THE BELT AND ROAD INITIATIVE (BRI)
China’s Belt and Road Initiative (BRI), started in 2013 (known then as OBOR – One Belt One Road), is a trillion-dollar long-term infrastructure, policy, and investment program that aims at accelerating the economic integration of countries along the route of the historic Silk Road. This encompasses at least 70 countries of Asia, Africa, and Europe, together representing more than a third of the world’s GDP and two-thirds of the world’s population.
According to its website, the BRI aims to promote joint “development plans and measures for advancing cross-national or regional cooperation” between the countries involved. “This includes intergovernmental cooperation and multi-level macro policy exchange, communication mechanisms and policy support for the implementation of large-scale projects and the coordination in monetary policy,” for which energy represents an important target. Consequently, power plants, including hydroelectric dams, are a significant part of BRI projects.
THE LOWER SESAN 2 DAM
By 2012, the Lower Sesan 2 project had developed into a Chinese government-led joint venture, Hydropower Lower Sesan 2 Co. Ltd., constituted by a Chinese state-owned company, Hydrolancang International Energy (Hydrolancang), Cambodia’s Royal Group, and EVN. The government of Cambodia approved construction of the dam in November 2012, and logging of the reservoir area began in early 2013, with allegations that some of the operations were being used to launder timber illegally logged elsewhere.
Hydropower Lower Sesan 2 Co. Ltd. and local Cambodian government officials reportedly finalised a resettlement and compensation plan for affected communities in January 2014 but compensation was not distributed widely to those affected. Logging of timber in the anticipated reservoir appears to have been largely finalised by February 2017, and the dam’s main gateways were initially closed to begin flooding 30,000 hectares in September 2017, of which most comprised forest, with roughly 5,000 hectares being used for agriculture. As of 2021, Hydrolancang retained a controlling 51 percent of the venture’s ownership shares, while Cambodian and Vietnamese companies own 39 percent and 10 percent, respectively. The project remains Chinese government-controlled. Chinese government banks provided most of the financing, reportedly budgeted at approximately US$800 million.
From 2011 until the dam’s completion in 2018, community members protested and wrote several letters to the company and government officials, but officials repeatedly dismissed community concerns and resisted debate. Some of those who objected were threatened or even jailed.
Although several hundred families initially accepted the resettlement package, over 100 families in the dam’s flood zones refused it. Local authorities intimidated and harassed these villagers. By 2017, when CHNG completed the walls of the dam and began flooding the villages, over 700 families agreed to receive offered compensation packages, but over 180 still refused. Those who refused mostly moved to smaller areas of remaining ancestral land near the newly flooded reservoir area. They started to build houses and later began to attempt to apply for communal land titles from the government. As of March 2021, however, none of the communities that refused to resettle had received a new title.
Construction of the Lower Sesan 2 dam resulted in the displacement of nearly 5,000 people, mostly Indigenous peoples and other ethnic minorities who had lived in villages along the Sesan and Srepok Rivers, two tributaries of the Mekong River, for generations. The project impacted tens of thousands of other people upstream and downstream of the dam who depended on its fisheries for food and income and is likely to have contributed to decreases in fishery yields across the entire Mekong River system, significant since millions of people in Cambodia, Vietnam, Thailand, and Laos depend on fish caught in the Mekong system for food. For average Cambodians, fish makes up 60 to 75 percent of the animal protein in their diet.
Resettled villagers said their agricultural yields also decreased due to the less fertile, rockier soil at resettlement sites, and lost income from fruit and nut trees in their old villages. The government provided no compensation for losses to income from mushrooms, medicinal plants, and other products gathered from communal forests. Well water at most of the resettlement sites was contaminated and undrinkable.
The Sesan River is an important migration route and breeding ground for fish species from the Mekong. A study conducted in 2012 predicted that the project would lead to a 9.3 percent drop in fish stocks across the Lower Mekong Basin and push over 50 species to extinction. Experts had also warned that the dam will change the hydrology and flood patterns of the Mekong River and the connected Tonle Sap Lake, affecting both ecosystems and agriculture. The dam will have a larger impact on fish biomass than any other dam currently planned for construction on tributaries in the Lower Mekong.
In 2014, the Business & Human Rights Resource Centre sought a round of company responses in relation to communities' concerns over the Lower Sesan 2 Hydropower Project.
On 11 June 2018, a group of affected communities filed a complaint with the Compliance Advisor Ombudsman (CAO), the accountability mechanism for the International Finance Corporation, the private sector financial institution of the World Bank Group. One of the dam’s initial project partners, EVN, the Vietnamese shareholder in the dam project, had received general financing from IFC Financial Intermediary clients, ABBank, and another unnamed IFC banking client in the region, although not for a dam project as such. According to the CAO’s website, the complaint has been found eligible for review, demonstrating a connection between IFC funding and the alleged harms suffered, but the complaint adjudication is still in the assessment phase.
