41924-014: Nam Ngiep 1 Hydropower Project

Environmental and Social Monitoring Report

Project Number: 41924-014 Independent Advisory Panel (Report No. 13, 2–9 June 2019) July 2019

Lao PDR: Nam Ngiep 1 Hydropower Project

Prepared by Nam Ngiep 1 Power Company Limited for Asian Development Bank.

This environmental and social monitoring report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area. Final July 2019

Report Number 13 of the Independent Advisory Panel on the Nam Ngiep 1 Hydropower Project Lao PDR 13th site visit, 2-9 June 2019

Date: 31 July 2019

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Table of Contents Page no. List of acronyms and abbreviations 3 Introduction 4 Part 1: Independent Advisory Panel Actions 5 Part 2: Summary of IAP issues and recommendations 8 • Summary of Resettlement Issues 8 • Summary of Indigenous Peoples’ Issues 14 • Summary of Biodiversity Issues 22

List of Annexes Annex 1: Resettlement Issues 30 Annex 2: Indigenous Peoples’ Issues 33 Annex 3: Biodiversity Issues 37

List of Photos Resettlement and Indigenous Peoples’ Photos 32

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List of acronyms and abbreviations ADB Asian Development Bank MAF Ministry of Agriculture and Forestry AIP Annual implementation plan m.a.s.l. meters above sea level asap As soon as possible MEM Ministry of Energy and Mines BAC Biodiversity Offset Advisory Committee MONRE Ministry of Natural Resources & Environment BIMOF Biodiversity Impact Mitigation and Offset MRC Mekong River Commission Framework BKX Bolikhamxay Province NAFRI National Agriculture & Forestry Research Institute BOMP Biodiversity Offset Management Plan NBCA National biodiversity conservation area/conservation forest BOMU Biodiversity Offset Management Unit NC/NX Nam Chouane-Nam Xang biodiversity offset area BRP Biomass removal plan NNL No net loss BSP Biodiversity Service Provider NNP Nam Ngiep river CA Concession agreement NNP1 Nam Ngiep 1 hydropower project CDP Community development plan NNP2 Nam Ngiep 2 hydropower project CIA Cumulative impact assessment NNP1PC Nam Ngiep 1 Power Company COD Commercial operating date NPA National protected area CUZ controlled use zone NRM Natural resources management DCC District coordinating committee NTFPs Non-timber forest products DEQP Department of Environmental Quality OP Operational phase Promotion DFO District forestry office PA Protected area DFRM Department of Forest Resources Management PAP Project affected people DG Director-general PAH Project affected household DoF Department of Forestry PFA National protection forest area DONRE District office of natural resources & PHXRA Phouhomxay Resettlement Area (formerly Houay environment Soup Resettlement Area) E&S Environment and social PLUP Participatory land use planning eflow Environmental flow PMO/PO Prime Minister’s Office EGATi Electric Generating Authority of Thailand PONRE Provincial office of natural resources and International Company environment EIA EMP Environmental impacts assessment PPA Provincial protected area Environmental management plan ESMMP-CP Environmental and social management and PRMLCRC or Provincial Resettlement Management and Living monitoring plan-construction period PRLRC Condition Restoration Committee EMO Environmental Management Office RCC Roller Compacted Concrete EMU Environmental Management Unit REMDP/REDP Resettlement and Ethnic Minority Development Plan EPF Environmental Protection Fund RIP Reservoir Impoundment Plan ESD Environment and Social Division RPM Reservoir Management Plan ESIA Environmental and social impacts assessment RMU Resettlement Management Unit FCZ Fish conservation zone ROW Right-of-way FMP Fisheries Management Plan SEA Strategic environmental assessment GOL Government of Lao PDR SMO Social Management Office GRM Grievance Redress Mechanism SPS Safeguard Policy Statement ha hectare TD Technical Division HCCEMMP Head Construction Contractor's Environmental TPZ totally protected zone Management and Monitoring Plan hh household UR Upper reservoir HSK Hatsaykham hamlet US$ United States dollar IAP Independent Advisory Panel UXO Unexploded ordinance IAS Invasive alien species VDC Village development committee ICDP Integrated conservation and development WCS Wildlife Conservation Society project IEE Initial environmental examination WMO Watershed Management Office IFC International Finance Corporation WMP Watershed management plan IP Indigenous people WRPC Water Resources Protection Committee ISP Integrated spatial planning/Invasive species WRPO Water Resources Protection Office program IUCN International Union for Conservation of Nature WWTP Wastewater treatment plant IWMP Integrated watershed management plan XSB Xaysomboun Province LR Lower reservoir LTA Lenders’ technical advisors

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Report Number 13 of the Independent Advisory Panel on the Nam Ngiep 1 Hydropower Project Lao PDR 13th site visit, 2-9 June 2019

Introduction

1. The 13th field visit of the Independent Advisory Panel (IAP) to the Nam Ngiep 1 (NNP1) hydropower project was comprised of Mr. Anthony M. Zola, Resettlement Specialist, Chairman; Mr. Songwit Chuamsakul, Indigenous Peoples (IP) Specialist; and, Mr. Will Duckworth, Biodiversity Specialist. Mr. Richard Frankel, the Environment Specialist continues to support the IAP by reviewing environment-related documents at his home office, but no longer participates in IAP field visits. The IAP was pleased to work with representatives of the Asian Development Bank (ADB) during the field visit, including Ms. Jocelyn Erlinda Munsayac, Principal Safeguards Specialist; Ms. Kristy L. Harrison, Senior Safeguards Specialist, PSOD; Ms. Elizabeth Mann, senior social safeguards expert (ADB staff consultant); and, Mr. Raoul Cola, Lenders’ Technical Advisor (LTA), Social Expert .

2. The IAP noted progress in several areas during the site visit: • IAP recommendations continue to be implemented effectively. • The management team of the Nam Ngiep 1 Power Company (NNP1PC) is providing strong leadership for implementation of environment and social activities. • Management of social and livelihood development activities continues to be professional and systematic. • NNP1PC continues to have good relations with key agencies of the Government of Lao PDR (GOL). Bolikhamxay and Xaysomboun provincial officials are satisfied with the level of cooperation and coordination with NNP1PC. • The lives of resettler and self-resettler families interviewed by the IAP and LTA appeared to be stable, with a return to normal living and livelihood patterns, and satisfaction with NNP1PC livelihood restoration and social development activities. • Many serious land issues have been settled at the Phouhomxay resettlement area (PHXRA) and the Hat Gniun host village as a result of completion or near completion of participatory land use planning (PLUP) by Bolikhamxay provincial and Bolikhan district officials. • NN1PC informed the IAP that draft guidelines on use of the post-COD Community Development Fund have been formulated and are being discussed with GOL. • Some additional progress has been made at the NC/NX offset site under the pre- BOMP activities.

3. The IAP is concerned about the following challenges that NNP1PC is facing: • The IAP sees the lack of an operational Emergency Preparedness and Response Plan / Emergency Action Plan (EAP) and the non-conduct of emergency drills in downstream villages as the most serious challenges facing NNP1PC. A comprehensive EAP for the Operations Phase (EAP-OP) of the Nam Ngiep 1 Main Dam, Re-regulating Dam, PHXRA Irrigation Dam, and any auxiliary (saddle) dams or similar structures. • Delayed compensation payments to PAP for project lands expropriated by the GOL early in project implementation, with six households claiming additional land

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compensation; and, PAP from Hat Gniun requesting to apply Xaysomboun Provincial Decree number 1003 for the whole project affected area, over-riding Bolikhamxay Provincial Decree number 031 regarding compensation applied to the main dam and powerhouse access road. • Delays in repairing or improving agricultural infrastructure at PHXRA. • The quality of water supply continues to be an issue at PHXRA. • Reports of self-resettler encroachment in the Nam Ngiep watershed. • Lengthy delays in finalising the two areas’ management plans and in particular bringing on board the suitably experienced BSP are of major concern. The conservation status of the two areas’ biodiversity can safely be predicted to have declined. At the start of full implementation, now expected to be within 2019, the starting position is well below ‘level’.

4. This report consists of two parts: Part 1 presents the activities and actions of the IAP; and, Part 2 presents a summary of the resettlement, social, and biodiversity issues related to construction of the Nam Ngiep 1 hydropower project, presented in a matrix format. Three separate annexes present additional comments of individual members of the IAP.

5. This report was edited by Mr. Anthony M. Zola, the Resettlement Specialist and Chairman of the IAP. The annexes were written by individual members of the IAP.

Part 1: Independent Advisory Panel Actions

6. The Independent Advisory Panel (IAP) for the Nam Ngiep 1 hydropower project (NNP1) in Lao PDR undertook a twelfth visit to NNP1 on 2-9 June 2019. The IAP members participating in the twelfth visit included the following: • Mr. Anthony M. Zola, Resettlement Specialist, Chairman • Mr. Songwit Chuamsakul, Indigenous Peoples (IP) Specialist • Mr. Will Duckworth, Biodiversity Specialist • Mr. Richard Frankel, Environment Specialist (not participating in the IAP site visit)

7. The role of the IAP was extended until 2021. Membership of the IAP was change, with Mr. Will Duckworth replacing Ms. Kathy MacKinnon as the biodiversity specialist and Mr. Richard Frankel’s participation as environment specialist, limited to reviewing technical environmental documents.

8. The IAP proposed to NNP1PC that the 14th IAP site visit would be on 8-15 December 2019. This visit is timely for the resettlement and social specialists as PAP (both resettlers and self-resettlers) will have completed harvesting the 2019 wet season rice crop.

9. This IAP report to NNP1PC and the ADB covers the following topics: (i) issues of concern to the IAP; and, (ii) IAP recommendations for actions to NNP1PC based on the Concession Agreement, official / legal documents of the Government of Lao PDR (GOL), ADB Safeguard Policy Statement (2009), Equator Principles, and international best practices. Actions recommended by the IAP are time-based; meaning that NNP1PC is either legally obligated to or should undertake and/or complete these actions within a specific period.

10. The IAP categories of concern are as follows:

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• High / Very High / Urgent category of concern: The Project should act immediately; • Medium category of concern: The Project should act within 1-2 months; and, • Low category of concern: action should be taken before the next IAP visit.

The categories of concern are consistent with those applied at other international standard hydropower projects in Lao PDR.

