Land Issues Working Group

Sustainable land use and ecosystem services come under scrutiny

hanna — Fri, 17 Feb 2012 08:22:09 +0000

Vientiane Time, February 17, 2012

The capacity for commercial agriculture plantations to alleviate poverty in rural areas of Laos must increasingly be weighed against the potential impacts on ecosystem services, sustainability of land resources and traditional livelihoods.

The National Economic Research Institute (NERI) yesterday presented the results from a study on the economic valuation of ecosystem services for sustainable land use at a national policy workshop in Vientiane. The case study compared both the financial returns and the environmental costs of different land uses such as non-timber forest products collection, upland rice farming and maize and rubber plantations in Oudomxay province.

The study demonstrates that commercial agriculture plantations such as maize and rubber have the capacity to alleviate poverty in the short term, but without necessary environmental safeguards in place, land resources are exposed to environmental risks, including the loss of ecosystem services. By comparison, the traditional land uses that were studied like upland rice farming and non-timber forest products collection are largely sustainable practices for now but are unable to contribute towards alleviating the poverty of rural households.

NERI Director General Dr Liber Libouapao said the majority of people living under the poverty line in Laos reside in remote areas and are dependent on the natural environment for their livelihoods. Dr Liber also stressed that the agriculture and forestry sectors have traditionally been the foundation of the national economy, so they need to be modernised and promoted.

The study suggests that current agricultural land uses will have to be improved if they are to contribute towards the broader sustainable development goals of Laos, according to a press release from the workshop. Measures to mitigate the potential environmental impacts of commercial agriculture plantations must be integrated into land use and farming practices. In the case of traditional land uses, value-added options and alternative environmentally friendly income generating activities should be promoted among farmers.

The workshop highlighted the importance of environmental valuation studies to inform decision makers who work on poverty reduction and sustainable development. Such information is critical to support sustainable land use decisions, by balancing financial benefits with the values of natural resources and their ecosystem services.

Participants from the ministries of Planning and Investment, Natural Resources and Environment, and Agriculture and Forestry joined representatives from the National Assembly and Oudomxay province to share their experiences regarding land use and discuss possible policy changes. The case study was part of the Poverty-Environment Initiative in Laos, which is supported by the United Nations Development Programme and the United Nations Environment Programme (UNDP-UNEP)

National Assembly meets with constituents in Vientiane

hanna — Thu, 16 Feb 2012 08:00:34 +0000

Vientiane Times, February 16,2012

Problems related to land use, education, transparency of state bodies and medical ethics are the main concerns raised by the public to the National Assembly (NA). The NA is committed to submitting these issues to the government for resolution to allay the fears of the public.

“We, the NA members, have heard about these problems and forwarded them to the responsible units and bodies so that they can be addressed,” NA Economic, Planning and Finance Committee Vice Chairperson Dr Buakham Thipphavong said. An NA member group led by Foreign Affairs Committee Chairperson Dr Koukeo Akkhamounty yesterday met with constituents from the Ministry of Information, Culture and Tourism at the National Culture Hall in Vientiane to discuss the outcomes of the second ordinary session of the NA’s Seventh Legislature and the problems that constituents face.

During the session, the NA received 40 complaints through its hotline concerning the economic sector, most of which questioned the transparency of the Ministry of Finance, especially regarding customs and taxation. Dr Buakham said the complaints contain the names of customs units and officials involved in corruption, and call on the Minister of Finance to look into the matter.

The Ministry of Natural Resources and Environment received the second highest number of complaints among government bodies, most of which were focused on land and forestry issues. A recent inspection by the NA confirmed the presence of undesirable conduct within the sector. “If negative activities are not fully addressed, they will lead people to mistrust the Party, government, and our new regime,” Dr Buakham said. The public also made their voices heard through the hotline regarding the auditing of Party and government officials’ assets.

During the meeting, the constituents raised a number of issues, ranging from transparency in the education sector to anti-social behaviour and medical ethics. Concerning education and human resource development, NA member Dr Sisaliew Savengsuksa contended that the government has forged no link between its policy on population and its socio-economic plan, meaning the country will face hurdles in the future.