The CAO has decided to extend the assessment timeframe twice, once in late 2018 in order to establish contact with additional stakeholders and again in February 2020 in response to a stakeholder’s request. The CAO’s standard compliance mechanisms often take years to finish and do not end with monetary compensation, however, a CAO assessment does not entail a judgment on the merits of complaints. While the report may help the FC avoid similarly harmful errors in the future, it will not provide relief for those harmed by the dam, although remediation and mediation efforts may result in parties providing new forms of compensation to impacted communities who launched the complaint.
Some communities, including those located upstream and downstream of the project, were not consulted at all.
In November 2020, the Sesan communities reached out to China Development Bank, Bank of Communications of China, Agricultural Bank of China, China Construction Bank, China Everbright Bank, China Huaneng Group, Huaneng Lancang River Hydropower Co. Ltd, Industrial and Commercial Bank of China, Vietnamese An Binh Commercial Joint Stock Bank, Crédit Agricole, Crédit Suisse, Vietnam Electricity, Vietnam Electricity International Joint, Stock Company, Standard Chartered, Vietnam Joint Stock Commercial Bank for Industry and Trade, China Merchants Bank, Bank of Ningbo, Shenwan Hongyuan, APG, in order to urge them to exercise their power and influence to ensure that affected communities can have a meaningful dispute resolution process facilitated by the CAO, with the good faith participation of all relevant stakeholders, including provincial authorities.
Of all companies, only four responded as of February of this year: Credit Suisse and Standard Chartered both alleged lack of connection with the project. China Huaneng Group insisted that after a field investigation, they found that the vast majority of the resettlement work has been completed and the living conditions of the relocated people had been greatly improved. Meanwhile, the local authority was continuously working towards addressing a few remaining resettlement issues and that they will keep their attention on this matter. APG stated its commitment to human rights and compliance of UN Global Compact principles for human rights, labour rights, the environment and the prevention of corruption, further asserting that they examined the involvement of the banks concerned and that they will address the concerns in their dialogue with the corresponding banks.
STATES’ DUTY TO PROTECT HUMAN RIGHTS
In general terms, states have the duty to protect and promote the rule of law, including the duty to ensure equality and fair application of the law, while providing for adequate accountability.
Under international human rights law, states are obliged to respect, protect, and fulfil the human rights of individuals within their jurisdiction, which includes the duty to protect against human rights abuse. Accordingly, states are not directly responsible for human rights abuse by private entities, but they may breach their international obligations when they fail to take appropriate steps to prevent, investigate and redress private actors’ abuse.
This approach also encourages states to take steps to prevent abuse abroad by business enterprises within their jurisdiction, especially when the state itself is involved. Accordingly, although states are not legally required to regulate the extraterritorial activities of businesses domiciled in their territory, home states should set forth clearly the expectation that all business enterprises domiciled in their territory respect human rights throughout their operations.
According to the UN Guiding Principles on Business and Human Rights, among other provisions, states are invited to promote laws that are aimed at human rights compliance, ensure that other laws and policies do not constrain respect for human rights but promote it, provide effective guidance to business enterprises, and propel or require business enterprises to communicate human rights impacts addressment.
States are individually and directly obliged under international human rights law, and, accordingly, they perform as the principal agents of the international human rights regime. Where a business enterprise is controlled by the state or where its acts can be attributed otherwise to the state, abuse of human rights by the business enterprise may entail a violation of the state’s own international law obligations. Moreover, the closer a business enterprise is to the state, the stronger thesState’s policy foundations for ensuring that the enterprise respects human rights.
Finally, ensuring access to remedy is part of the states’ obligation to protect human rights and is a key component of the state’s duty to protect.
Therefore, the Cambodian government bears the primary responsibility for protecting the human rights of its people and ensuring that development projects and connected resettlement processes follow international and domestic standards. Cambodia’s constitution and international human rights treaties it has ratified provide guarantees for the protection of fundamental rights, including those to an adequate standard of living, housing, food, water, and health, without discrimination.
On the other side, the government of China should take the necessary steps to ensure that companies involved in large-scale BRI projects properly conduct and disclose social and environmental impact assessments, and must meaningfully consult local communities affected by projects during planning and construction processes. The Human Rights Watch report shows that the Chinese government, instead, offered huge amounts of infrastructure funding without requiring adequate standards to protect vulnerable communities and their rights. However, there is no evidence that the Chinese government imposed any obligations on the Chinese and Cambodian companies who built the dam to follow international and corporate social responsibility standards or provide adequate remedies for the community, or even standards that would apply had the dam been built in China.