11. Copies of this IAP report will be submitted to the following individuals: (i) Mr. Toshihiro Takano, Managing Director, NNP1PC (ii) Mr. Vilayhak Somsoulivong, Deputy Managing Director, NNP1PC (iii) Mr. Karan Raj Gulshan, Asian Development Bank, Private Sector Operations (iv) Ms. Jocelyn Erlinda S. Munsayac, Asian Development Bank, Principal Safeguards Specialist (v) Ms. Kristy L. Harrison, Asian Development Bank, Senior Safeguards Specialist

12. The 13th IAP site visit was undertaken over a seven-day period; from Sunday, 2 June to Sunday, 9 June 2019. The IAP itinerary was as follows:

Date Activity Saturday, • Arrival in Vientiane: Mr. Songwit. IAP discussions about Phong indigenous 1 June 2019 peoples and biodiversity issues. • Overnight in Vientiane Sunday, • Arrival in Vientiane: Mr. Zola, Mr. Duckworth 2 June 2019 • IAP kick-off meeting at Hotel Khamvongsa, Vientiane • Overnight in Vientiane Monday, • Briefing by NNP1PC managers and staff for IAP at the Nam Ngiep 1 3 June 2019 Hydropower Project office in Vientiane on (i) measures taken related to actions recommended by the IAP during the eleventh IAP site visit in December 2018; and, (ii) overall progress on NNP1 project implementation and issues of concern • Afternoon: IAP Resettlement and ADB Social Team travel to Long Xan • Afternoon: IAP Resettlement and ADB Social Team: Met the Vice Chairman of the Xaysomboun PRLRC and RMU to review resettlement activities for PAP from 2LR. Overnight in Long Xan. • Afternoon: IAP IP and Biodiversity specialists travel to biodiversity offset site in Viengthong District, Bolikhamxay Province; overnight in Viengthong Tuesday, • IAP IP, LTA Social, ADB Social Team, and Biodiversity specialists: Meetings 4 June 2019 with Phong ethnic groups in Ban Nathan, Viengthong District, Bolikhamxay Province • Afternoon: Travel to Thathom District, Xaysomboun Province • Afternoon: IAP Biodiversity Specialist: Meeting with BOMU team and overnight in Viengthong District, Bolikhamxay Province • Morning: IAP Resettlement and ADB Senior Social Safeguards specialists: Meeting with Hom District Governor • Morning: IAP Resettlement and ADB Senior Social Safeguards specialists: Meeting with self-resettlers at Ban Nam Khiene, Hom District, Xaysomboun Province • Afternoon: IAP Resettlement and ADB Social Team: Meeting with 4 of 7 former hold-out self-resettlers at Ban Hom Thad, Hom District, Xaysomboun Province • Afternoon: IAP Resettlement and ADB Social Team: Travel Long Xan to Paksan, Bolikhamxay Province; overnight in Paksan Wednesday, • Morning: IAP Resettlement Specialist and ADB Social Team meeting with RMU 5 June 2019 Chairman in Paksan, Bolikhamxay Province

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Date Activity • IAP Resettlement Specialist and ADB Social Team at PHXRA: (i) received a briefing on resettlement issues and livelihood activities; (ii) met with PAP in a general meeting; and, (iii) met with Lao Labor Union, Social Welfare, and Police representatives on social management issues • IAP Resettlement Specialist met with Ban Hat Gniun village development committee and PAP representatives; travel to Paksan, Bolikhamxay Province; overnight in Paksan • ADB Social Team met with 5 of 6 households who submitted complaints to ADB requesting to apply XSB Provincial Decree 1003 for entire project affected area, overriding BKX Provincial Decree 031 regarding compensation applied to the access road to the main dam and powerhouse. • IAP IP Specialist and LTA Social: Met NNP1PC staff at Zone 2UR; Met village authorities and visited livelihood restoration activities and broken suspension bridge at Phiengta, Hatsamkhone, Pou villages Zone 2UR, Thathom District • IAP IP Specialist and LTA Social: Met village authorities and PAP IP Hmong self-resettlers at Vanghai (Pakyong Cluster), Thathom District, Xaysomboun • Morning: IAP Biodiversity Specialist: Travel to Anouvong District, Xaysomboun. Thursday, • Morning: IAP Resettlement Specialist and ADB Social Team met with PAP in 6 June 2019 Nampa, Songkhone, and Nam Ngiep villages re: downstream NNP1 impacts • Afternoon: IAP Resettlement Specialist and ADB Social Team met with PAP in Thongyai village • Morning: IAP IP Specialist traveled from Thathom District, Xaysomboun Province to meet with self-resettlers in Ban Wa • Afternoon: IAP IP Specialist and LTA Social met with PAP Bo and Nahan villages; Travel to Paksan; overnight in Paksan • Morning: IAP Biodiversity Specialist: Met with PAFO Director, Xaysomboun Province • Afternoon: IAP Biodiversity Specialist: Travel to Paksan Friday, • Morning: IAP Resettlement Specialist and IP Specialist (IAP Social Team) and 7 June 2019 ADB Social Team meeting with Bolikhan District Governor, Bolikhamxay Province • IAP Social Team and ADB Social Team debriefing for SMO in Paksan • IAP and ADB social teams travel to Vientiane; overnight in Vientiane • Morning: IAP Biodiversity Specialist: Travel from Pakxan to Vientiane • Afternoon: IAP Biodiversity Specialist: Work on presentation and report Saturday, • Morning: IAP meeting to discuss priority issues discovered during site visit 8 June 2019 • Morning: IAP prepares PowerPoint presentations for debriefing of NNP1PC • Morning: IAP Biodiversity Specialist: Attend presentation to NNP1PC and ADB by lead candidate for Biodiversity Service Provider position • Afternoon: IAP debriefing and presentations to NNP1PC management, ADB, LTA Social Specialist • Overnight in Vientiane Sunday, • Morning: IAP wrap-up meeting to discuss priority issues and report preparation 9 June 2019 • Afternoon: Zola and Songwit travel to home bases Monday, • Morning: Duckworth works on IAP report 10 June 2019 • Afternoon: Duckworth travels to home base

13. The 14th IAP site visit is proposed for 8-15 December 2019.

14. The remainder of this report consists of the following: (i) Part 2: a summary of resettlement, indigenous peoples’, and biodiversity issues, including the IAP’s level of concern and recommendations; and, (ii) Additional comments of the IAP in the of individual technical annexes, namely: • Annex 1: Resettlement issues • Annex 2: Indigenous Peoples’ issues • Annex 3: Biodiversity issues

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Part 2: Summary of IAP issues, requirements, and recommendations Summary of Resettlement Issues

Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

R4 Site visits: PHXRA • NNP1PC provides good support for Recommendations High 7-14 December 2014 • Households resettled resettlers livelihood restoration • IAP recommends that NNP1PC gives 3-10 May 2015 at PHXRA require • PLUP is completed at PHXRA, but highest priority to repairing all agricultural 6-13 December 2015 support for livelihood lacks effective enforcement infrastructure at PHXRA 11-18 December 2016 restoration • NNP1PC did not repair agricultural • EAP for PHXRA Irrigation Reservoir Dam 4-11 June 2017 • Agricultural infrastructure before 2019 wet should be included in EAP for NNP1 Main 12-19 November 2017 infrastructure requires season Dam and Re-regulation Dam and any saddle 20-27 May 2018 urgent repair • PHXRA irrigation dam lacks EAP dam(s). 9-16 December 2018 • Need for dam safety • District, law enforcement, and • IAP recommends that NNP1PC consider 2-9 June 2019 inspection of irrigation social welfare officials are hiring a senior, professional community reservoir dam and promoting social development organizer – Hmong ethnic – to work with Concession Agreement, prepare an EAP district and law enforcement officials and Annex C, Appendix 3, • Poor social cohesion at local authorities to promote social cohesion Table 1-1, b PHXRA at PHXRA. R5 Site visits: PHXRA • PAP house certificates and land • Confrontation has been reduced between Medium 7-12 January 2013 • Some resettler titles for home plots have been resettlers and previous occupants of 17-24 November 2013 households report handed over grazing land, but some tension continues 4-11 May 2014 confrontation with • PLUP completed and paddy land • Stronger village administration and more 7-14 December 2014 previous land conflicts resolved village cohesion is needed 3-10 May 2015 occupants at PHXRA 6-13 December 2015 • Some resettlers continue to report Recommendations 15-22 May 2016 • Outsiders (self- being threatened by previous • IAP recommends that district and law 11-18 December 2016 resettlers) continue to occupants of grazing land enforcement officials work with village 4-11 June 2017 graze large livestock authorities to respond to resettlers’ 12-19 November 2017 at PHXRA complaints about threats from previous 20-28 May 2018 • Enforcement of PLUP land occupants. 9-16 December 2018 at PHXRA • IAP recommends that NNP1PC work with 2-9 June 2019 provincial and district officials to Concession Agreement, strengthen village leadership at PHXRA Annex C, Appendix 7 and to build village cohesion. *Level of concern • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High - immediate action recommended.

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Summary of Resettlement Issues

Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

R7 Site visits: Zone 2UR • Agricultural land access tracks • The IAP Resettlement Specialist did not High 7-12 January 2013 • Livelihood restoration of remain unfinished visit this area in June 2019 17-24 November 2013 PAP in three villages in • Failed suspension bridge not Recommendations 4-11 May 2014 Zone 2UR requires replaced since April 2018 • IAP recommends NNP1PC should consult 3-10 May 2015 continued support • Hom District authorities have district officials and inform PAP about 6-13 December 2015 • Policy clarification is pre-empted NNP1PC and RMU policies for claiming and developing 15-22 May 2016 needed for use of by granting a fish purchase islands and drawdown zones and other 11-18 December 2016 drawdown zones in concession to one individual at management issues in the NNP1 reservoir 4-11 June 2017 NNP1 reservoir 2LR; creating a monopsony • IAP recommends a Reservoir and 12-19 November 2017 • Management of reservoir market for fishers Fisheries Management Plans should be 20-27 May 2018 fisheries remains unclear • XSB provincial and Thathom formulated in a participatory manner as 9-16 December 2018 and may be problematic district officials unclear about soon as possible, submitted for approval • Agriculture infrastructure reservoir fishing regulations by GOL authorities, and disseminated remains unfinished • NNP1PC is providing a barge • Urgent attention needed to complete for river crossing in the interim agriculture infrastructure; replace the failed as water will reach 320msl soon suspension bridge R8 Site visits: Zone 2LR • Xaysomboun RMU and a special • 4 of 7 holdout households settled at Ban Low 7-12 January 2013 • Some self-resettlers provincial task force for 2LR have Hom Thad, Hom District, Xaysomboun 17-24 November 2013 have no agricultural land effectively resettled all PAP Province but remain without sustainable 4-11 May 2014 and require intensive • 7 hold-out households originally from livelihoods. 7-14 December 2014 Namyouak 2LR were resettled in June follow-up for livelihood 2018; 4 hh in Ban Hom Thad, Hom Recommendation 3-10 May 2015 restoration District, Xaysomboun Province; 2 hh • NNP1PC should work with Hom District 6-13 December 2015 • Many self-resettlers in in Vanghai and 1 hh in Khonesana, officials to assist 4 hold-out self-resettler 15-22 May 2016 Hom District are Thathom District, Xaysomboun families at Ban Hom Thad to be legalized 11-18 December 2016 returning to use former • Some self-resettler households are and to pursue preferred occupations. 4-11 June 2017 lands in NNP1 short of money, having spent • NNP1PC should consider hiring a Hmong 12-19 November 2017 watershed, including compensation on food & housing woman consultant to train Hmong women 20-27 May 2018 grazing livestock • NNP1PC is assisting with and in home economics* aiming to improve monitoring self-resettler livelihood 9-16 December 2018 • Self-resettlers do not management of household funds. 2-9 June 2019 restoration in the Project Area have sustainable • CA obligates NNP1PC to assist all livelihoods PAP, including self-resettlers, to Concession Agreement, restore livelihoods and incomes to Annex C, Appendix 7 meet target net incomes. * Level of Concern: * Home economics includes the following subjects: • Low - action recommended within 6 months Cooking, Child Development, Education and Community Awareness, Home Management and Design, Sewing and • Medium - action recommended within 1-2 months Textiles, Budgeting and Economics, Health and Hygiene • High - immediate action recommended

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Summary of Resettlement Issues

Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

R10 This issue is now covered in R13. Closed R11 Site visits: Provincial and district • NNP1PC reports that regulations Recommendations Low 20-27 May 2018 officials and village have been drafted and submitted • The IAP recommends NNP1PC work with 9-16 December 2018 authorities in the Project to provincial authorities for review staff of Poverty Reduction Fund (PRF), at 2-9 June 2019 Area are not aware of the and agreement MAF, to prepare village development regulations for plans (VDPs) for fairly allocating post- CA, Annex C, administering the COD Community Development funds; to Environmental and Social Community Development support community development activities Obligations, Clause 97 Program funds with ownership by PAP in the Project Area, ensuring alignment to district development plans. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High - immediate action recommended.

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Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

R12 Site visits: Environmental flow (eflow) • ADB reports original eflow assessment • IAP continues to monitor discharge of water from High 12-19 November 2017 • Minimum eflow was prepared by Kansai (2012) and the Re-regulation Dam into the NNP daily 20-27 May 2018 requirements in CA & ESIA updated by ERM as part of ESIA. • IAP notes that the ESIA approved by ADB has a 3 3 3 9-16 December 2018 are different. Minimum eflow is 27.0 m /sec; CA fixed eflow of 27 m /sec, not 5.5 m /sec states eflow is 5.5m3/sec; CA has 2-9 June 20189 • If eflow is to change, an • NNP1PC is required to have an approved EAP OP ESIA Addendum will need requirements for minimum water depth in place 6 months before COD.

ADB approval. and maximum water level fluctuation • The current “fixed” eflow regime results in elevated Concession Agreement, Downstream villages • Nam Ao earthen dam collapsed 11 Sept low flows in dry season, lower peak flows in wet Annex C, Appendix 7, • Periodic low water level in 2017, endangering downstream villages, season, and delay in downstream peak flows of Entitlement Matrix, Item Nam Ngiep river habitats, and NNP1PC assets about one month compared to natural conditions. 5, Item 10 • NNP1PC proposes to • NNP1PC and MONRE are collaborating Recommendations reduce minimum eflow to to improve resources management and • IAP recommends that since NNP eflow in ESIA is Concession Agreement, 5.5 m3/sec. development in Nam Ngiep basin different from CA, NNP1PC should develop a • No assessment of potential • EAP in May 20189 Reservoir technical solution to meet approved eflow level of Annex C, Environmental 3 and Social Obligations, impacts from release of Impounding Plan for Re-regulation Dam 27 m /sec, fluctuation levels, and depth. sediment into the Nam is out-of-date; NNP1PC staff training Environmental • IAP recommends that NNP1PC continue social, Ngiep river was undertaken was not provided; village drills were not economic, and livelihood development activities in Management System before flushing sediment conducted in downstream villages downstream villages in Zones 3 and 5 and Zone from NNP1 re-regulating • Environmental and Social Management 4; to offset past or future impacts. ADB, Social Safeguards dam resulting in loss of and Monitoring Plan for Operational • IAP recommends additional flushing of sediment Policy 2009, SR 1 common resources by Zone Phase, Vol. III, Procedures (Draft) states from NNP1 re-regulating dam be preceded by an requirement 4 & 5 villages following are prepared: IEE to identify potential negative impacts on Zone • No IEE is planned if the - Stand-alone emergency preparedness and 3, 4, and 5 downstream villages. ESMMP-OP Vol III remaining sediment is to be response procedures, ESMMP-OP Vol III • IAP recommends that NNP1PC prepares one EAP released Section 7 for Operations Phase for all NNP1PC dam Section 7 - Emergency Preparedness & Response • An updated EAP is needed Plan structures: Main Dam, Re-regulating Dam and all for Operations Phase at all associated auxiliary dam(s), and Irrigation Dam at EIA, Section 7.2.1.9, p. - Emergency Action Plan for Main Dam, Part NNP1PC dam structures: 2 of 4 PHXRA. 7-30 Main Dam, Re-regulating - Emergency Action Plan, vol. 4 of 4, for Main • IAP recommends water measurement gauges be Dam and auxiliary dam, and Dam, Operational Stage installed in all Zone 4 villages. PHXRA Irrigation Dam • Water measurement gauges not • IAP recommends compensation be paid installed in Zone 4 villages immediately for unanticipated impacts for 10 days • Compensation unpaid for unanticipated in January 2019. impacts for 10 days in January 2019 • IAP recommends NNP1PC investigate Impacts of • Impacts of NNP1PC discharge in NNP1PC October 2018 discharge causing excess October 2018 causing excess flooding flooding to rice fields in downstream villages in Zone 4 downstream villages * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High - immediate action recommended

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Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

R13 Site visits: Zones 3 and 5 • PLUP process is being conducted • Completion of PLUP process at Hat Gniun Medium 12-19 November 2017 • PAP at Hat Gniun are and is nearly completed at Hat and granting of replacement land for land 20-27 May 2018 forbidden from accessing Gniun; final consultations with PAP expropriated at PHXRA are expected to 9-16 December 2018 land around NNP1 Re- are expected during June/July 2019 resolve many outstanding land issues 2-9 June 2019 regulation Dam and and PLUP finalized soon thereafter • NNP1PC has reduced staff resulting in powerhouse; no prior • Detailed analysis of needs of Hat slower processing of PAP grievances Concession Agreement, consultation or Gniun PAP and land use allocation • District officials are aware of HSK self- Part II, Clause 53, item compensation being conducted by Bolikhan resettlers who returned to Hat Gniun g., i, ii; and, items h-p • Outstanding grievances District task force • IAP understands that NNP1PC and RMU from PAP at Ban • HSK self-resettlers who returned to need clear instructions and authority from Concession Agreement, Hatsaykham (HSK) Hat Gniun have constructed houses PRLRC to resolve outstanding Annex C, Appendix 7, (Zone 3) along the main access road to the compensation grievances in Hat Gniun; to Category 4 PAP, pp. • Outstanding grievances Powerhouse. District Governor and use Decree 1003 for compensating 130-131; and, from Hat Gniun (Zone 5) working group planning to act. grievants. NNP1PC will inform grievants Entitlement Matrix, Item • Delayed compensation about PRLRC decision and discuss with 10 payments and resolution each household whose lands were of grievances continue to compensated by Decree 031 in the initial REDP, Annex B, Section cause tension in Zone 5 period of the Project. 6.1, General Description and at PHXRA • Some HSK self- Recommendations resettlers who arrived in • IAP recommends that PLUP process be HSK after the cut-off- completed as soon as possible. date have returned to • IAP recommends that NNP1P work Hat Gniun to reclaim closely with PRLRC to accelerate the land previously used resolution of all land and compensation grievances at Hat Gniun. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High - immediate action recommended.

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Summary of Indigenous Peoples’ Issues

Reference / IAP comments and Level of No. Issue Status Document recommendations concern*

S1 Site visits: • Livelihood Programs • In Zone 2UR PAP have followed NNP1PC Recommendations 7-12 January 2013 • Agricultural products Livelihood Programs for a few years. Many • IAP recommends that NNP1PC Very high Programs are well organized. 17-24 November 2013 and markets continue to support Livelihood 4-11 May 2014 • For the cattle raising (Mr. Maisone’s case) in Ban Programs to improve the quality of 7-14 December 2014 Hatsamkhone: the cattle market is very big, and price of cattle is good. However, investment in life of the PAP. The Programs are the 3-10 May 2015 cattle raising is high and requires large areas of image of the NNP1PC. The 6-13 December 2015 grazing land. The knowledge to raise cattle is Programs and PAP work closely with 15-22 May 2016 crucial, e.g. vaccination. So, few PAP can invest local government; e.g., district 11-18 December 2016 and access this activity. commerce and agriculture offices. 4-11 June 2016 • For local wine producing in Ban Phiengta, it is a This is to gain support from these 12-19 November 2017 good business in the village. The business serves organizations; for instance: 20-26 May 2018 district and provincial markets since the Lao vaccination, patent registration, 9-16 December 2018 people use local wine for ceremonies and for safety food licenses, marketing, and entertainment. The price of local wine is good. 2-9 June 2019 The only problem is the shortage of the jars technical training, etc. (containers) since the jars are imported from • The broken bridge in Zone 2UR must Thailand. However, nowadays the program tries be rebuilt as soon as possible to use the Lao jars instead. because the entire agriculture lands • For rubber trees in Ban Pou: the activity started use of the PAP of Ban Hatsamkhone only 2 weeks ago; rubber trees are young. The are located the other side of the Nam Project supported 200 rubber trees and training Ngiep River. Around 60% of for PAP (Mr. Xiayang). For the Livelihood agriculture lands of PAP of Ban Programs in Ban Wa, Ban Bo, and Ban Nahan, the PAP just started the program a year ago since Phiengta are located the other side of the PAP moved to the villages only 2 years ago. the Nam Ngiep River, as well. So the Fish raising, vegetables growing, grass seeds are bridge in Zone 2UR is very crucial for required. the 2 villages.

* Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Indigenous Peoples’ Issues

Reference / IAP comments and Level of No. Issue Status Document recommendations concern*

S2 Site visits: Hmong graves removal In Zone 2UR, according to NNP1 PC staff (Mr. Recommendations Closed 7-12 January 2013 and compensation Khata), the 11 IP graves had been The IAP appreciates the Project for the IP 17-24 November 2013 compensated from the Project. All IP graves graves solution. 4-11 May 2014 had been completely compensated. 7-14 December 2014 3-10 May 2015 6-13 December 2015 15-22 May 2016 11-18 December 2016 4-11 June 2017 12-19 November 2017 20-26 May 2018 9-16 December 2018 2-9 June 2019 S4 Site visits: Food security is the most • This 13th Site Visit was in the wet rice planting In this point, the IAP had observed and Very high 7-12 January 2013 important issue for IP season (beginning May-June) of IP Hmong. Many understood that the Project staff in Zone 17-24 November 2013 Hmong at all sites. Rice IP Hmong are planting rice and could not meet 2UR, Thathom District, understand the IP with the IAP and NNP1PC: e.g., in Ban Pou, Ban 4-11 May 2014 is the most important Hmong’s life very well. Vanghai, Zone 2UR, Thathom District, 7-14 December 2014 staple food for the IP Xaysomboun Province; and, Ban Wa, Ban Bo, 3-10 May 2015 Hmong. Ban Nahan, Bolikhan District, Bolikhamxay 6-13 December 2015 Province. 15-22 May 2016 • In Ban Pou. IP Hmong farmer, Mr. Xiayang grew 11-18 December 2016 rice, pineapples, and rubber trees together in his 4-11 June 2017 field. The rubber trees and pineapple are still 12-19 November 2017 young, but IP Hmong can benefit from growing 20-26 May 2018 rice in the same field. This is to guarantee that 9-16 December 2018 they will have enough rice to consume in their families for the next year. This shows that rice is 2-9 June 2019 crucial in the IP Hmong’s life. • The IAP observed that some PAP IP Hmong in Ban Wa, Ban Bo, and Ban Na Han could not attend the IAP, ADB, and NNP1 PC meeting since they went planting rice in the fields. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Indigenous Peoples’ Issues

Reference / IAP comments and Level of No. Issue Status Document recommendations concern*

S5 Site visits: Dust in the villages This 13th Site Visit was undertaken in the rainy Low 7-12 January 2013 season and dust was not a problem in the 17-24 November 2013 Project sites. 4-11 May 2014 7-14 December 2014 3-10 May 2015 6-13 December 2015 15-22 May 2016 11-18 December 2016 4-11 June 2017 12-19 November 2017 20-26 May 2018 9-16 December 2018 2-9 June 2019 S6 Site visits: Drug abuse, prostitution, • The IAP visited Lowland Lao and IP Hmong Recommendations 7-12 January 2013 crime, and illegal PAP in Phiengta, Hatsamkhone, Pou, The IAP recommends the following Very high 17-24 November 2013 activities in Zone 3 Vanhai villages, Zone 2UR, Thathom actions: 4-11 May 2014 District, Xaysomboun Province; and, IP (1) Lao Laws should be strictly enforced. 7-14 December 2014 Hmong PAP in Wa, Bo, and Nahan villages, (2) NNP1PC should collaborate and 3-10 May 2015 Bolikhan District, Bolikhamxay Province. cooperate with local authorities, health 6-13 December 2015 PAP reported no drug abuse, prostitution, or care personnel, education personnel, 15-22 May 2016 other crimes at these sites. police, and other related agencies to 11-18 December 2016 • Although drug abuse, prostitution, and other address social problems. 4-11 June 2017 crimes are not important issues in these self- (3) Formal & informal education 12-19 November 2017 resettlers villages (Vanhai, Wa, Bo, Nahan). regarding drug abuse, human trafficking, 20-26 May 2018 However, in Vanghai where land availability and other crimes should be provided and 9-16 December 2018 is limited, PAP IP Hmong could turn to drug PAP supported in income restoration in 2-9 June 2019 use and drug trading in the future. their villages. Therefore, NNP1PC Livelihood Programs are important to improve PAP quality of life. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Indigenous Peoples’ Issues

Reference / IAP comments and Level of No. Issue Status Document recommendations concern*

S7 Site visits: Compensation and unit In Zone 2UR, the 11 IP graves had been 7-12 January 2013 compensation rates compensated. According to NNP1PC staff in Closed 17-24 November 2013 Zone 2UR, compensation payment for IP 4-11 May 2014 graves is completed. 7-14 December 2014 3-10 May 2015 6-13 December 2015 15-22 May 2016 11-18 December 2016 4-11 June 2017 12-19 November 2017 20-26 May 2018 9-16 December 2018 2-9 June 2019 S8 Site visits: Phouhomxay IAP IP Specialist did not have a chance to visit 7-12 January 2013 Resettlement Area this site. 17-24 November 2013 4-11 May 2014 7-14 December 2014 3-10 May 2015 6-13 December 2015 15-22 May 2016 11-18 December 2016 4-11 June 2017 12-19 November 2017 20-26 May 2018 9-16 December 2018 * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Indigenous Peoples’ Issues

Reference / IAP comments and Level of No. Issue Status Document recommendations concern*

S9 Site visits: 7 hold-out households of • IAP IP Specialist did not have a chance to Recommendations Very High 7-12 January 2013 IP Hmong PAP in visit the last 7 households of Namyouak, • The IAP recommends that NNP1PC 17-24 November 2013 Namyouak, Zone 2LR, Zone 2LR. and GOL should treat these 7 PAP 4-11 May 2014 refused to join the Project • IAP IP Specialist was informed that the households like other PAP, especially 7-14 December 2014 actual situations of these 7 households the IP Hmong women who are 3-10 May 2015 are: 2 households live in Vanghai, Zone uneducated and whose children are 6-13 December 2015 2UR, Thathom District, Xaysomboun innocent people. 15-22 May 2016 Province; 5 households live in Homthad, • The next trip (the 14th Site Visit): the 11-18 December 2016 Hom District, Xaysomboun Province. IAP would like to visit these 7 4-11 June 2017 households. 12-19 November 2017 20-26 May 2018 9-16 December 2018 S10 11-18 December 2016 Collaboration with GOL • IAP IP Specialist had a formal meeting with Recommendation Very High 4-11 June 2017 Governor of Bolikhan District, Bolikhamxay The IAP recommends that NNP1PC 12-18 November 2017 Province and informal meetings with the continue to build strong collaborative and 20-26 May 2018 Heads of RMU of both Xaysomboun and working relationship together with officials 9-16 December 2018 Bolikhamxay provinces. IAP observed that in the 2 provinces (Bolikhamxay, and 2-9 June 2019 collaboration between NNP1PC and RMU of Xaysomboun). 2 provinces is sufficient and satisfactory. • The Governor of Bolikhan District (Mr. Bounsone) expressed satisfaction with NNP1PC. He agreed to work closely with the Project to solve all problems under his authority. For instance, he mentioned that he knows the issues in Phouhomxay and is aiming to solve the issues soon. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Social Issues

Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

S13 Site visits: Community IAP IP Specialist observed that the PAP Recommendations Very high 6-14 Dec. 2015 participation participation with NNP1PC activities has The IAP recommends that NNP1PC should 15-22 May 2016 improved. This can be seen from the continue to encourage PAP to participate at all 11-18 December 2016 Livelihood Programs in Phiengta, Pou, levels of activities and aspects with the Project. 4-11 June 2017 12-19 November 2017 Hatsamkhone, Vanghai villages, Zone 20-26 May 2018 2UR, Thathom District, with cattle raising, 9-16 December 2018 local wine producing, rubber tree planting, 2-9 June 2019 market building, and the broken bridge issues; good participation in livelihood programs in Wa, Bo, and Nahan villages in Bolikhan District. S14 11-18 December 2016 Grievance issues Grievance issues are being resolved with Recommendation Very high 4-11 June 2017 good progress. The IAP recommends that grievances continue to 12-19 November 2017 be resolved as normal. 20-26 May 2018 9-16 December 2018 2-9 June 2019 S16 11-18 December 2016 Asset registration Closed 4-11 June 2017 12-19 November 2017 20-26 May 2018 9-16 December 2018 S17 11-18 December 2016 PAP petition The former Director of Namyouak Village Recommendation: High 4-11 June 2017 School, Zone 2LR, Hom District (currently, The IAP recommends that NNP1PC and GOL 12-19 November 2017 he lives in Ban Wa, Bolikhan District) had carefully investigate the issue and find a solution 20-26 May 2018 submitted a letter to the IAP IP Specialist together with community leaders/elders. 9-16 December 2018 saying that he was dismissed from his job 2-9 June 2019 since he disagreed with NNP1PC and the GOL. He said that he was being punished by the GOL. He mentioned that he received injustice from the GOL. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Social Issues

Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

S18 Site visits: Self-resettlement The IAP did not have a chance to visit the 7-12 January 2013 reservoir. 17-24 November 2013 4-11 May 2014 7-14 December 2014 3-10 May 2015 6-13 December 2015 15-22 May 2016 11-18 December 2016 4-11 June 2017 12-18 November 2017 20-26 May 2018 S19 20-26 May 2018 Fishing in the According to IP Hmong in Ban PhouNgou, Recommendations : Very high 9-16 December 2018 reservoir (Zone the district has granted a concession to a The IAP recommends that NNP1PC collaborate 2LR) trader from Vientiane Capital to buy fish with the GOL to investigate this issue and work out caught for commercial purposes from in a more equitable system. the NNP1 Reservoir. The price of fish offered is low compared to the price in the Hom District market. A monopsony market is established that is not fair for the PAP. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Social Issues

Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

S20 Biodiversity Offset The Phong IP in • Phong IP have other alternative names • The IAP IP Specialist spent too much time on High Management Plan Ban Natan and as: Pong, Poong, Phoong, Kha Phong, the road for traveling to Natan Village since the BOMP Tay Phong, Tai Phong, Faen, Lan, the village is very far from the district, as well Hard, Puang, Tay Cham, Pai, Ok, and as the road to the village was bad (in the wet O Dou. season). • Phong are considered indigenous • IAP IP Specialist had only about 1 hour to people in Laos and Vietnam; they are meet and discuss with the Phong IP in the ancient people in these countries. They village. The IAP noticed that the Phong IP have been scattered inhabited the area (both males and females) are very shy and for centuries. humble people, they did not speak much: • In Laos, Phong are classified into 3 sub- e.g.,1 question would be asked with several groups by distinct languages. Linguists Phong IP, but only 1-2 of them might answer classify the Phong into Austro-Asiatic or respond to my question. linguistic family (Mon-Khmer group and Vietic branch). * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Social Issues

