THE HABIBIE CENTER DISCUSSION REPORT - THC...

THE HABIBIE CENTER

DISCUSSION REPORT

Institutional Visit and Talking ASEAN

Cambodian Institute for Cooperation and Peace, CambodiaMarch 11, 2016

Water Resource Security in the Mekong Region

INSTITUTIONAL VISIT

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CAMBODIA – On Thursday, 10 March 2016, The Habibie Center held an institutional meeting with HRH Prince Somdech Norodom Sirivudh (Founder and Chairman, Board of Directors, Cambodian Institute for Cooperation and Peace/CICP), H.E. Ambassador Pou Sothirak (Executive Director of CICP), Professor Pou Sovachana (Deputy Director of CICP), and Ms. Neth Chantha (Deputy Director of CICP) to discuss several issues related to the role of CICP in supporting the regional community building process of ASEAN and current political and economic developments in Cambodia.

Amb. Sothirak explained that in order to support regional integration, CICP held numerous events and often host regional conference. He cited as examples a regional conference on Cambodia and China on the South China Sea. CICP also provides policy recommendations to the Cambodian government. In addition, CICP facilitates debates on the latest issues that are important for ASEAN and Cambodia. However, Amb. Sothirak understood that there was a gap between think-tanks and the government.

With regards to challenges for the regional integration process in ASEAN, HRH Prince Sirivudh explained the characteristic of ASEAN. ASEAN was known only at the elite or top level. There was a need to bring ASEAN from the top level to the bottom level. People at the grass roots often do not know about ASEAN. In other words ASEAN was still a concept and seen as elitist for most people. ASEAN 2025 should not be a ‘business as usual’ affair otherwise the notion of a people-centered ASEAN would mean nothing.

More specifically on the ASEAN Economic Community (AEC), Amb. Sothirak said that the AEC Blueprint was not friendly enough for businessman hence they prefered to go by themselves. Moreover, the AEC only promoted free flow of skilled labor hence the low skilled labor was not included. In this regard, since most labor in Cambodia was low skilled, Cambodia could not participate as much in the AEC. Furthermore, it was hard for ASEAN to move forward as there was no enforcement for its member, only peer presure, when it came to the implementation of regional decision. In contrast, the European Union has supranational bodies and enforcement mechanisms.

Regarding the Cambodian economy, Professor Pou Sovachana explained that although Cambodia managed to record high economic growth, it still faced many problems such as inequality given that development was not equally distributed. Unemployment is also one of the crucial problems facing Cambodia. It was hard for laborers in Cambodian to find jobs lately. Therefore, there were many illegal workers from Cambodia who work in Thailand. Cambodia needs FDI to contribute to job creations. However, as FDI shifts to Viet Nam, many factories have since moved to Viet Nam.

With regard to the small and medium enterprises (SME), the Cambodian government did not really promote SME. This was a big challenge as there was a lack of promotional incentives. HRH Prince Sirivudh added that one of the problems facing SMEs in Cambodia was microfinance. There was no microfinance policy from ASEAN.

Phnom Penh, CambodiaMarch 11, 2016

Water Resource Security in the Mekong Region

Talking ASEAN

INTRODUCTION

PHNOM PENH – On Friday, 11 March 2016, The Habibie Center and The Cambodian Institute for Cooperation and Peace (CICP) held a Talking ASEAN public dialogue on “Water Resource Security in the Mekong Region”. This particular Talking ASEAN featured as resource persons H.E. Watt Botkosal (Deputy Secretary General of the Cambodian National Mekong Committee), H.E. Ambassador Pou Sothirak (Executive Director, Cambodian Institute for Cooperation and Peace), Dr. Chheang Vanarith (Former Executive Director of CICP, Co-Founder and Chairman of Cambodian Institute for Strategic Studies and Consultant for Southeast Asia Program for the Nippon Foundation in Singapore), and Dr. Mak Sithirith (PhD in Geography (NUS in Singapore) and Post-doc in Water Governance & Climate Change (UNESCO-IHE, The Netherlands)) with Pou Sovachana (Deputy Director in Charge of Research and Publication, Cambodian Institute for Cooperation and Peace) moderating.

