In Lao PDR, small hydropower has the potential to be big business. With support from IFC and the Australian government, Lao PDR approved the Regulation on Small Hydropower Development to streamline approvals for projects less than 15 megawatts.
The Jhelum-Poonch Watershed, in South Asia, is home to critically endangered species of fish such as the Golden Mahaseer and the Kashmir Catfish. The basin is also a vast source of hydropower in Pakistan.
IFC Promotes Sustainability of the Hydropower Sector in Lao PDR
The Lao People’s Democratic Republic is one of the least developed countries in Southeast Asia and 28 percent of its people are poor, living below the national poverty line of about $1.50 a day.
However, the country is rich in natural resources, such as land, forests, and rivers. That’s why the government of Lao PDR has identified the development of hydropower as a key way to promote economic growth and alleviate poverty.
Yet developing hydropower puts pressure on the environment and local people’s livelihoods. IFC, through its investments and advisory services, wants to help the country foster sustainable and commercially viable hydropower, while ensuring that the environment is protected and that local people have access to the water resources they depend on.
By offering training and sharing its expertise with the key stakeholders in Lao PDR’s hydropower industry, IFC works to increase the share of new hydropower projects that follow international environmental and social standards.
IFC supports the Ministry of Natural Resources and Environment in improving policies and regulations for the hydropower sector to ensure that new projects adhere to international best practices. [learn more]
In river basins with cascades of hydropower, IFC will partner with river basin committees, local authorities, companies, and civil society organizations to better anticipate, evaluate, and manage the cumulative impacts of hydropower development. [learn more]
Finance institutions from neighboring countries are increasingly investing in hydropower projects in Lao PDR. IFC seeks to assist these banks in developing and adopting environmental and social guidelines for their hydropower investments, which are important risk mitigation tools for them. [learn more]
IFC aims to help hydropower companies adhere to international environmental and social standards, and to strengthen their transparency and accountability by creating a platform for them to share knowledge and engage with the government.
IFC aims to help Lao PDR achieve economic growth through the development of sustainable and commercially viable hydropower projects. We want to support companies that invest in high-standard hydropower projects to boost domestic power supply and export electricity to neighboring countries. IFC’s engagement in hydropower will help elevate environmental and social standards to ensure the sector is profitable, while also benefitting the people and preserving the environment.
As the largest global development institution focused exclusively on the private sector, IFC helps companies broaden their access to foreign capital markets. We provide an integrated package of investment services, including project financing, expertise on construction risks, long tenors, equity, insurance assistance, as well as environmental and social risk management.
Companies seeking to establish a new hydropower venture or expand an existing project in Lao PDR can contact IFC for assistance.