Reference / Level of No. Issue Status IAP comments and recommendations Document concern*

S20 Biodiversity Offset The Phong IP in • The Phong are distributed in villages over a Recommendations (continued) Management Plan Ban Natan and vast, remote, and mountainous area, from • The Project should support livelihood activities High the BOMP Houa Phanh Province, northeast Laos, south for Phong IP in Natan Village to improve their

through Xiang Khouang Province, down to quality of life, e.g. water supply, fish and frog southern Bolikhamxay Province. • Total population of Phong in Laos is 26,314 raising, poultry raising, vegetable and persons (13,143 females). (2005) mushroom growing, etc. • Phong in Natan Village, Viengthong District, • The IAP recommends that NNP1PC work with Bolikhamxay Province grouped together as a local officials, village authorities, ethnic village in 1980s. Natan is surrounded by leaders, and villagers to prepare a community forests and mountains. There are 44 development plan in a participatory manner; households with 266 persons (190 Females). aiming to engage women and youth as much

In Natan Village, Phong look like Lao people as possible. and speak Lao fluently. Phong in Natan are animists and Buddhists. They are farmers • Next Site Visit (December 2019): The IAP IP with about 20 ha of paddy in the village. Specialist would like to visit and discuss with Phong in this village wear Lao clothing. Phong IP in other BOMP affected villages: BOMP and Phong IP in Natan Village Vangphiang and Na Gnang, in Viengthong • The majority of Phong IP in Natan District; and, Phonemeuang, Meuang Cham, understand BOMP. They recognize the and Sopkhone in Xaychamphone District. importance of the BOMP. They recognize the importance of wild animals, fish, forest, trees, water, land, and forest products. They recognize the disappearance of some wild animals (deer, wild boar, birds, squirrels, etc.). They want these wild animals to return. Phong IP often hunt and fish. They know medicinal herbs. They requested the Project and GOL to support some livelihood activities in the village, e.g., water supply. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • High/Very high - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B2 Site visits: Activities along the dam Degradation, logging and forest Recommendations High 7-12 Jan 2013 access road and in dam clearance for agriculture along Contract a credible Biodiversity Service 17-24 Nov 2013 construction zone need to access roads. On-going risk for Provider and work with provincial authorities 4-11 May 2014 be managed to reduce life of project. Not specifically re- to: 3-10 May 2015 impacts. assessed in June 2019. • limit approved forest clearance and 6-13 Dec 2015 degradation along new dam access road 14-21 May 2016 • limit further, and reverse existing, 4-11 June 2017 ‘freelance’ agricultural clearance in and 2-9 June 2019 around dam construction zone B4 Site visits: Introduction of potentially • Draft WMP includes suitable Recommendations Medium 7-12 Jan 2013 invasive species as part of provision for tackling non- • Follow the draft WMP’s provisions for 17-24 Nov 2013 construction, revegetation, native fish threat reservoir fishery and potential 4-11 May 2014 agriculture, and fisheries • Various non-native invasive aquaculture management. 3-10 May 2015 schemes. plant species are often • Refer any substantive change in this 20-27 May 2018 spread during construction in part of the WMP back to the IAP for 9-16 Dec 2018 Lao PDR. Now too late to comment. 2-9 June 2019 address this, so not assessed • Continue to use only native species for • Revegetation was stated to revegetation. use only native species

* Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B5 Site visits: Information base for Biodiversity values are not Recommendation Medium 7-12 January 2013 biodiversity in sub- currently monitored; project Contract a credible Biodiversity Service 17-24 November 2013 catchment and NC/NX is provinces have limited capacity Provider and work as part of BOMU to build 3-10 May 2015 weak, and existing capacity and resources; some villagers capacity in local government and communities 11-18 Dec 2016 for monitoring (both general (notably Hmong) have good in biodiversity monitoring and generate 20-27 May 2018 bio-diversity, and specific local knowledge. information to refine NNL programme 2-9 June 2019 no net loss [NNL] targets) is performance. weak. B9 Site visit Government capacity to Bolikhamxay has considerable Recommendation High 4-11 May 2014 implement conservation experience in conservation Contract a credible Biodiversity Service 9-16 Dec 2018 activities in the sub- activities, Xaysomboun very little, Provider and work as part of WRPOs for each 2-9 June 2019 catchment. yet most NNL-related activities in province to build capacity in local government the sub-catchment are in (and communities) in catchment management Xaysomboun. Neither province activities. has an experience in NNL projects. Considerable capacity building and exposure to global best practice is needed. B11 Site visits: • Collaboration with • Developments at NNP2 Recommendations Medium 3 -10 May 2015 NNP2 on watershed impact on watershed, • Continue contact with NNP2 to 11 – 18 Nov 2017 management. including water quality and facilitate collaboration and 9-16 Dec 2018 • Breach of Nam Ao dam aquatic biodiversity. complementarity of watershed 2-9 June 2019 showing need for • Limited recent contact with management. cross-collaboration and NNP2. • Establish regular contact with NNP2 and information sharing. • Not specifically re-assessed in other dams in watershed re June 2019. environmental and safety management. • Need to strengthen collaboration and ensure emergency plans in place.

* Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B15 Site visits: Development and use of • BOMP will appear much later Recommendations Urgent 3-10 May 2015 the Biodiversity Offset than originally planned, due in • Secure full, final, approval of BOMP within 6-13 Dec 2015 Management Plan part to major changes in NNL June 2019, but refer back to IAP if 14-21 May 2016 (BOMP). focus. BOMP now covers the substantive content change is requested 11-18 Dec 2016 offsetting activities only within by any party. 20-27 May 2018 NC/NX; the vital offsetting in the • Contract a credible Biodiversity Service 9-16 Dec 2018 sub-catchment is covered in Provider to work as part of BOMU to 2-9 June 2019 WMP. implement the BOMP. • Full, final approval of the BOMP is expected within June 2019. • Interim AIP for NC/NX approved and in use pending BOMP approval. B22 Site visits: Legal status of NC/NX at • Biodiversity Offset site’ Recommendation Closed 14-21May 2016 time of designation as the currently has no automatic Focus from now on developing a successful 11-18 Dec 2016 biodiversity offset area for leA gal‘ status in Lao PDR. working conservation model; the appropriate 20-27 May 2018 NNP1 was national • For NC/NX the project has longer-term legal protective designation can 9-16 Dec 2018 protection forest. negotiated a provincial be developed during the project. 2-9 June 2019 regulation, which provides site- specific protection adequate for this project.

* Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B31 Site visits: Plan for achieving NNL in • BOMP (for NC/NX) is considered Recommendations Urgent 11-18 Nov 2017 the sub-catchment and under item no. B15. To achieve • Secure full, final, approval of WMP within 20-27 May 2018 NC/NX. NNL, conservation action in the sub- June 2019, but refer back to IAP if 9-16 Dec 2018 catchment is also vital. substantive content change is requested 2-9 June 2019 • Full, final approval of the sub- by any party. catchment’s management plan • Contract a credible Biodiversity Service (‘WMP’) is expected within June 2019. Provider to work as part of the WRPO • Interim AIP for sub-catchment is for each province, to implement the under development but not yet WMP. approved. • Agree AIP for sub-catchment for critical • Some vital activities are already NNL activities in advance of approval of occurring, e.g., patrolling, but others WMP (if necessary). are not. The delay increases the risk of failing to meet NNL. B32 Site visits: Need to recruit • Achieving NNL will be highly Recommendation Urgent 11-18 Nov 2017 experienced Biodiversity challenging and an organisation Recruit and deploy a credible Biodiversity 20-27 May 2018 Service Provider (BSP) as committed to and experience in Service Provider with no further delay. 9-16 Dec 2018 soon as possible. world-class locality-based biodiversity conservation is needed 2-9 June 2019 Repeated delays to this to bring in global best practice while are increasing the risk of working as an integral partner in the failure to meet NNL. management teams (the BOMU and the two WRPOs). • ADB handle the recruitment and contracting. Negotiations are now underway with a highly promising applicant. This applicant is highly suitable based on previous experience globally and in Lao PDR, and approach to this project as presented to the Company, ADB and others on 8 June 2019. • Delayed recruitment * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B33 Site visits: Implementation of • Pre-BOMP activities have Recommendation Medium 11-18 Nov 2017 activities at NC/NX in occurred in 2017 and 2018, and Implement the pre-BOMP activities until the 20-27 May advance of approval are extended into 2019 until BOMP is approved, via the agreed 2019 9-16 Dec 2018 of BOMP, which has BOMP is approved via an AIP workplan. 2-9 June 2019 been delayed • These are very much a second- choice solution imposed by delay in agreeing BOMP, and in engaging BSP. B34 Site visits: GOL is upgrading road Road upgrading has started. This Recommendations Very High 11-18 Nov 2017 from Viengthong eases access for a variety of • Contract Biodiversity Service Provider to 20-27 May 2018 District, Bolikhamxay wildlife and forest law-breakers work as part of BOMU to combat illegal 2-9 June 2019 Province to Vietnam unless adequate law enforcement activities. border. is in place, which it is not. • NNP1PC to engage with BKX and military to build in measures so that upgrading does not enable wildlife hunting & trapping B35 Site visits: Provincial regulation of After delay, now approved Recommendation Medium 11-18 Nov 2017 Bolikhamxay for As with all regulations, assessment of 20-27 May 2018 NC/NX suitability is needed during implementation. 2-9 June 2019 B36 Site visits: Access for forest and • Sub-catchment and reservoir Recommendation Very High 11-18 Nov 2017 wildlife law-breakers via are used by villagers and Contract a credible Biodiversity Service 20-27 May 2018 the reservoir and roads contractors for extractive Provider to work as part of BOMU to combat 9-16 Dec 2018 requires effective purposes including fishing illegal access and activity. 2-9 June 2019 deterrence. (opportunistic and commercial, see B40) and log removal; new logging road within watershed was apparent in 2018. • WMP includes suitable strategy for limiting access but effective implementation will be highly challenging and requires involvement of BSP. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B38 Site visits: The sub-catchment’s • Reportedly no further action on Recommendation Medium 20-27 May 2018 proposed Totally Protected zone boundary finalisation – it Reach agreement on TPZ1 boundary and re- 2-9 June 2019 Zone 1 overlaps with pre- will be part of 2019 AIP. designation of production forest it contains to designated production • Progress with re-designation of protected status for better protection. In the forest. production forest was not interim, ensure no extractive forestry occurs investigated on this visit. within the TPZ. B39 Site visits: Proposed Nam Theun 4 • Theun-Hinboun Power Recommendations Very High 20-27 May 2018 dam inundates part of Company undertaking feasibility • Work with Theun-Hinboun to 2-9 June 2019 NC/NX offset site study. minimise impact on NC/NX and, if Proposals for four other • Dam feasibility studies on hold needed, select appropriate new offset dams in offset site. after Xenamnoy saddle dam area for risks to NNP1’s ability to failure. meet NNL. • Ensure that NNP1 is not held liable for any cost increase to meet NNL as a result of subsequent hydropower project approval affecting NC/NX (or the sub-catchment). B40 Site Visits: Unregulated fisheries Reportedly no further action on Recommendation High 9-16 Dec 2018 activities in reservoir. ensuring only appropriate fisheries • Secure full, final, approval of WMP 2-9 June 2019 activity in the reservoir – it will be within June 2019, but refer back to part of 2019 AIP. IAP if substantive content change is requested by any party. • Contract a credible Biodiversity Service Provider to work as part of WRPOs to combat illegal fish- related activity.

* Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B41 Site Visits: Clear roles and authority • BOMP and WMP lay out roles. The Recommendation Urgent 9-16 Dec 2018 are needed for BSP role is essential and needs full Delayed authority for the BSP to fulfil its role 2-9 June 2019 implementing in the sub- authority and backing of NNP1PC. is a major risk for achieving NNL and the catchment and NC/NX to • Responsibility and route for Company and GoL should give urgent achieve NNL. securing authority for BSP to attention to ensuring there will be no delay. operate in 2 provinces seems not to have been agreed. • No credible BSP will come to the project with these authorities, nor could it procure them independently without considerable delay and risk to NNL. Moreover, it is not a BSP’s responsibility to secure this authority, because a service provider is not operating independently, but provide specific services to the project. B42 Site Visit Indigenous people in A Community Development Plan Recommendation Medium 9-16 Dec 2018 NC/NX: ADB safeguard (format and scope of an Indigenous Keep to timeline. Ensure full participation of 2-9 June 2019 triggered. Peoples Plan, outline as annexed to BSP and other NC/NX stakeholders in the BOMP) for Phong and Hmong preparation process to ensure no conflict villages finalised by October 2019. with over NNL programme B43 Site Visit Oversight on Biodiversity • Originally envisaged that IAP visits Recommendation Very high 9-16 Dec 2018 issues. conclude in Dec 2018, but IAP was Contract a credible Biodiversity Service 2-9 June 2019 extended to mid-2021. Provider and then have only the IAP and the • Biodiversity Advisory Committee independent NNL auditors as built into the (BAC) is disbanded. The role was BIMOF. important in year before BSP contracted but provided a credible BSP is contracted the resources that would be spent on BAC can be put to better use. • The BIMOF requires periodic independent auditing for progress towards NNL * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Summary of Biodiversity Issues No. Issue Status IAP comments and recommendations Level of Reference / concern* Document

B44 Site Visit Funds flow for NNL • To the Company’s and ADB’s Recommendations Urgent 2-9 June 2019 contributions additional to credit, considerable additional • Route non-CA funds for the sub- those mandated in the funding has been committed by catchment as specified in the Concession Agreement. both organisations once it was BIMOF; that is, to be managed realised that the sums in the CA directly by the Company. were insufficient for NNL. • Ensure this is communicated to all NNP1’s Biodiversity Impact parties promptly. Mitigation and Offset Framework (BIMOF) states that “NNP1PC will adopt a similar arrangement to the Theun- Hinboun Power Company for biodiversity management, where NNP1PC will manage all funds over and above the Concession Agreement (CA) commitment with the GOL. This would help to ensure optimum use and accountability of funds”. • During the site visit some uncertainty was expressed by some parties as to financial routing. Confusion on this matter, once the BOMP and WMP are approved and BSP is contracted, may seriously prejudice achievement of NNL. * Level of Concern: • Low - action recommended within 6 months • Medium - action recommended within 1-2 months • Urgent/Very High/High - immediate action recommended

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Background Annex 1: Resettlement Issues 1. The reservoir of the Nam Ngiep 1 hydropower project (NNP1) has inundated the houses and agricultural lands of five villages and impacted an additional three villages and one hamlet as follows: • Four villages in the Lower Section of the Reservoir (LR) in Xaysomboun Province (Zone 2LR); • Three villages in the Upper Section of the Reservoir (UR) in Xaysomboun Province (Zone 2UR); and, • One hamlet in the Construction Area in Bolikhamxay Province (Zone 3).

2. From villages in Zone 2LR, 479 households were resettled and from Zone 3 (Hatsaykham) 38 households; plus, eight split households from both zones. Seven hold-out households from Zone 2LR have self-resettled in Anouvong, Hom, and Thathom districts in Xaysomboun Province.

3. The GOL and CA designated resettlement site is an area of approximately 2,393 ha called Ban Phouhomxay (formerly Houay Soup) Resettlement Area (PHXRA) (Zone 5), designated in the Concession Agreement; along with some 3,715 ha in an adjacent protection forest area that will be managed through an integrated Watershed Management Plan. The PHXRA is located on the right bank of the Nam Ngiep river and previously was under the administrative jurisdiction of Ban Hat Gniun host village, Bolikhan District, Bolikhamxay Province. Ban Phouhomxay currently is established as a village independent from Ban Hat Gniun, with all usual local administrative units.

4. Resettlement has been the responsibility of NNP1PC’s Environment and Social Division (ESD), specifically the Social Management Office (SMO). The ESD director has interacted well with the Provincial Resettlement Management and Living Condition Restoration Committee (PRLRC) (i.e., Resettlement Committee), as well as provincial level resettlement management units (RMUs) and District Coordinating Committees (DCCs) throughout the resettlement process. ESD and SMO personnel have collaborated with GOL officials in Xaysomboun and Bolikhamxay provinces to organize and facilitate resettlement and self-resettlement consistent with ADB safeguards and other international standards.

5. NNP1PC reports that resettlement from 2LR and relocation of eight households in 2UR have been completed. From 2LR: 51 + 7 split PAP households, 58 total; and, from Hatsaykham, Zone 3: 20 + 4 split households, 24 total; 82 households in total have been resettled at PHXRA. NNP1PC reports that all resettlement infrastructure has been completed at PHXRA and in Zone 2UR; except for completion of agriculture land access roads and a damaged suspension bridge in 2UR.

6. NNP1PC reports that all grievances from zones 2LR, 2UR, 3, 4, and 5, have been resolved through the project grievance mechanism. However, PAP in Ban Hat Gniun remain dissatisfied with decisions of the grievance committees. Social development and livelihood restoration programs are operating well in all zones. In addition, NNP1PC SMO has initiated a livelihood restoration program and socio-economic monitoring for self-resettlers.

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Supplementary Comments on Selected Resettlement Issues1

Supplementary comments related to Zone 2LR, Xaysomboun Province

7. Issue: The IAP continues to be concerned that Nam Ngiep 1 Reservoir fisheries will not be managed to maximize benefits for self-resettlers and host villagers. The Hom District Governor clarified for the IAP that fish trading and restaurant/convenience store concessions established structures at the fish landing in Zone 2LR were temporary. Once NNP1 fisheries management regulations were approved the concessions would be cancelled. Fisheries management is related to the bigger issue of management of the Nam Ngiep 1 Reservoir; specifically claiming and developing islands and drawdown zones. (Issue R7)

Recommendations • NNP1PC should consult with district officials and inform PAP about official policies for claiming and developing islands and drawdown zones and other management issues in the NNP1 reservoir. • A Reservoir Management and Fisheries Management Plan should be completed in a participatory manner as soon as possible and submitted for approval by GOL authorities and disseminated to PAP.

Supplementary comments related to Phouhomxay Resettlement Area, Bolikhan District, Bolikhamxay Province

8. Issue: Although PLUP has been completed at PHXRA, resettlers report that use of gazing land at PHXRA continues to be challenged by (i) previous land occupants from Hatsaykham who also have been resettled at PHXRA; and, (ii) Hatsaykham self-resettlers who continue to graze their cattle at PHXRA. The IAP reiterates that resettlers at PHXRA need to feel confident about being able to practice their livelihood peacefully, without feeling threatened, and with hope for better lives for their children. In addition, as noted previously, infrastructure failures at PHXRA require NNP1PC’s urgent attention, specifically: flooding and erosion of agricultural land access tracks and the poor quality of some irrigation infrastructure. The IAP understands that the rehabilitation of agricultural infrastructure is underway. However, because of the uncertain quality of agriculture infrastructure, the IAP questions the quality and safety of the irrigation dam at PHXRA. The dam should be inspected for dam safety and an Emergency Action Plan prepared for areas below the irrigation dam. In addition, provincial, district, and law enforcement officials should be concerned about the quality of village leadership at PHXRA and the use and trading of illegal drugs. Significantly strengthened village leadership and more social cohesion is required to enhance long-term village development at PHXRA. (Issues R4 and R5)

Recommendations • IAP recommends that NNP1PC gives highest priority to repairing all agricultural infrastructure at PHXRA. Further delays are negligence and may lead to non-compliance by NNP1PC. • IAP recommends that an EAP for the PHXRA Irrigation Reservoir Dam should be included in the EAP for NNP1 Main Dam and Re-regulation Dam and all saddle dam(s).

1 The letters and numbers in parenthesis after each issue (e.g., R1) refer to the item number on the issues, requirements, and recommendations matrix in Part 2.

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• IAP recommends that NNP1PC consider hiring a senior, ethnic Hmong, professional community organizer to work with district and law enforcement officials and local authorities to promote social cohesion at PHXRA. • IAP recommends that district and law enforcement officials work with village authorities to respond to resettlers’ complaints about being threatened by previous land occupants. • IAP recommends that NNP1PC work with provincial and district officials to strengthen village leadership at PHXRA and to build village cohesion.