The objectives of this Talking ASEAN were to: (1) identify the threats and potentials posed by water resource management both from a security and non-security aspect; (2) discuss the current state of efforts at managing water resource security at the national and regional level; (3) promote multi-stakeholder dialogue on trans-boundary water resources management and strengthen regional networks whose tasks are to promote greater collaboration in the Mekong region; (4) discuss how ASEAN can promote greater management of water resource security at the regional, national, and sub-national level, particularly the Mekong River Commission in putting in place good governance practice on the Mekong River; and (5) provide relevant recommendations on how to manage water resource in the Mekong River area in order to promote sustainable development and conflict free environment.

This discussion report summarizes the key points of each speaker as well as the question and answer session that followed.

Talking ASEAN Series across ASEAN region is supported by the U.S. Government through the ASEAN-U.S. PROGRESS (Partnership for Good Governance, Equitable and Sustainable Development and Security).

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Deputy Secretary General of the Cambodian National Mekong Committee

H.E. Watt Botkosal was the first person to speak. The purpose of his presentation was to share his views on water security concepts related to the commitments of the Cambodian government and the Mekong River Commission (MRC) and to discuss how to improve the water security in terms of water governance.

H.E. Watt Botkosal mentioned that there were several issues and challenges in the Mekong River Basin. First, there was an unprecedented economic and population growth, giving rise to increased water demand for industrial, municipal and irrigation uses, and for the production of energy. Second, sustainability, health and quality of life requires that water quality and important aquatic habitats need to be protected. Third, the basin is exposed to climate change and has a high flow variability that causes floods and droughts. Fourth, the medium and long-term needs and challenges could not be tackled effectively by one single riparian country.

H.E. Watt Botkosal urged for an increased transboundary cooperation that could go a long way to realize higher economic benefits and lower environmental impacts in transboundary river basins. H.E. Watt Botkosal gave two recommendations in order to resolve the issue: (a) developing national water security plan and (b) providing a clear water

H.E. Watt Botkosal

SPEAKERS’ PRESENTATION

planning framework in terms of sustainable water supplies to development sectors, protection of water and related resources, flood and droughts management and mitigation. To end, H.E. Watt Botkosal underlined that water security was a regional challenge.

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As the second person, H.E. Ambassador Pou Sothirak began his presentation by explaining the importance of the Mekong River. The Mekong River is one of the great river systems of the world passing through more countries than any other rivers in Asia. It supports many unique ecosystems and a wide array of globally-threatened species of fish and wild life. The Mekong River provides food, drinking water, irrigation, transport, and energy to more than 60 million people in China, Myanmar, Laos, Thailand, Cambodia, and Vietnam who live on its basin.

However the development of hydropower dams on the Mekong River has begun to alter the rhythm of the river, transforming natural flow which can then lead to dreadful consequences for the inhabitants living along the river basin. Damming the Mekong River causes unprecedented environmental and social problem and imposes severe ecological deterioration of this mighty river. The Xayaburi Dam is the first of eleven dams proposed for the Lower Mekong River in Southeast Asia. If built, it could open the floodgates for all eleven dams to go forward, with significant consequences for the Mekong River and its people.

Tonle Sap is the largest fresh water lake in SE Asia and one of the most productive inland fisheries in the world, supporting over 3 million people and

H.E. Ambassador Pou Sothirak


Executive Director, Cambodian Institute for Cooperation and Peace

providing 60% of Cambodians’ protein intake. Tonle Sap is in crisis as the weakening flows due to upstream dams trigger declining fish yields. Tonle Sap’s life-line benefits are being traded off with hydropower projects that supposedly provide cheaper electricity to fuel economic development. However H.E. Ambasador Pou Sothirak argued that without fish, over one million people who live around Tonle Sap Basin face food security shortage.

For years, dam builder have assured governments with arguments that hydroelectricity can reduce the cost of high energy price, fuel the economic growth, and alleviate poverty. However, the rush for hydro power must not be based on ill-thought and poorly coordinated policies across the Mekong Basin. Accurate assessment on the impact of these dams are however difficult and must be carried out diligently. There are numerous evidence from around the world that suggests large dam projects have resulted in environmental degradation and social implication. Many dam projects proposed on the Mekong mainstream do not appear to meet environmental or socioeconomic criteria. As such they were proven to be damaging to the environment and fisheries.

