By JAMES HOOKWAY
The Wall Street Journal
BANGKOK—A contentious $3.5 billion dam project on the Mekong River was put on hold again Thursday as nations called for further study of the environmental effects, a setback for Laos's plan to reinvent itself as the hydropower battery of Southeast Asia.
The Mekong River Commission, comprising Cambodia, Laos, Thailand and Vietnam, said in a statement that member governments had agreed to study the implications on the Xayaburi dam project further before giving Laos the go-ahead to continue construction—the second delay to the project this year.
The commission didn't say how long the study would take. "Further study will provide a more complete picture for the four countries to be able to further discuss the development and management of their shared resources," said Lim Kean Hor, chairman of the Mekong River Commission's council and Cambodia's minister for water resources.
Government officials in Laos couldn't immediately be reached to comment, nor could representatives at one of the project's main contractors, Thailand-based Ch. Karnchang PCL.
While Laos views the dam as an opportunity to become a power-generating hub for the region and help combat chronic poverty, opponents say the project jeopardizes a key food source for millions of people. Environmentalists and other activists warn that the Thailand-financed Xayaburi project will disrupt the migratory patterns of fish in Cambodia and block crucial, nutrient-rich sediment flows to the rice-growing Mekong River Delta in southern Vietnam.
Many also worry that approving Laos's plans could accelerate other nations' construction of as many as 10 more planned dams on the lower reaches of the 4,900 kilometer-long Mekong River.
The four-member Mekong River Commission's decisions aren't binding on any individual member, but regional analysts say Laos, the smallest and poorest country in the Mekong region with an economic output of around $6.34 billion a year, is wary of pushing ahead with the Xayaburi project if it is objected to by more-powerful members—especially Vietnam, with a gross domestic product of about $103 billion and 16 times as many people.
Already, Vietnam has called for a 10-year moratorium on the construction of new dams on the river until their consequences are better understood. Silt-flows to the fertile Mekong River delta are slowing because of the construction of other dams further upstream in China, and scientists from the U.S. Geological Survey, among others, warn that at as a result, salt water is now encroaching into the delta farther than before, threatening the survival of large tracts of prime rice-growing land.
Cambodia also has expressed its concern about how the Xayaburi dam could divert migrating fish and deplete fishing grounds. Environmentalists say Cambodia's food security could be compromised if the project goes ahead; Cambodians rely on fish from the Mekong river system to supply around 70% of their protein requirement. Berkeley, Calif.-based advocacy group International Rivers contends that the dam also threatens the survival of endangered species such as the Mekong Giant Catfish.
Thailand, which will buy around 95% of the power generated by the proposed Xayaburi dam, is keeping out of the debate. The country's energy minister Preecha Rengsomboonsuk said last week that the dam is Laos's internal affair and that Thailand's won't intervene.
Write to James Hookway at james.hookway@wsj.com
Corrections & Amplifications
Scientists from the U.S. Geological Survey have warned about the environmental impact of dams on the Mekong River. A previous version of this article said the scientists were from the U.S. Geographical Service.
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