Supplementary comments on impacts on host villages (Zones 3 and 5)

9. Issues: The IAP understands that the PLUP process is underway at Ban Hat Gniun. Land allocation, land titling, land accessibility, and other land related issues are being resolved consultations between district officials and PAP. Outstanding issues include the following: i) PAP claim they have not been paid additional compensation for land expropriated for construction of the dam, based on the unit compensation rate decreed by the Xaysomboun Provincial Resettlement Management and Living Condition Restoration Committee (PRMLCRC or PRLRC). This issue is being resolved through the Grievance Redress Mechanism (GRM). ii) Some PAP claim recently to have lost access to their agriculture land adjacent to the re-regulation dam and adjacent powerhouse; wherein the GOL will establish a safety buffer zone around both structures. PAP claim not to have been consulted or compensated for expropriated land. The IAP understands that the RMU and district officials are resolving this issue through the PLUP process . (Issue R13)

Recommendations • IAP recommends that PLUP process at Hat Gniun be completed as soon as possible.

Resettlement and Social Photos

Left: IAP consulting with district officials, village authorities, and PAP at Ban Hat IAP and ADB consulting with Phouhomxay Gniun, Zone 5, where the participatory land use planning (PLUP) process is being village authorities and resettlers, and NNP1PC finalized. Right: Preliminary Ban Hat Gniun PLUP map prepared for 2nd consultation field staff at Phouhomxay Resettlement Area. with host village PAP.

IAP and ADB consulting with village authorities and PAP in two impacted IAP visited livelihood restoration activities in downstream villages; left: Ban Nam Ngiep, Paksan District Bolikhamxay Province; Zone 2UR; cattle rearing and improved forage right: Ban Nampa, Bolikhan District, Bolikhamxay Province. production activities in Ban Hatsamkhone, Thathom District, Xaysomboun Province.

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Resettlement and Social Photos

IAP Indigenous Peoples Specialist and ADB representatives consulting IAP Indigenous Peoples Spcialist consulting with Phong ethnic group Hmong PAP self-resettlers in Ban Wa, Bolikhan District, Bolikhamxay in the Biodiversity Offset Area of Viengthong District, Bolikhamxay Province. PAP expressed happiness in their new village by singing a Province. welcome song to the ADB and IAP representatives.

AnnexSummary of 2: Indigenous Indigenous Peoples Specialist’s People’s Inputs Issues 1. Introduction

1. This is a progress report based on the 13th Site Visit of the IAP to the Nam Ngiep 1 Power Company’s (NNP1PC) hydropower development project. The site visit took place during 2-9 June 2019. As the IAP expert on Indigenous People (IP), I visited project affected people (PAP) following the schedule below.

2. In Viengthong District, Bolikhamxay Province: Regarding the BOMP (Biodiversity Offset Management Plan), the IAP IP visited the Phong ethnic group in Natan village and had an informal meeting with about 20 Phong in the village hall.

3. In Zone 2UR: The IAP IP visited livelihood restoration activities in Ban Pou (rubber trees planting), Ban Hatsamkhone (cattle rearing), Ban Phiengta (local wine producing), observed the broken bridge in Ban Hatsamkhone, and had an informal meeting with the village headmen of Ban Hatsamkhone and Ban Phieng regarding the market building and bus station. The IAP IP had a formal meeting with about 20 PAP self–resettlers (both men and women) and village authorities in Ban Vanghai (Pakyong Cluster), Thathom District, Xaysomboun Province.

4. In Bolikhan District, Bolikhamxay Province, the IAP IP had a formal meeting with about 40 PAP IP Hmong self-resettlers (both men and women) in Ban Wa, and had a formal meeting with about 15 PAP IP Hmong self-resettlers (both men and women) in Ban Bo; as well as having a formal meeting with about 30 PAP IP Hmong self-resettlers (both men and women) and the village headman of Ban Nahan

5. In Bolikhan District, Bolikhamxay Province, the IAP had a formal meeting with District Governor (Mr. Bounsone) at the Bolikhan District Office.

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6. During the 13th IAP site visit, approximately 120 PAPs were met by the IAP IP in both formal and informal meetings. All relevant issues were discussed, and ideas exchanged to find the best solutions to social issues, together with other participants, namely: GOL officials, ADB specialists, NNP1PC staff, village committees, village authorities, and PAPs.

2. Meetings

7. The IAP IP had nine meetings with higher levels of the GOL and villages authorities, as follows: • 4 June 2019: A formal meeting with Ban Natan authorities and villagers, Viengthong District, Bolikhamxay Province. • 5 June 2019: An informal meeting with the local wine production group of Ban Phiengta, Zone 2UR, Thathom District, Xaysomboun Province. • 5 June 2019: A formal meeting with village headmen and village authorities of Ban Phiengta and Ban Hatsamkhone, Zone 2UR, Thathom District, Xaysomboun Province. • 5 June 2019: A formal meeting with local authorities and PAP IP Hmong self-resettlers of Ban Vanghai (Pakyong Cluster), Zone 2UR, Thathom District , Xaysomboun Province. • 6 June 2019: A formal meeting with the village headman and the PAP IP Hmong self- resettlers of Ban Wa in the village hall, Bolikhan District, Bolikhamxay Province. • 6 June 2019: A formal meeting with the village headman and the PAP IP Hmong self- resettlers of Ban Bo in the village hall, Bolikhan District, Bolikhamxay Province. • 6 June 2019: A formal meeting with the village headman and the PAP IP Hmong self- resttlers of Ban Nahan, Bolikhan District, Bolikhamxay Province. • 7 June 2019: A formal meeting with Bolikhan District Governor (Mr. Bounsone) in Bolikhan District Office, Bolikhamxay Province. • 7 June 2019: a formal wrap up meeting with ADB and NNP1PC staff at the NNP1PC meeting room, Paksan District, Bolikhamxay Province.

3. Schedules

8. During this 13th Site Visit the IAP had both formal and informal meetings with PAP, GOL officials, and NNP1PC staff to discuss, exchange views, interview, and observe many cultural and social aspects of NNP1PC’s livelihood restoration activities. The IAP IP Specialist’s schedule was as follows: • 1 June 2019 - Arrival Vientiane Capital, Lao PDR; reviewed related NNP1PC documents. • 2 June 2019 - Reviewed related NNP1PC documents and had an opening meeting with IAP members to discuss plans for the site visit at the Hotel Khamvongsa, Vientiane Capital. • 3 June 2019 - NNP1PC briefing for the IAP, ADB, and LTA by the Managing Director and staff at NNP1PC Head Office in Vientiane Capital. • 4 June 2019 - Visited and observed Ban Natan, Viengthong District, Bolikhamxay Province; had meetings with village authorities and villagers in the village hall regarding BOMP. • 5 June 2019 - A formal meeting with NNP1PC staff at Zone 2UR at the NNP1PC Office in Thathom District, Xaysomboun Province. - Visited local wine production group in Ban Phiengta, Zone 2UR, Thathom District, Xaysomboun Province. - Informal meetings with Ban Phiengta and Ban Hatsamkhone headmen regarding the community market and bus station, Zone 2UR, Thathom District, Xaysomboun Province.

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- Visited and observed cattle rearing by Mr. Maisone, Ban Hatsamkhone, Zone 2UR. - Visited rubber plantation in Ban Pou, Zone 2UR, Thathom District. - Visited and observed the broken bridge in Ban Hatsamkhone, Zone 2UR. - A formal meeting with village authorities and PAP IP Hmong self-resettlers at Ban Vanghai (Ban Pakyong Cluster), at Mr. Blong Hang’s house, Thathom District, Xaysomboun Province.

• 6 June 2019 - A formal meeting with the village headman and about 40 PAP IP Hmong self- resettlers of Ban Wa, Bolikhan District, Bolikhamxay Province. - A formal meeting with village authorities and about 15 PAP IP Hmong self- resettlers of Ban Bo, Bolikhan District, Bolikhamxay Province. - A formal meeting with the village headman and about 30 PAP IP Hmong self- resettlers of Ban Nahan, Bolikhan District.

• 7 June 2019 - A formal meeting with Bolikhan District Governor (Mr. Bounsone) in Bolikhan District Office, Bolikhamxay Province. - Meeting with NNP1PC staff, at NNP1PC Office, in Paksan District, Bolikhamxay Province.

• 8 June 2019 - Debriefing for the NNP1PC Managing Director and his staff to present IAP findings for discussion at NNP1PC Head Office, Vientiane Capital. - Report preparation and IAP meeting at Hotel Khamvongsa, Vientiane.

• 9 June 2019 - Returning to Bangkok and Chiangmai Province, Thailand

4. Summary of IP and social issues:

9. The main PAP IP (Hmong) issues include the following: • Compensation, spending money properly, petitions, and grievances • Resettlement and self-resettlement • Land use, land disputes, and infrastructure issues in Zone 2UR, Thathom District Xaysomboun Province and in Bolikhan District, Bolikhamxay Province. • 7 hold-out households of Ban Namyouak, Zone 2LR: 4 households in Ban Hom Thad – 2 came from Vanghai, Thathom District, and 2 from Phonepha, Anouvong District, Xaysomboun Province; 2 households remain in Ban Vanghai and 1 household in Ban Khonesana, Thathom District, Xaysomboun Province. • Progress of livelihood restoration activities. • Community participation. • Cooperation and collaboration between NNP1PC and GOL. • Biodiversity offset impacts to Phong and Hmong ethnic groups

5. Requirements and recommendations

10. The IAP IP Specialist has provided requirements and recommendations in the matrix presented in Part 2 that should be taken into consideration by NNP1PC, GOL, and ADB.

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6. The next IAP Site Visit

11. The next IAP site visit is scheduled during 8-15 December 2019. The IAP IP Specialist shall focus on the following: livelihood restoration activities among the IP Hmong; issues related to the Phong IP regarding the BOMP; land disputes in PHXRA; adjustment of the PAP IP Hmong in their new locations; drug abuse; collaboration between NNP1PC and the GOL; and, compensation and grievance issues. During the site visit, I would like to request for meetings and visiting, as follows: • Meet the Governor of Xaysomboun Province, Head of RMU of Xaysomboun Province, Governor of Hom District, and Governor of Thathom District. • Meet the Governor of Bolikhamxay Province, Head of RMU of Bolikhamxay Province, and Governor of Bolikhan District. • Meet the Phong IP in Natan Village, Viengthong District and other 3-4 Phong IP villages nearby (Vangphiang Village and Na Gnang Village, in Viengthong District; and Phonemeuang Village, Meuang Cham Village, and Sopkhone Village in Xaychamphone District). • Meet PAP in PHXRA to discuss land disputes, land use, livelihood restoration, agricultural infrastructure, and grievances. • Meet PAP in Zone 2UR, especially regarding livelihood restoration activities, land use, and grievances; at Ban Pou, Ban Hatsamkhone, Ban Piengta, Ban Vanghai and Ban Thaviengxay, Thathom District, Xaysomboun Province. • Meet the 7 former hold-out households originally from Ban Namyouak, Hom District, who previously refused NNP1PC support, and have now been resettled.