Other NA members, Mr Buangeun Xaphouvong and Ms Vanpheng Keonakhone, brought up the issue of anti-social behaviour and activities in the cultural sector, as well as possible solutions. Some constituents called on NA members to ask the government to reassess its policy regarding the building of media organisations’ capacity to be financially self-reliant.

The meeting was attended by Minister of Information, Culture and Tourism Professor Dr Bosengkham Vongdara, who said he highly valued the chance for NA members and their constituents from the ministry to share in finding solutions to the problems faced by society.

Vietnam targets investment in Laos’ central and southern provinces

hanna — Tue, 14 Feb 2012 07:09:00 +0000

Vientiane Times, February 14, 2012

A government report disclosed last week that 93 percent of the total value of Vietnamese investment in Laos lies in eight provinces in central and southern Laos.In total, Vietnam has investments in 16 of the 17 provinces in Laos, including the capital. The report stated that as of December 2011, the Lao government had approved 207 investment projects with total registered capital of US $3.4 billion.

Some 30.5 percent of this investment capital is in eight real estate and service projects worth US$1.04 billion, another 15.3 percent worth US$521 million has been invested in 33 agriculture and forestry development projects, and 27 percent worth US$921 million has been put into four hydropower projects, with the balance invested in other sectors.

A total of 113 projects worth US$1.55 billion have been undertaken in central Laos, which is equivalent to 45.5 percent of the total value of Vietnamese investment in Laos.With an estimated investment value of US$1 billion, the Vientiane Long Thanh Golf project in the Dongphosy area of Hadxaifong district, Vientiane, is one of the major undertakings in central Laos.

Although there are only 50 Vietnamese projects in the south of the country, the total amount of capital invested in this area, US$1.62 billion, is more than that invested in the central region. Vietnamese Hoang Anh Gia Lai Group invests mainly in rubber and sugarcane plantations, hydropower and mining projects, and is a major player in the south of the country. The southern and central provinces range from Vientiane to Borikhamxay, Khammuan, Savannakhet, Saravan, Champassak, Xekong and Attapeu.

During an official goodwill visit to Laos by Vietnamese President Truong Tan Sang on February 9-11, a report that was presented said Vietnam planned to increase its business activities in Laos. It expressed the hope that by 2015 the two countries will reach a two-way trade value of US$2 billion. Two-way trade between Vietnam and Laos has steadily been increasing. In the first 11 months of 2011, the trade value reached US$636 million, a year-on-year increase of 48 percent. Of this sum, Vietnam’s exports to Laos amounted to US$239 million, up 32 percent compared to the same period last year.

Vietnam will also seek to remain one of the top investors in Laos over the next three to five years. On its part, the Lao government is committed to facilitating investment and creating more favourable conditions to attract foreign investors. According to the report, Laos and Vietnam will identify potential economic prospects for investment in central and southern areas of Laos in various sectors such as hydropower, processing, and industrial tree plantations.

As Laos and Vietnam share a long north-south border, enhanced economic cooperation between the two countries will benefit those provinces that are adjacent to the border. Laos launched its investment renovation policy in 1986, since when many foreign investors have been attracted to the country, helping to create jobs for the people of Laos. Investors from more than 53 countries are now present in Laos.

Tapioca maker sees sharp increase in cassava supply

hanna — Mon, 13 Feb 2012 06:56:38 +0000

Vientiane Times, February 13, 2012

The Lao Indochina Group Public Company Tapioca Factory expects cassava plantations and the number of its member farmers to increase by up to three times its initial target for this year. “I’ve talked to farmers and each seems to have expanded their fields by about one or two times,” company Chairman Mr Sengmaly Sengvatthana said at a press conference in Vientiane on Friday.

The company reported last year that it had 7,689 hectares under cassava cultivation, which provided employment opportunities for over 2,713 families and company members, in 171 villages in Vientiane and the provinces of Borikhamxay and Vientiane. “We now have around two or three times more members than initially targeted,” Mr Sengmaly said. The company originally planned to expand cultivation to 10,500 hectares this year, but this may increase by two or three times the initial estimate due to the higher number of farmers, he said.

