The Nation
January 18, 2001

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.