Neither Chinese nor Cambodian authorities nor China Huaneng appear to have conducted meaningful assessments of the project’s benefits versus impacts prior to construction. China Huaneng has repeatedly claimed the dam can produce 1,998-gigawatt-hours per year, about one-sixth of Cambodia’s entire annual electricity production. The dam’s actual production, however, is likely less than half of that, based on reported estimates of the project’s tax revenue.
ALLEGED ENVIRONMENTAL PREJUDICE
Numerous academic studies have shown that emissions from decomposing vegetative matter submerged by dam reservoirs often rival the production of greenhouse gasses by ordinary fossil fuel power plants. A 2017 study estimates that the project has a carbon dioxide emission rate per megawatt-hour comparable to some natural gas plants.
Similarly, a 2008 Environmental Impact Assessment (EIA) commissioned by EVN, one of the project partners, pointed to large numbers of people displaced to areas with inferior farmland, together with serious and permanent effects on their fishing and farming incomes, major negative effects on the livelihoods of other fishing communities upstream and downstream, and losses to other areas toward the Vietnam border and downstream toward the Mekong, with an estimated 300,000 people indirectly impacted.
A study published by the National Academy of Sciences in the United States in 2012 predicted that the project would heavily impact the fish population on the entire Mekong River system, with an almost 10 percent loss in fish biomass basin-wide in the Lower Sesan 2 project alone. The authors noted that the construction of other dams on the Mekong system, many of which have subsequently been built, would aggravate the problem.
CONCLUSIONS
Over the past three decades, the Cambodian government and military have been engaged in illegal and coerced land takings and forced displacement of communities often carried out with threats, intimidation, and violence. In this line, in the early 2000s, the government adopted laws and policies to make the country more attractive to investors, including tax cuts and preferential regulatory treatment, including the advent of economic land concessions (ELCs), which are generous long-term leases of state-owned land plots of up to 10,000 hectares.
From 2003, land concessions across the country reached over 2.1 million hectares of land, involving the displacement of over 400,000 people. The Cambodian League for the Promotion and Defense of Human Rights (LICADHO) has documented hundreds of cases of land seizures backed by government forces, typically involving threats, use of force, lack of due process, and resettlement schemes leaving displaced persons worse off than before. Indeed, last June, protesters were shot in Kandal province while they demanded their land after the Kandal provincial government issued a letter the previous Thursday declaring all the land was state land.
In 2014, The Cambodia Daily published an investigation that found that Cambodia’s Royal Group, which is headed by the Australian-educated businessman Kith Meng, reaped huge profits from the felling and sale of timber from the dam’s 36,000-hectare reservoir while the dam was under construction. According to the report, the Royal Group had “carte blanche to fell and sell timber inside the reservoir area”.
Apart from other impacts triggered by Cambodia’s largely unregulated system of land concessions, its basic physical environment has also been damaged. Satellite images from the NASA Earth Observatory released in 2017 showed that between 2001 and 2014, Cambodia lost 1.44 million hectares of forest, one of the highest deforestation rates in the world.
Both the Cambodian and the Chinese governments are responsible for the impacts of the Lower Sesan 2 project in the environment and the affected communities since environmental harm, forced displacement, and intimidation and violence against villagers are the result of a settled pattern of land seizure in Cambodia, this time practised in order to perform a project funded by the Chinese government. There appears to be no interest nor commitment to impose adequate standards and balance environmental sustainability, communities’ human rights and economic development.
Since the issuance of the UN Guiding Principles, many pieces of literatures on corporate social responsibility have been written and international treaties, human rights guidelines and covenants have been put in place to set forth corporate and state liability for breach of environmental and human rights international standards in general and in different sectors, whereas advocating for transparency, dialogue and proper redress.
However, the multiple and continuous breaches committed by the Cambodian and the Chinese governments proves the era when states and companies could silence communities and impose their interests over thousands of people is not over. Indeed, the construction of The Lower Sesan 2 Dam makes evident that such practices may lead to the result desired by companies and states, disregarding the voice of the people affected and causing irreversible harm to them and to the environment. Political will, corporate social responsibility, and victim redress is not an option anywhere.
Another six hydropower dams are planned in Cambodia in the scope of the BRI.
Gabriela was born in Havana, but has lived in Madrid for the last 10 years. She studied Law in Spain, undertook a master's in International Relations and Economic Analysis, and recently completed a master's in Law. Her research interests include Business & Human Rights, Economics, Human Development and Policy in Europe, Asia and Africa.