The increased cultivation of the crop has boosted supply since early last month, meaning the factory has had to create extra space to store the cassava.Some 200 to 300 trucks deliver cassava to the plant daily and currently have to queue for two or three kilometres as they wait to unload. The company is working with the Naxone village authorities to find empty land where cassava trucks can park. “Now we have two more hectares for parking, which accounts for about one-third of those trucks,” he said.

Currently the factory has two production lines and can produce 320 tonnes of tapioca from 1,200 tonnes of cassava each day. However, it is now receiving 1,600 tonnes of cassava a day because it is the harvesting season, Mr Sengmaly said. “There will be no cassava trucks when the wet season comes in June or July because farmers won’t grow the crop at that time of the year,” he said, adding that tapioca production will stop for three months until the new production season arrives in October.

“At present, we are spending about 16 billion kip (US$2 million) to add two more production lines by the end of this year to boost tapioca output,” he said. The factory must have four production lines to produce at least 600 tonnes of tapioca from 2,400 tonnes of cassava per day. The factory, located in Naxone village of Pakngum district, Vientiane, expects cassava cultivation to continue to increase sharply next year because farmers are gearing up to grow even more crops.

Potassium mine in Thakhek gets the green light

hanna — Mon, 13 Feb 2012 06:33:39 +0000

Vientiane Times, February 13, 2012

The Lao government has given permission for the Vietnam Chemical Group (Vinachem) to excavate and process potassium in Khammuan province. Dr Bounthavy Sisouphanthong signs the agreement with Mr Nguyen Dinh Khang, witnessed by Lao President Choummaly Sayasone and Vietnam President Truong Tan Sang and other high-ranking officials from Laos and Vietnam.

According to a Vietnam News report, the Vinachem group will invest US $450 million in the project in Nongbong village, Thakhek district, to extract and process potassium, which is also known as kali salt. The Vietnamese company plans to excavate potassium in a 10 square kilometre area, with a concession period of 20 years which can be extended for another five years.

The agreement was signed in Vientiane on Thursday between Deputy Minister of Planning and Investment Dr Bounthavy Sisouphanthong on behalf of the Lao government and Vinachem General Director Nguyen Dinh Khang. The signing was witnessed by Lao President Choummaly Sayasone and his Vietnamese counterpart Truong Tan Sang and other high-ranking government officials from both sides. The agreement was signed during an official goodwill visit to Laos by the Vietnamese president, who was in the country from February 9-11 for activities aimed at strengthening the longstanding cooperative relationship, friendship and special solidarity between Laos and Vietnam.

Under the agreement, the Lao government also granted the Vietnamese company permission to conduct a survey on a 196 square kilometre site for potential future potassium excavation. The Vietnamese media reported that Vinachem will build a factory to process the potassium on site in Thakhek district. The plant will have the capacity to process 320,000 tonnes of potassium per year.

Director General of the Mining Department of the Ministry of Energy and Mines, Dr Simone Phichith, told the Vientiane Times on Friday that the US$450 million project will supply potassium for domestic consumption and also for export. He said the factory should take two years to build, after which extraction operations will begin. The project is expected to contribute to the local economy as well as provide potassium for the Vietnam market.

Mining is one of the main income earners in Laos and attracts the second largest investment after power generation. According to a report from the Ministry of Planning and Investment, the government approved US$3.1 billion worth of investments in the mining sector in the decade from 2000 to 2010. As of April 2011, the government had granted approval for 152 mining companies to operate 256 mining concessions across the country.

One of the major miners in Laos is the Sepon Gold and Copper Mine, which operates in the central province of Savannakhet. Another large mining operation is the Phu Bia project in Vientiane province, which exports gold and copper concentrate. Vietnam is one of the largest foreign investors in Laos, with 224 investment projects worth US$3.57 billion. Vietnamese investors focus mainly on the mining, electricity, agriculture and service sectors in Laos.

