economic vulnerability of ethnic minorities in the face of new markets and commercial industries.

An investigation by Oxfam Australia into a series of ADB infrastructure projects found that although the Bank had policies which were supposed to safeguard the poor and the environment, “the ADB’s capacity to implement, monitor and generally comply with its own policies is questionable”. Moreover, there are concerns that the Bank is actually trying to weaken its existing safeguard policies.


Into this mix, the Australian Government is promising a remarkable commitment of $40-50 million each year for the ADB’s Greater Mekong Subregion Program, predominantly for infrastructure projects.  Increased aid is often presented as a self-evident good, but will it really alleviate poverty? Will it be the right sort of aid? While there are some indications that AusAID is trying not to replicate some of the ADB’s shortcomings - for example, it will focus on small-scale energy decentralisation, not massive dams - there is cause for concern.

AusAID’s safeguards policies for infrastructure projects are actually weaker than the ADB’s, and, unlike the ADB, AusAID has no independent complaints mechanism - not a good basis for Australia to embark on major infrastructure financing.

The Australian Government has an obligation to ensure its new aid program in the Mekong makes a positive contribution, and does not actually create or perpetuate poverty. It should at least undertake a thorough assessment of the economic vulnerability of rural communities (especially ethnic minorities) that may be brought about by infrastructure development - communities know best what works for them. And it should introduce clear and strong policies safeguarding the environment, the indigenous and relocated people from adverse impacts of infrastructure development. This must include an easy-to-use independent complaints mechanism.

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About the Author

Andrew Hewett is Executive Director of Oxfam Australia.

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