VZCZCXRO5358
RR RUEHCHI RUEHDT RUEHHM
DE RUEHHI #0129/01 0230755
ZNR UUUUU ZZH
R 230755Z JAN 07
FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC 4373
INFO RUEHHM/AMCONSUL HO CHI MINH 2415
RUEHZS/ASEAN REGIONAL FORUM COLLECTIVE

UNCLAS SECTION 01 OF 02 HANOI 000129 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/MLS, DRL/AWH 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM KIRF ENRG ECON VM
SUBJECT: NORTHWEST DAM PROJECT "ON TRACK," WITH SOME FINE TUNING OF 
RESETTLEMENT PLAN 
 
REF: 06 HANOI 739 
 
HANOI 00000129  001.2 OF 002 
 
 
Summary 
------- 
 
¶1. (SBU) According to local media reports and Post contacts, the Son 
La Province hydropower dam project is on schedule, together with the 
resettlement of the 100,000 ethnic minorities whose villages are 
located behind the dam.  The GVN denies that some resettled 
villagers have returned home, asserting instead (perhaps 
over-optimistically) that it has improved the resettlement program 
and will meet its goal of resettling all concerned by 2010.  End 
Summary. 
 
Project Facts 
------------- 
 
¶2. (SBU) On January 9, Vietnamese media reported that the Son La 
Province dam project, in Vietnam's Northwest Highlands, is 
"currently on track to be completed as scheduled."  This 
announcement was based on a report done by the project's Prime 
Minister-led Steering Committee, which concluded that the project is 
"slightly delayed," but "can still stay essentially on schedule." 
The Son La project officially began on December 2, 2005, with a 
total investment capital of VND 38 trillion VND (USD 2.4 billion), 
with VND 28 trillion (USD 1.8 billion) for construction and 
equipment installation and the remaining VND ten trillion (USD 628 
Million) committed to paying for the resettlement of the over 
100,000 people living in the valley behind the dam.  Half of the 
resettlement fund comes from State-owned enterprise Electricity 
Vietnam's (EVN) budget and the other half comes from the GVN. 
According to contacts familiar with the project, the GVN hopes that 
its half of the resettlement budget will have the additional benefit 
of boosting the economy of the impoverished region, particularly Son 
La, Lai Chau and Dien Bien provinces. 
 
¶3. (SBU) The Son La hydropower project is divided into three 
sub-projects:  the Ministry of Industry is responsible for the 
construction of the plant and equipment installation; the Ministry 
of Transportation is overseeing the construction of roads in the 
resettlement areas; and, the Ministry of Agriculture and Rural 
Development (MARD) is in charge of the resettlement of people 
displaced by the project.  In 2004, the GVN determined that 18,897 
households living behind the dam needed to be resettled.  (Note: 
Our contacts report that the actual number is 19,669 households, 
with 12,247 households in Son La Province, 3,350 in Lai Chau 
Province, and 3,840 in Dien Bien Province.  Some 94 percent of those 
households being displaced in Son La, Dien Bien and Lai Chau are 
ethnic minority households, mostly White Thai.  End Note.) 
 
Fine Tuning the Resettlement Plans 
---------------------------------- 
 
¶4. (SBU) Two pilot resettlement projects were carried out from the 
end of 2001 to the beginning of 2004 in Tan Lap District, Son La 
Province, and in Sipanhin District, Dien Bien Province.  Nguyen Van 
Dzu, who oversees MARD's Office of Resettlement for the Son La 
project, told us that the GVN drew "many valuable lessons from these 
two pilot resettlements."  For example, the GVN now no longer 
chooses resettlement sites for people or builds houses for them. 
Instead, those slated for resettlement now can choose where they 
want to live, and the GVN puts together a detailed plan for the new 
village and gives the villagers money to build their own houses. 
While the pilot programs were underway, the GVN also worked to 
prepare the new villages' infrastructure, including construction of 
roads, water pumping stations and house foundations.  Resettlement 
finally began in earnest in 2005. 
 
Obstacles to Resettlement 
------------------------- 
 
¶5. (SBU) In addition to logistical hurdles such as preparing and 
planning land for cultivation, irrigation and electrical 
distribution, "the most difficult work has been to convince people 
to resettle in new places," Dzu acknowledged.  Asked about reports 
that some villagers had returned to their previous residences after 
some months at the resettlement site, Dzu responded that the media 
reports were inaccurate.  "These people did not return to live but 
rather to continue to use the land there," he said.  "There is 
nothing wrong with their new homes."  In fact, Dzu boasted, some 
people who had disagreed with, or demonstrated against, the 
resettlement scheme have now become pioneers in carrying out the 
resettlement work.  (Note:  Son La provincial authorities have 
ignored our repeated requests for more information about these 
reports.  End Note.) 
 
¶6. (SBU) To date, 3,762 households have been resettled as of 
December 31, 2006, with an additional 7,182 households scheduled to 
 
HANOI 00000129  002.2 OF 002 
 
 
be moved.  The GVN is on track to complete resettlement by the 
planned 2010 date, Dzu said. 
 
¶7. (SBU) Vu Thi Tam Dzan of Electricity Vietnam's Son La project 
also described for PolOff additional ways in which the GVN has tried 
to adjust the resettlement program based on lessons learned in the 
pilot project.  MARD has set up a special fund in which resettled 
households have an allotment of VND 500 million (USD 31,000) each, 
but which cannot be tapped all at once.  In addition, the GVN will 
pay to actually transport a family's home rather than build a new 
one (if so desired), while local People's Committees have been 
provided funds to build home foundations, she added. 
 
Comment 
------- 
 
¶8. (SBU) As noted in reftel, the Son La project's resettlement of 
ethnic minority villages is proving hugely disruptive of traditional 
societies in the Northwest Highlands.  Despite official optimism 
that the resettlement program is now popular and on track, given the 
problems we observed in March 2006, reports of continuing problems 
-- such as resettled villagers returning home -- cannot be 
discounted.  End Comment. 
 
MARINE