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AnnexSupplementary 3: CommentsBiodiversity on Selected IssuesBiodiversity Issues Report on Nam Ngiep 1’s biodiversity issues as of mid-June 2019

1. The tabulated Summary of Biodiversity Issues in the main report gives a summary overview of 20 points that have previously been raised by the IAP’s reports in relation to biodiversity and have not yet been closed off (signified by B2 – B44, the missing B numbers indicating points that have been closed). Many of these 20 points are in fact best understood as symptoms of the delay in three vital foundations for NNL: i) Securing the service of a reputable Biodiversity Services Provider (BSP) and in receiving full, final all-stakeholder approval for various key documents giving the remit and legitimacy for the No Net Loss (NNL) programme, notably ii) The Nam Chouan – Nam Xang (NC/NX) management plan (the ‘BOMP’, although in fact much of the NNL programme’s offsetting occurs in the sub-catchment) and iii) The sub-catchment’s own (watershed) management plan (the ‘WMP’, which as well as activities to meet NNL contains much material related to other aspects of the Company’s obligations).

2. Until these three foundations are in place, the NNL programme is operates in an atmosphere of provisionality: so, of course, it will be underperforming hugely. Indeed, if the lack of these three foundations did not cause major problems of implementation, the financial cost and effort being expended to secure the BSP and the two management plans would be a waste. Many of the 20 identified problems – to which many more could be added – are common themes in protected area management: combating illegal access, preventing illegal offtake, meeting the legitimate livelihood needs of the area’s pre- protected area (PA) residents and users, particularly those who are socially and/or economically marginalised, stalling illegal habitat clearance, and others, are genuinely difficult. For each PA, each takes years of clear thinking and sustained endeavour to solve. So, the large number of unresolved issues is not of itself an indicator of likely failure for NNP1PC to meet NNL: when the main foundations (BSP and agreed management plans) are in place, then it will be more productive to examine in detail which aspects are underperforming and why, so that early and effective solutions can be made. Every PA- based management programme of this magnitude face some challenges during inception and it is certain that the NNP1 NNL programme will. So, the presence of challenges is not of itself a bad sign – what is needed and what the IAP will examine in particular is the programme’s ability to identify the challenges and then develop and implement effective solutions.

3. By contrast, the lengthy delays in finalising the two areas’ management plans and in particular bringing on board the suitably experienced BSP are of major concern. The NNL ‘clock’ stated ticking several years ago, and in the interim the conservation status of the two areas’ biodiversity can safely be predicted to have declined. So, at the start of full implementation, which can now reasonably be expected to be well within 2019, the starting position is well below ‘level’. Each year’s delay has given an even greater biodiversity cost that the NNL programme needs to make up before it can get back on the track of the NNL calculations (ensuring that project-induced biodiversity benefits equal or outweigh project- induced biodiversity costs) in NNP1’s Biodiversity Impact Mitigation and Offset Framework (BIMOF). Thus, this delay in beginning full implementation is materially prejudicing the chance of reaching NNL.

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4. So, the B numbers (in the biodiversity matrix above) of most concern at this stage are not the symptomatic issues – it’s difficult to patrol, there is NNL – threatening fishing activity in the reservoir, etc. – because these can only plausibly be sorted out when the foundations are in place. The B numbers needing most attention are those that might delay the getting those foundations secured and the start of full implementation: B15, B31, B32, B41 and B44. Therefore, only these latter have been afforded the ‘Urgent’ ranking. Several of the Urgent foundations seem close to closure – B15, B31, and hopefully B32, but two are perhaps still wide open. First, B41, on the government permission for the BSP to operate as part of the NNL programme in the two provinces. If after securing the BSP’s service to the NNL programme there is then a lengthy delay in securing operating permissions for the BSP, this would severely jeopardise the likelihood of reaching NNL on the current budget. As presented during the visit, there is substantial uncertainty in NNP1PC as to how these operating permissions will be secured. This uncertainty may become a major project risk: it requires immediate high-level attention to its solution. Second, B44, on routing of NNL funds additional to those committed in the Concession Agreement. Uncertainty was expressed by some NNP1PC staff on the best approach. In fact, this issue was decided for the BIMOF, so the current uncertainty may simply reflect staff turnover in the interim: the BIMOF solution (direct management of such funds by the Company) remains the most appropriate and should not be reopened unless there is a specific, persuasive reason to do so. No such reason was heard during the IAP’s visit. Related to this, the Company is contracting a Financial Management expert who used to work with GoL on the WB/ADB funded projects to help review the GoL entity capacity, existing procedure and suggestions for improvements.

5. Resolving the foundational B numbers is vital but will not of itself secure NNL. Of equal importance at this stage is attention to the assumptions the BIMOF made about the project’s operational context (Table 1). All these assumptions need to be valid for NNL to be achieved on the current budget, and in addition excellent internal programme management and implementation is needed. If even one of these assumptions is flawed, NNL will not be met without major additional resourcing, and for some, no amount of additional funding could plausibly compensate.

6. Of the seven BIMOF assumptions, one (Assumption a: unprecedented implementation success) is for a result that will occur if all the other assumptions are met and the NNL programme is executed competently. It is a bold assumption. Another (Assumption f: high Government support) is vital for various other assumptions to be met, particularly Assumption b (influential actors respect the legal framework) and Assumption c (no new development that will prejudice NNL). Assumption d (BSP – also a B number) appears to be holding, although way behind schedule, subject to the concerns expressed in B41. Assumption e (flexible budget) is being pushed to its limits by the long delay of full implementation: the NNL programme’s budget has always been tight and the time slippage to full implementation requires more to be done with this budget than had this delay not occurred. It is quite likely that budgetary readjustment will be needed to meet NNL, and it is possible that additional funding will be needed in the first 10 years over that already budgeted. Assumption g (security issues) refers to a dynamic situation; if security does prevent implementation activities in areas identified as important to NNL, it is possible that spatial adjustment, almost certainly with increased budget (reflecting the suboptimal spatial choice and thus harder work to get to the same point), could produce an alternative path to NNL. One key assumption, here called Assumption h, was overlooked during BIMOF preparation: local community attitude. This is because area-based conservation in an area where people live requires their support and, often, involvement, or it will not work. Even more than an ‘average’ area-based conservation project, this assumption is important because NNP1 is involved in so much community work in and around the sub- catchment. Local perceptions of this will influence local reception of NNL-specific activity.

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Table 1: Assumptions required to hold for the Nam Ngiep 1 project to meet No Net Loss Assumption Content BIMOF a The level of wildlife protection required to achieve No Net Loss/Net Gain of biodiversity will exceed, by a substantial margin, anything previously reached in Lao PDR BIMOF b Influential people, institutions and other actors in the sub-catchment will respect the legal framework for biodiversity management in the sub-catchment BIMOF c No new development that potentially could jeopardize the achievement of no net loss of biodiversity will be allowed in the sub-catchment BIMOF d NNP1PC and an independent organisation dedicated to conservation will maintain a significant role as the implementation partner with the GOL BIMOF e In the event the budgets for implementation become a limiting factor to achieving success for the identified targets, NNL/Net Gain budgets will be altered to ensure that adequate funds are made available to make every reasonable attempt at achieving NNL/Net Gain as defined herein BIMOF f A fully supportive implementation environment will be provided and maintained by GOL such that all relevant national and provincial bodies recognise NNP1’s attainment of No Net Loss/Net Gain to be a national priority BIMOF g Security issues will not prevent effective patrolling of any significant area of the currently-defined TPZs New h The community livelihood work of NNP1 in and around the sub-catchment is viewed positively by the local people, and any non-NNP1 community work in and around NC/NX is supportive of, or at least neutral to, NNP1’s programme Note: Assumptions a–g are taken from Nam Ngiep 1’s Biodiversity Impact Mitigation and Offset Framework, dated 23 April 2018 (Document number NNP1-C-J1206-RP-002-A). Assumption h is newly added here. And, although not specified in the BIMOF, assumptions b and c apply to NC/NX as well as the sub-catchment.

7. Most of the assumptions are difficult to assess at this early stage, but the first year of full implementation will be a particularly informative time to assess them. All eight assumptions should be at the forefront of the Company’s mind and, when it is contracted, the BSP’s. Any signs that any one of these assumptions may not be valid require early, priority attention. Across the world, many biodiversity conservation projects that are well designed internally and competently executed underperform in terms of biodiversity conservation outcomes because they have paid inadequate attention to the realities of the context in which they are implemented. For ‘normal’ projects it is possible to say, ‘they did a good job under the circumstances’. But for a NNL programme, with a quantified division between ‘success’ and ‘failure’, a failure to have assessed the implementation circumstances realistically is likely to mean project (NNL) failure. Making NNP1PC’s NNL programmes main assumptions explicit is an important way to reduce the chance of failure.

8. The next IAP visit is intended to be on 8-15 December 2019. The IAP’s Biodiversity NNL specialist expects the issues around final, full approval of the two area’s management plans and the deployment of the BSP to have been resolved, and full implementation to be underway. Nonetheless, it will still be early to assess informatively the level of progress in implementation at the outcome level. Therefore, the Biodiversity NNL Specialist will devote most effort into understanding the perspectives and concerns of the key personnel shaping the project – in government, in the Company and in the BSP – particularly in terms of the eight assumptions. NNP1PC’s NNL programme is complex and demanding and it is essential that all those whose thinking influences what the project does agree on key issues.

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9. In sum, the priority recommendations for the NNP1 NNL programme as of mid-June 2019 are:

• Contract and deploy a credible Biodiversity Service Provider (the current candidate is highly suitable). • Secure full, final, all-stakeholder acceptance of the two NNL area’s management plans (the BOMP and WMP). • Secure full, final, all-stakeholder acceptance of the 2019 Annual Implementation Plan for the sub-catchment (NC/NX’s is already accepted). • Secure implementation permissions for the BSP to allow immediate take-up of role. • Reconfirm the BIMOF’s statement that NNL funds additional to those in the CA will be managed directly by the Company.