Laos backs Vietnam’s bid for top investor ranking

hanna — Mon, 13 Feb 2012 06:12:59 +0000

Vientiane Times, February 13, 2012

Vietnam’s investment in Laos is on track to keep the country atop the list of foreign countries doing business in Laos, which Laos fully supports. Laos will continue to support Vietnam’s bid to maintain this ranking over the next 3 to 5 years, it was revealed at a meeting held in Champassak province on Friday.

Vietnamese investors are currently operating 432 projects in Laos worth US$5.1 billion, and Vietnam ranks first among the 53 countries currently investing in the country.Vietnamese business operations are mainly in the mining sector, valued at US$1.7 billion. In the services sector they are valued at US$1.2 billion, in the energy sector investments are worth US$867.6 million, and in agriculture Vietnamese operations top US$709.6 million.In six central and southern provinces, Vietnamese companies are operating 147 projects worth US$2.9 billion, of which US$460.9 million has been invested in the mining, energy and agriculture sectors.

In his remarks at the meeting, Deputy Minister of Planning and Investment Somchith Inthamit said he highly valued the increasing Vietnamese investment in Laos, which is significantly contributing to socio-economic development and helping to improve living conditions. It is the government’s objective to ensure that conditions are favourable for Vietnamese investors in major sectors, and that the investment climate is positive for other Vietnamese businesses considering setting up operations in Laos, he said.

To this end, the government will study the socio-economic situation and development plans to identify the potential in the central and southern provinces, and select possible areas for investment. Despite the increase in the number of investments, the government will oversee all projects and evaluate those already in operation in terms of social and economic development, to determine the difficulties they face and any barriers to their progress.

Vietnam’s Deputy Minister of Planning and Investment Nguyen The Phuong confirmed the increase in Vietnamese investment in Laos, saying Vietnamese investors are confident that socio-economic development in Laos will help to facilitate their long-term business operations. Vietnam’s President Truong Tan Sang and Deputy Prime Minister Nguyen Xuan Phuc, together with Lao Deputy Prime Ministers Dr Thongloun Sisoulith and Mr Somsavat Lengsavad also attended the meeting to hear the positive comments and complaints raised by investors.

Also at the meeting Laos and Vietnam agreed to establish an office to strengthen capacity building in business units, and loan provision for the Viet-Lao Rubber Company, Dak Lak Rubber Company and Hoang Anh Attapeu Joint Stock Company.

Companies to explore mining and hydropower possibilities

hanna — Thu, 09 Feb 2012 06:44:24 +0000

Vientiane Times, February 9, 2012

The Phouphieng Mineral Export-Import Sole Company is teaming up with the Mekong Mining Company to study the possibilities for bauxite and potassium mining and hydropower in Laos. A Memorandum of Understanding was signed on Tuesday in Vientiane between Phouphieng Company President Mr Vilaysith Liumxayachak and Mekong Mining Company President Mr Andrew Kent. Officials from both sides attended, along with the Vice President of the National Science Council, Dr Maydom Chanthanasinh.

To explore potassium deposits, the companies will investigate sites at Somsa-ard and Palay villages in Outhoumphon district, Savannakhet province, and in Thaphabath district in Borikhamxay province. For bauxite and hydropower, the project involves areas in Champassak, Xekong and Attapeu provinces, with 100 percent of the financial backing coming from the two companies.

“The companies expect to spend about US$70 million during the first three years of study,” said Mr Vilaysith. The study will provide information on the project’s economic feasibility for investors. “We also plan to establish facilities for ore excavation and power generation for future sale and export,” he said. Laos’ abundant natural resources offer opportunities to produce minerals and electricity for sale and export.

Phouphieng is working with overseas companies, notably the Mekong Mining Company, to propose projects to the government at each level of implementation, Mr Vilaysith said. The Phouphieng Mineral Export-Import Sole Company has previously obtained potassium mining rights from the government and in the future will request rights for hydropower plant construction and bauxite mining.

