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May 8, 2002

Mr. Shinozawa Kyosuke
Japan Bank for International Corporation (JBIC)

1-4-1 Otemachi, Chiyoda-ku, Tokyo

Japan 1008144

Re: Request not to fund a proposal

submitted by Sanyu Consultants Inc., Japan

to comprehensively study water resources along Mekong tributaries

Dear Governor Shinozawa Kyosuke,

We, the undersigned People's Organizations (POs), Non-Governmental Organizations (NGOs), and Academic Institute in Thailand, have recently learned that the Japan Bank for International Cooperation (JIBC) is considering to finance a study proposed by Japan-based Sanyu Consultants Inc. to study water resources along Mekong tributaries, namely Menam Chi in Thailand and Xe Bang Hiang, Nam Hinbun, Xe Don, and Xe Bang Fai in Lao People's Democratic Republic (PDR). We are very much concerned over this study, for it gives high priorities to a water diversion scheme, which is identical to Laos-Thai Friendship Water Development for Sustainable Agriculture proposed by the same consultant in 1998.

Under this scheme a dam construction is proposed on Xe Bang Hiang in Savannakhet, Lao PDR, along with a tunnel that goes under the Mekong River to divert the water from Lao PDR to Amnart Charoen Province in Thailand. Such a huge-scale project will inevitably have far-reaching harmful environmental and social effects in both countries. They can be summarized as follows:

Anticipated impacts in Lao PDR:

1) The water diversion project will involve resettlement of people in a number of villages located in the planned reservoir area;

2) The construction of a dam would block the migration route of fish species that swim upstream from the Mekong River to spawn in Xe Bang Hiang, resulting in disruptions of both the ecological system and the life cycle of the fish in Mekong and Xe Bang Hiang rivers;

3) The planned reservoir will flood the villagers' farming areas; and

4) The construction of a large-scale dam would put the safety of the area at risk, because it must store a large amount of water, especially in the rainy season.

Concerns in Thailand

    1. Soil salinization: Diverting a large amount of water to Northeast Thailand would definitely increas the area of saline soil, which has already been one of the major problems in the region. The case of Rasi Salai Dam in Si Sa Ket Province shows that soil salinization has spread into the farm land in the upland area because the salinized water in the reservoir has been used for irrigation. Moreover, the salt layer underneath the ground has been dissolved by water from irrigation system and it has destroyed farmland.
    2. Economic feasibility: Farmers in Northeast do not normally have a water shortage problem. There are two types of farming in Northeast Thailand: the rain-fed farming on the upland area in the rainy season; and farming in the flood plain, usually located in the lowland area, in the dry season. The latter type of farming is fed by the remaining water from marshes in and around seasonally flooded forests. In some areas, where the land is very low, the flooded forest could retain water sufficient to grow rice and other commercial crops. This makes us seriously question if a costly water divergent project is really necessary.

Due to meteorological constrains in Northeast Thailand, a dry land area, harvesting rice twice a year in the higher ground area is unsustainable. The dry land in the Northeast cannot absorb the water outside the rainy season in order to retain sufficient moisture to enable rice seeds to grow fully. Therefore, farmers will not be benefited from an irrigation scheme such as that proposed in the Laos-Thai Friendship Water Development for Sustainable Agriculture.

There has also been enough evidence from the World Bank funded Pak Mun Dam in the adjacent Ubon Ratchathani Province that the dam has failed to provide the promised irrigation benefits for farmers in the higher ground area. This is because these farmers do not feel the need to grow rice twice a year and thus would refuse to pay an irrigation fee. The economic viability of an irrigation dam is therefore extremely doubtful.

We understand that JBIC has recently publicized its new environmental and social guidelines for projects and programs it finances. We take this as JBIC serious step moving towards a more environmentally-friendly, accountable, and transparent institution. As we have shown above, the proposed study is advocating a project which is not compatible at all with environmental and social concerns to which JBIC is committing.

We are annoyed by the way Sanyu Consultant Inc. has come to propose this study, for it is assuming as if a water diversion scheme were the only possible alternative to develop the areas under focus. It also hides its real intention, i.e., that to build a large-scale dam and a tunnel, under the disguise of comprehensive study of water resources. The same company has also conducted a feasibility study of another mega-scale water divergent project to link three northern Thai rivers, Kok, Ing, and Nan, causing much concern and resistance among villagers, POs and NGOs. We cannot possibly have any faith in the study that such a company is proposing to conduct.

We would like to this opportunity to urge Governor Shinozawa and JBIC to take into serious consideration what we have said so far and not to finance a proposal submitted by Sanyu Consultants Inc. to study water resources along Mekong tributaries in Thailand and Lao PDR.

Thank you very much for you time and consideration.

Sincerely yours,


Assembly of the Poor

Association for Community and Ecology Development (ACED)
BIOTHAI: Biodiversity and Community Right Action Thailand

Club for Nature Conservation and Restoration in the Ing River Basin

Club for Conservation and Recovery the Songkam River Basin

Community Forestry Fund

Ethnic Study Network

Friends of the People (FOP.)

Kwan Muang Institute

NGO Coordinating Committee on Development
Northern Watershed Development by Community Organization
Northern Development Foundation
Project for River and Community

Sakonnakorn Civil Society Network

Sakonnakorn Environmental Club

Southeast Asia Rivers Network (Thailand Chapter)
Thai Volunteer Service Foundation


1.JBIC Bangkok Office
14th Floor,Nantawan Building,
161 Rajdamri Road,Bangkok,10330,

2. Mr.Mitsuru Kitano, Director of Loan Aid Division
Ministry of Foreign Affairs

3.Mr.Tatsuo Yamasaki
Director of Development Finance Division
Ministry of Finance


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