Ambassador Sothirak recommended that effective measures are needed to mitigate impacts of hydropower dams on human security. The government must rely on impartial experts to conduct a full cost-benefit analysis, thoroughly weighing in the development-environment tradeoffs in term of electric power and food security and livelihood. In addition, peace, stability and prosperity in the region depends on well-coordinated management of how best to use water resource of the Mekong River to support human security in the best interest of everyone.

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The third person to speak was Dr. Chheang Vanarith. He explained that sustainable governance of the Mekong River is vital to ASEAN Community building, given that the Mekong River basin is the lifeline of more than 60 million people. The river is the source of food security and livelihoods. Hydropower dams and climate change are threatening the livelihoods of millions of people. The dams degrade the river’s rich biodiversity, disrupt fish migration cycles, and trap nutrient-rich sediments.

The Mekong River Commission (MRC), which was founded in 1995, aims to ensure that the river is developed in the most efficient manner that benefits all member countries and minimize harmful effects on the people and the environment. Cambodia, Lao PDR, Thailand, and Vietnam are the four members of MRC, while Myanmar and China are the dialogue partners of MRC. However, MRC has not effectively managed the trans-boundary water resources due to the lack of legally binding agreements. It is therefore necessary to strengthen the enforcement role of MRC.

In addition to MRC, there are various regional initiatives related to economic integration in the Mekong sub-region, among them: the ADB’s Greater Mekong Sub-region (GMS) program, the ASEAN Mekong Basin Development Cooperation (AMBDC)

Dr. Chheang Vanarith


Former Executive Director of CICP, Co-Founder and Chairman of Cambodian Institute for Strategic Studies and Consultant for Southeast Asia Program for the Nippon Foundation in Singapore

and the Initiative for ASEAN Integration (IAI). These initiatives mainly focus on infrastructure development, energy, trade, investment, agriculture, forestry and minerals, tourism, science and technology, and human resources development.

As ASEAN is moving towards a people-centered community and a community of opportunities, it needs to foremost address poverty issues and development gaps. Mismanagement of the Mekong River has had severe adverse repercussions on millions of people whose livelihoods depend very much on the river. Development without considering the interests of the people will lead to widening disparity, social and political ills, which in turn lead to social and political conflicts.

Due to strong considerations of national sovereignty and interests, and the lack of legally binding regional instruments, it is difficult to manage trans-boundary water resources. There is a need to strengthen the institutional capacity especially with regards to the implementation of policy blueprints of MRC and ASEAN. Strong partnership between ASEAN and other sub-regional mechanisms or institutions is vital to deepened regional cooperation and integration.

Dr. Vannarith suggested that the Mekong River management should be regarded as one of the core issues of ASEAN. In addition, ASEAN’s dialogue partners need to show more commitment and support in assisting the people in the Mekong sub-region.


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Dr. Mak Sithirith

The last speaker to present was Dr. Mak Sithirith. He explained that water security was a governance challenge in relation to transboundary river basins. The state controls the river flowing within the territory. As such, the issue was perceived as a ‘state security’ issue.

Regarding Mekong damming, dams have been used by the state to control river and to secure their flow, their volume and their quality. Up until now, China has built 6 dams in Lancang River on the mainstream of the Mekong, causing downstream hydrological alteration. The existing dams have already increased the dry season flow by 28% and decreased the wet season flow by less than 4% at the 3S rivers (Sesan, Sekong, and Srepok) outlet. Cambodia is making efforts to ‘secure the river flow’ in 3S Rivers in Cambodia by building the Lower Sesan 2.

The damming has affected the communities. The affected communities demand to ‘restore the natural flow’ of the river. Natural flow also implies full or partial restoration of the pre-dam resource regime, including riverside agriculture and replenished fish stock. In addition, dams cannot secure water quality, it causes water quality problems and water pollution. Dams physically block fish migration, but also the change in water temperature, flows and

PhD in Geography (NUS in Singapore) and Post-doc in Water Governance & Climate Change (UNESCO-IHE, The Netherlands)

turbidity—reduces fish population and fish catch.

The Mekong River Commission (MRC) mandate for transboundary cooperation is hampered by a lack of mandate and commitment to respond to community complaints and issues of international tributaries. The MRC 1995 Agreement does not allow national sovereignty to be overruled in mitigating negative transboundary social and ecological impacts of water development. Nevertheless, the MRC should continuously review and revise the MRC 1995 Agreement to keep up with the increased socio-economic and demographic developments in the basin.