Close collaboration between the two companies will help the project to effectively and successfully meet its goals, Mr Kent said. “We also need the support of the government to provide us with opportunities in investing in these sectors and to provide cooperation at every level,” he said. The project will offer the opportunity for closer cooperation through a joint venture between the two companies in contributing to socio-economic development.

Xayaboury farmers switching from sweetcorn to cassava

hanna — Wed, 08 Feb 2012 12:45:53 +0000

Vientiane Times, February 8, 2012

Farmers in Xayaboury province may reduce the amount of sweetcorn they grow for export this year and grow cassava instead to supply a nearby processing plant. Provincial authorities expect that sweetcorn growers will make the switch to cassava in the upcoming wet season, saying that cassava is likely to prove more profitable.

Last year, many sweetcorn farmers began growing more cassava as they were concerned about problems with the Thai market,according to a report from the Industry and Commerce Department. Now cassava looks even more promising after a Chinese company opened a processing facility in the province recently. The factory has the capacity to produce 250 tonnes of tapioca a day from at least 300 tonnes of cassava, department Director Mr Somdy Souksavath told Vientiane Times yesterday. Provincial farmers grew about 4,000 hectares of cassava last year, which left room for more to be planted this year to meet the factory’s needs, he said.

Last wet season, the provincial authorities hoped farmers would be able to grow 60,000 hectares of sweetcorn. They exceeded production targets slightly, planting out 60,900 hectares in total. They harvested about 400,000 tonnes, Mr Somday said, but there were now lingering doubts about the viability of the crop.

The Thai market has traditionally been the main destination for sweetcorn and other crops grown in Xayaboury province. About 90 percent of the sweetcorn grown in the province is exported to Thailand, which borders Xayaboury, allowing relatively easy access to Thai markets. Recently, sweetcorn traders have had problems exporting the crop to Thailand, after the government introduced a temporary tax on food imports to protect domestic farmers.

Most of the remaining previous sweetcorn harvest is now being held in storage by traders until it can be sold to Thailand between March 1 and June 30, Mr Somdy said. The department is now advising traders and farmers on the best methods of storage to ensure the crop is still in good condition when the time comes to sell it.

Mr Somdy believes that some farmers are likely to opt to grow cassava in view of the uncertain market for sweetcorn. Most of those growers are in Paklai and Kaenthao districts, as they are close to markets within the province. Sweetcorn will remain an important staple for the province, however, and to ensure that this year’s harvest is of good quality, provincial officials are working with domestic and foreign companies to set up five commercial dryers, which have a combined capacity of more than 200,000 tonnes per year, Mr Somdy said.

Last year, Xayaboury farmers produced more than 400,000 tonnes of sweetcorn, of which over 300,000 tonnes was sold to Thailand, while the rest went to domestic markets, mainly in Vientiane. Sweetcorn is currently selling in the province for 1,000-1,200 kip per kilogramme, depending on farmers’ distance from the market, he said. Cassava meanwhile, a much heavier crop, sells for about 400 kip per kilogramme, according to the department’s domestic section.

Chinese rural ire grows with land grabs: survey

hanna — Tue, 07 Feb 2012 11:17:19 +0000

Reuters, February 7, 2012

Premier Wen Jiabao said at the weekend that China’s government failed to give farmers enough protection from land confiscation for what many of them see as paltry compensation. The survey of 1,791 farmers overseen by the Landesa Rural Development Institute, based in Seattle, gave statistical flesh to the extent of complaints over losses of land to commercial development, an issue that triggered a dramatic ten-day confrontation in Wukan Village in Guangdong province last year.

“It is, therefore, not surprising that dissatisfied farmers outnumber the satisfied by a margin of two to one,” said a summary of the survey, which found 36.7 percent of respondents said they were “dissatisfied” and 16.7 percent said they were “very dissatisfied.” The summary was emailed to Reuters. By contrast, 2.8 percent of respondents said they were “very satisfied.”

“To make an enduring dent in tenure insecurity and to improve welfare for its 700 million rural people, China must consider carrying out fundamental reforms of the tenure system and strict enforcement on the ground,” the Landesa researchers said in their summary.

