Promoting ‘Smart Development’ in the Mekong Region
IFC is working to better understand cumulative environmental and social
impacts of hydropower development on the Nam Ou River.
Photo ©Tessa Bunney
Over 300 million people inhabit the Greater Mekong Subregion. For the majority of this population, the river’s vast ecological system is their main market place, since they rely on it for food security, trade, transport, and their livelihoods.
As the region’s water resources continue to be developed by the hydropower sector, encouraging sustainable growth is vital. In river basins where multiple projects are planned, companies should consider working together to address the cumulative impacts that are likely to result.
“We’re here to help promote ‘smart development’ of the Mekong and its water resources,” said Alfred Nakatsuma, Director of USAID Asia’s Regional Environment Office. “It’s an ambitious goal, so we’re going to have to all work together.”
Nakatsuma challenged his audience to help promote responsible investment and sustainable development at a late-August symposium attended by over 100 stakeholders from around the region. The USAID-supported Mekong Partnership for the Environment brought together NGOs, civil society organizations, government representatives, donors and the private sector to discuss ways of improving environmental and social standards, within the broader context of the emerging ASEAN Economic Community.
Discussions focused on ways to improve environmental impact assessments (EIAs) to better manage project risks and ultimately lower impacts. For IFC, improving the quality of environmental impact assessments includes understanding the bigger picture. This includes the cumulative impact on communities, flora and fauna, when a series of developments occurs within the same river or watershed.
“The private sector has an important role to play in environmental and social risk management, and also has an opportunity to be a trend setter,” said Kate Lazarus, Senior Operations Officer at IFC. “While we work toward improving EIAs, we need to also consider the cumulative impacts multiple projects can have in a single river basin and how to best mitigate them.”
Over 40 professionals from related fields attended Lazarus’ presentation, which discussed perspectives from the private sector and why putting in place effective environmental and social standards are good for business.
IFC’s Performance Standards stress the importance of assessing and managing environmental and social risks and impacts and recognizes that projects may have greater impact or increased risks due to other developments nearby. In cases where there may be incremental impact on areas or resources used or directly impacted by a project, or several hydropower projects are planned for a single river basin, IFC recommends that developers conduct a cumulative impact assessment in addition to the required EIA. The aim is to help clients better understand and manage the extent to which their project contributes to overall cumulative impacts.
Nearly three years after its inception, IFC’s first advisory program focusing on raising environmental and social standards in the hydropower sector is taking a lead in policy-level guidance and capacity building throughout the region. The program offers training in IFC’s Performance Standards, aiming to create more awareness of the business case for sustainability, while working with the private sector to strengthen accountability.
“Change happens by involving all stakeholders,” said Christy Owen, Chief of Party, Mekong Partnership for the Environment, which is led by Pact. “Now, how do we make these commitments a reality?”
To learn more about IFC’s six-step process to assist private sector companies in emerging markets identify and manage cumulative impacts click here.