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Q&A SESSION

Comment No. 1

Is there any momentum in revising the MRC 1995 Agreement? Is it a topic left untouched?

Dr. Chheang Vanarith

I do not see any momentum due to the concerns of sovereignty issue and narrowly defined interests. Cambodia has tried to convince Myanmar and China to be an observer to the MRC. Momentum can be gained through ASEAN and its dialogue partners to push for a more legally binding agreement. To gain momentum we need to have these external actors and civil society as well.

H.E. Watt Botkosal

The 1995 MRC was established based on goodwill and the ‘Mekong spirit’. It comes from the 1957 Mekong Committee. The agreement is about the sustainable development in the Mekong region, including with China and Myanmar. But they show no interest to join the MRC. We try to implement more effectively. The agreement is still considered relevant regionally.

However, the capacity of the countries involved is still limited, especially regarding scientific information and data on how the Mekong can be managed sustainably. Water quantity and quality of the Mekong is still good, but it sees less development when compared to Europe and Africa.

Countries have different interests, policies, and strategy. Cambodia sees it as tourism potential. Laos sees it as potential hydropower energy source. The MRC is still under-implemented. We try to manage any disputes through close cooperation and good spirits. In the end, the MRC should not stay alone. We need international assistance. The 1995 Agreement is not enough so we need more assistance to support us.


Is the commission still relevant today? Why would we want to revise it? The commission is like ASEAN on a smaller scale. It only promotes coordination but no enforcement. What is more important is enforcement, to ensure compliance. The governments along the Mekong manage the issue separately. China, recently, opens up to the idea of data sharing, but they are still not a member of the Commission. We can only ask them to cooperate, but to what end?

Diplomacy can only go so far, but there is a limit. The Commission has given good advice, such as the ten years moratorium of activities in the river, but no one listened. The predominant issue in the last meeting of the commission is on funding—not on the development of dams.

Donors are also questioning the relevant of the MRC, asking to move the headquarters from Laos to Cambodia.

Dr. Mak Sithirith

There is too much politics in the region. China is member of the Great Mekong Subregion, but not the MRC. Thailand, Laos, Myanmar, China have signed an agreement of navigation, so this is another institution. Different countries are bound by different agreements, different mandates. ASEAN has to play a certain role, otherwise all these agreements will make politics more complicated.

Comment No. 2

Why does the MSC member countries never come to an agreement on a matrix of the benefits, costs of the damage and losses of hydropower energy; especially when it seems that nuclear is currently not an option?

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Q&A SESSION

H.E. Watt Botkosal

We should think how to minimize costs or impact of any development activities. To bring together different concepts together—Cambodian eco-tourism and Laotian hydropower development.


I was a minister of energy for Cambodia, I was electrical engineer, but please let me tell you this: the hydrodam is a good policy because it is clean and good. But we have to do it right. Developers know that it is a mega project. Xayaburi Dam costs USD 2 billion. Laos said the dam will improve the GDP and livelihood. I bet there is no national grid in Laos to service everybody. Don’t just blindly go with hydrodam. The cost-benefit has to be balanced.

Comment No. 3

How to improve effective implementation in a project?

H.E. Watt Botkosal

Coordination between donor and government is important. Donor should look into integrating every sector together to develop the river basins. It is challenging, however, to bring different agencies together. We need to promote national water security plan, and regional water security plan.

Comment No. 4

When we talk about stakeholders, the role of private sector is also important. It is Malaysian and Thai companies that have been involved in hydrodam development. It is real dilemma between electricity development and sustainability.

Comment No. 5

What kind of measures or compensation that governments should provide to local communities affected?

Comment No. 6

If we compare the AEC Blueprint and the ASEAN Community 2025 Blueprint, is there any different approach on resolving the water resource management issue?

Dr. Mak Sithirith

We have to address human security, food security, water security, and environmental security. There are initiatives to promote environmental sustainability in the river basins and the surrounding forests by civil society. The government does not have to do everything. However, the government can possibly provide alternative livelihood in the context of diminishing fishes, for example, promotion of agriculture and access to land.


In the 2025 Blueprint, water resource management is not mentioned specifically. It only mentioned tranboudary issues but not water security. The issue should have been explicitly included in the Blueprint as it is very important for the Mekong countries.

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Rahimah Abdulrahim (Executive Director)

Hadi Kuntjara (Deputy Director for Operations)

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