[asia-apec 1703] Thailand: ADB feels pressure over sewage plant loan

[Kevin Yuk-shing Li]

ADB feels pressure over sewage-plant loan

PRESSURE has grown for the Asian Development Bank to review its Bt4-billion
loan to the controversial Klong Dan wastewater treatment plant, with more
than half of the Senate backing the move because of serious concerns over
its environmental impact.

Some 102 Senators signed a letter in December to ADB President Tadao Chino
suggesting the loan review, according to a statement issued at a press
conference at Parliament yesterday.

"We urge the bank to take immediate steps to review its support of the
project in its present form, with particular regard to addressing the
concerns of local residents and the bank's lending policies," the letter
said.

The letter suggested the project might be against ADB policies on
incorporation of social dimensions in bank operations, good governance,
confidentiality and disclosure of information, and voluntary resettlement.

"Nor was any environmental impact assessment or assessment of social
impacts for the site at Klong Dan carried out," the letter continued.

The Bt23.7-billion project has already received two disbursements of US$80
million (Bt3.44 billion) and $150 million (Bt6.45 billion) in loans from
the ADB.

The plant, started in 1997, is situated on the coast amid replanted
mangrove swamps. It has drawn constant criticism from environmentalists and
Klong Dan residents.

A group of 72 senators visited the area last month to assess the project's
impact and concluded that local residents had not been adequately informed
about the plans.

Among the senators who signed the letter were Jon Ungphakorn, Kraisak
Chonhavan, Chirmsak Pinthong, Charoon Youngprapakorn, Niran Pitakwachara,
and Maleerat Kaewka, some of whom are known to be sympathetic to civic
pressure groups. Niran told the media that Senators would also campaign to
get the incoming Thai Rak Thai government to review the project.

"We want the new incoming government to investigate, with transparency, the
way in which the land for the plant was purchased," said Charoon. He
described the plant's chosen site as a "virginal environment," which
Senators feared would suffer a negative impact if the project went ahead.

Meanwhile, Deutsche Press-Agentur quoted ADB's resident Thailand advisor,
Craig Steffensen, as saying: "We're looking at what, if anything, can be
done to make this project better. We will see if some additional
environmental safeguards can be put in place without disrupting the returns
and turning the project into a white elephant financially.

"If it's recommended that the project be shut down and some other sort of
project put in its place in Samut Prakan, that's certainly an option we're
willing to explore. But we're about $300 million into the project now, so I
think what we're hoping is that we'll find effective
measures for improving the existing project," Steffensen said.

BY KAMOL SUKIN
The Nation
January 18 2001