Laos, financial institutions working on hydro project development laws

The International Finance Corporation (IFC) has announced its plan to work with the Laotian government in developing draft laws that would help govern hydroelectric power development.

According to IFC, Laos is one of the poorest nations in southeast Asia, but is amongst the richest in terms of natural resources.

Through the past decade, investments have led to the development of about 20 hydropower projects, with up to 50 expected to be operational by 2025.

This boom in hydro construction has been essential in boosting the country’s socioeconomic growth, IFC said, though it also increases competition among water users, making revisions to Laos’ 17-year old water laws essential.

Currently, hydropower developers are granted water rights through concession agreements. Under the revised law, rights would be granted using a formal, long-term, permit-based system that would be easier to enforce.

“This law provides principles and measures necessary for the management, exploitation, use, development and protection of water resources, aiming to promote legal rights to use water resources that ensure balance and sustainability of socio-economic development and environmental protection,” the draft law said.

The Laos government, with IFC and World Bank support, is in the process of holding public consultations about the draft laws, with stakeholders in all sectors being invited to give their feedback.

IFC said its most recent consultation, which took place in Vientiane last month, drew representatives from 13 hydropower companies and law firms, which discussed issues including dam safety, coordinated water releases and flow management.

“I think the proposed introduction of water permits would be very beneficial for hydropower companies,” said Theun Hincoun Power Company (THPC) general manager Robert Allen, Jr. “Water permits would help us resolve conflicts with other water users and ensure that we have access to the resources our business depends on.”

The first version of the draft water law is available on the Laos Department of Water Resources’ website here. The agency said it will continue soliciting comments about the proposal through the coming months, with a final revision to be submitted to the Laotian National Assembly by the end of the year.

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