Wen has said that he too wants stricter protection of farmland and more compensation for land seizures, but the Communist Party government has also said it will keep to its system of collectively-owned land. “What is the widespread problem now? It’s the arbitrary seizure of farmers’ fields, and the farmers have complaints about this, and it’s even sparking mass incidents,” Wen said in Guangdong on Saturday, according to a Xinhua news agency report.

“Mass incidents” is the official euphemism for protests, riots and mass petitions. Farmers in China do not directly own most of their fields. Instead, most rural land is owned collectively by a village, and farmers receive leases that last for decades. In theory, the villagers can collectively decide whether to apply to sell off or develop land. In practice, however, state officials usually decide. And hoping to win investment, revenues and pay-offs, they often override the wishes of farmers.

The Landesa survey, done across 17 provinces in mid-2011, found 43.1 of villages had experienced “takings of land” for non-farming uses since the late 1990s, and an accompanying graph showed that such takings rose dramatically from 2007. Villagers “received some compensation in 77.5 percent of all cases as promised but did not receive compensation in 9.8 percent of cases, and were neither promised, nor received compensation in 12.7 percent of cases,” said the survey summary.

Local governments across China have pushed increasingly bold reforms to merge patchwork fields and settlements into larger farm tracts and villages, with aggregated fields rented to investor-villagers or companies. That trend has been reinforced by the growing numbers of residents leaving villages to find long-term work, although most of them say they want to keep their land. China has about 153 million migrant workers living outside their hometowns.

The survey found 17.7 percent of villages have conducted out such land consolidation plans or are doing so, and 57.2 percent of the villagers affected were left without any farmland. “The overall picture here is troubling, because this new urbanization program was started in an attempt to preserve and reclaim some of the country’s farmland,” said the summary. ”Instead, only a small percentage of the vacated residential land – and a minority of even the vacated farmland – is being used for agricultural purposes.”

Govt urged to halt export of unprocessed wood

hanna — Thu, 02 Feb 2012 16:08:54 +0000

Government is urged to halt the export of unprocessed timber because the Lao wood processing industry is experiencing a shortage of raw materials.

Vientiane Time, February 2, 2012

The Lao wood processing industry expects to face a shortage of raw materials this year if the government continues to export unprocessed timber. Lao Wooden Products Association President Mr Thongsavanh Souliyamath made the comment yesterday after the government announced a decision to postpone its logging quota, which could slow the supply of timber to the domestic wood processing industry.

The government still has a policy to allow felling of trees in development project areas, such as road construction sites, and mining and hydropower plant development areas. However, most of the unprocessed timber extracted from these areas is sold to neighbouring countries.

Mr Thongsavanh, who is also the managing director of the Lao Furniture Industry Company in Vientiane, said association members would like the government to halt the export of unprocessed timber and instead sell the stocks to the domestic wood processing industry, which is experiencing a shortage. “We have learnt that there is about 300,000 cubic metres of timber from development project areas,” he told Vientiane Times.

He explained that the wood processing industry has the capacity to process this amount of timber, so the government should supply the raw materials for processors to add value to the country’s natural resources prior to export. Mr Thongsavanh said Lao s can benefit more from supplying unprocessed wood to domestic firms than exporting it, because processed timber can generate more income than unprocessed wood. Building up the industry in Laos would also create more jobs.

At present, there are about 1,000 small and large wood processing plants nationwide, employing more than 20,000 workers. About 100 of these units are members of the Lao Wooden Products Association, which operates under the umbrella of the Lao National Chamber of Commerce and Industry. A number of factories have markets in China after attending trade exhibitions in the country. Some have invested in new technologies in order to make more efficient use of wood in line with government policy.

According to a study on timber supply in Laos carried out by the Global Forestry Service Inc, Laos exported about 640 billion kip (US$80 million) worth of semi-finished and finished timber-based products last fiscal year. The major importers of Lao timber are Thailand with a trading value of about US$22 million, Vietnam with a trading value of US$11 million, and Japan with a trading value of US$4.5 million. The European Union and Australia also imported Lao timber products worth US$147,579 and US$151,691 respectively.

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