By: Maureen Harris, Programs Director

This article originally appeared in The Myanmar Times

The International Finance Corporation’s Vikram Kumar published a letter in the September 20 Myanmar Times in response to an article on civil society and community boycotts of IFC-sponsored consultations on hydropower in Shan State.

The consultations form part of a cumulative impact assessment of proposed hydropower in the Myitnge basin.

In particular, Mr Kumar took issue with a civil society description of the consultations as “a box-ticking exercise” to prepare for dam-building, including on the Namtu River – the upper reach of the Myitnge River. The IFC letter asserted that, “The IFC is not promoting projects through this process but rather studying their potential environmental and social impact.”

Peeling Back the IFC

That statement is disingenuous. The current assessment follows the release last year of the Strategic Environmental Assessment (SEA) on hydropower in Myanmar, a two-year study led by the IFC in collaboration with Myanmar’s environmental and energy ministries. 

The IFC is the private sector lending arm of the World Bank, with a mandate to promote development through private investment. The IFC’s work on the SEA falls within the scope of its hydropower advisory programme in Myanmar, through which it helped establish the Hydropower Developers’ Working Group and provides ongoing support to the sector through lending and advisory services.

The IFC’s mandate in Myanmar draws on its experience in Laos, where similar support to the hydro sector has provided a backdrop to a rapid escalation in dam-building. Laos’ hydro boom has prompted expressions of concern – including from the United Nations special rapporteur on extreme poverty and human rights – over the sector’s ecological and social impact and contribution to increased poverty and vulnerability for some groups.  

The SEA is an important tool for considering the environmental and social effects at the policy level before decisions are made on individual projects. An SEA should be an independent and open process with input from diverse stakeholders.

Observers raised questions over the suitability of the IFC leading the SEA in Myanmar because of its agenda of promoting private sector investment – meaning potential bias toward a development model that favours large-scale projects over less environmentally and socially destructive ones.

The final SEA produced some important findings and recommendations. Among these is mainstream reservation of Myanmar’s major river basins, in line with best practices in maintaining ecosystem functions and healthy rivers.

Another significant recommendation is to propose a “sustainable development framework” (SDF) for hydropower development in Myanmar.  

However, the study’s framing around “sustainable hydropower” assumes a key role for large-scale hydropower in the country’s energy plans, and does so without examining broader energy options and needs. Further, “sustainable hydropower” is a term that is promoted by the hydropower industry and the IFC, but is highly contested, and can downplay serious effects on people and ecosystems that often cannot be effectively mitigated.

A key component of the SDF is basin “zoning” – identifying priority and no-go areas for hydropower. In the SEA, sub-basins across the country were accorded high, medium, or low values, with medium- and low-value sub-basins deemed suitable for potential dam construction.  

But there are significant concerns as to how these values were derived. While the SEA examined conflict, social and livelihoods risks, these were omitted in the basin zoning plans, leaving only biophysical themes to inform the rankings. This has resulted in the SEA designating some conflict-prone sub-basins as a priority for hydropower development.

This is the case for the Namtu in the upper Myitnge sub-basin, which was ranked “medium,” despite the finding that conflict, social and livelihood risks were high.

Centering Human Rights

Conflict and human rights concerns are therefore not addressed at the overall policy level, but further along in the decision-making process, including through proposed conflict sensitivity assessments for individual projects. Further, the cumulative impact assessment terms of reference make no mention of conflict.  

Addressing conflict at this lower stage of decision-making rather than at the policy level runs counter to local people’s demands and aspirations. As stated in the original article, Shan groups are calling for a moratorium on all new dams in ethnic areas until armed conflicts halt, and constitutional rights are secured for ethnic people to protect their natural resources, including rivers.

While stronger social and environmental requirements are important, it is critical that these are not viewed merely as a step toward obtaining project approvals.

First and foremost, standards should uphold the rights of local people and affected communities to self-determination. This means meaningful participation in decision-making, rather than the more passive and largely powerless practice of “consultation.” It means space for local people to assert their rights and desires – to use, preserve, manage and protect their own rivers and territories as they see fit, along with their food sources and livelihoods.