Report gives national view of land concessions in Lao PDR

SDC | 29 January 2013

More than two-thirds of the population in Lao PDR relies on agriculture for their livelihoods. Many families depend on access to land, forest, and rivers for food security.

However, land use patterns in Lao PDR are rapidly changing. The agribusiness, mining, hydropower, and forestry subsectors are growing as a result of both domestic and foreign-direct investments. Between 2000 and 2009, the number of land deals in Lao PDR increased fifty-fold. While investments in natural resources-based sectors are expected to contribute to national economic growth, land concessions and leases for commercial operations may also adversely impact local communities’ livelihoods.

So far, a constructive debate on the costs, benefits, and sustainable alternatives to this shift has been hampered by a lack of accessible and comprehensive data. Now for the first time, a new report, Concessions and Leases in the Lao PDR – Taking Stock of Land Investments (2012), presents a national view of land concessions and leases, providing a valuable baseline for evidence-based policies and planning.

I discussed the report’s relevance and urgency with one of the authors, Dr. Andreas Heinimann, Senior Research Scientist at CDE:


photo by Remy Rossi

Marianne: The report concludes that 1.1 million hectares, that’s five percent of the country’s total territory, is currently under concession. That sounds like a lot?

Andreas: So I think the five percent, 1.1 million hectares or five percent of territory, is a figure, but I don’t think it’s an important figure. I think for me, one of the most relevant comparisons is the comparison with the rice production. Even though I knew it, I still find it striking: There is currently more land granted in concessions, than there is land being cultivated for rice. You can get people’s attention with that kind of number.

Marianne: When I read the report I noticed that the analysis does not take logging, contract farming, hydropower projects, or mining explorations into account. Why is that?

Andreas: It is a legal question. For hydropower, only the dam is a concession, a dam’s reservoir is legally not a concession. Contract farming is also not a concession; it is an individual farmer’s business contract. Logging does not require concessions, but rather quotas.

The reason we don’t include mining exploration concessions is a bit different. These are huge areas, but the actual impacts, if the exploitations ever happen, will be very small.

Marianne: This report gives the first-ever view of land concessions in Lao PDR on a national level. How has the Centre for Development and Environment (CDE) contributed to the report?

Andreas: We initiated it. We knew that GIZ had done this concession inventory, and we approached them and MoNRE and said – let’s do something with it. SDC’s contribution through the DECIDE Info project, was relatively small (130,000 CHF), but allowed us to add important value to the data that already existed.

Marianne: One of the unique things that the report offers is a spatial analysis – meaning, the analysis takes the geographical properties of the data into account. What are the strengths of spatial analysis?

Andreas: Spatial analysis – mapping – allows people to see the dimensions of the phenomenon on a national level. We’ve talked for years about land concessions, but we never had any real data. The data in the report is not perfect, but it is for sure the best available. I think that making data available is the most important result of the report.

Another thing is the analytic part, where you can overlay different sets of data to understand the bigger picture. For example, what is the relationship between concessions and poverty?

Marianne: It’s highlighted in the report that poverty incidence in areas where investment occurs is a lot lower than the national average (27 percent vs. 34.7 percent). What does that mean?

Andreas: Let me say first what it does not mean: It does not mean that the poverty is lower, because of the investment. No such correlation can be drawn from this analysis.

There are two reasons: The poverty incidence data is based on estimates made on the population and housing census 2005 (and LECS III), which is before the investments happened. So there can be no correlation. Secondly, even if it was new poverty data, one should never assume such correlation, because a correlation does not entail causality. The poverty analysis rather provides information on the context, in which the investments take place.

Instead, what it says is that, on average, investments occur in relatively better-off areas. This basically means that investments may not be a main tool for poor regions’ development approach. On a national level, they are. Investments contribute macro-economically to the development of Laos. But we have to balance the negative, local impacts versus the macro-economic benefits.

Marianne: What do you hope the findings in the report will be used for?

Andreas: The timing of the report is perfect. Currently the forestry law, the land law, the water law are under revision, and a land policy is under elaboration. Last year, the Prime Minister declared a moratorium on rubber, eucalyptus, and mining concessions, until further studies have been made.

This report is not a final result; it is a first step. I hope we can now initiate gathering more precise and better information. The time of science being an ivory tower – this has to stop. Our real world problems today are way too big that we can allow that kind of luxury. We need science at the interface between the knowledge production society and policy, addressing real life problems; this is very crucial.

Marianne: The report identifies a number of challenges for land management in Lao PDR, including lack of data, transparency, and coordination. Who will address these challenges going forward?

Andreas: I think they will be addressed. We have the support from the top-level of government, and there is department-level staff and division level staff, who know about these challenges, and who want to address them. The Prime Minister’s concession moratorium and its call for better data and information gives us the necessary legal background and the highest level of support. So I don’t see really, why it shouldn’t be done. It just has to be done, and we will have to see now, how we do it.


photo by Remy Rossi

Concessions and Leases in the Lao PDR – Taking Stock of Land Investments (2012) is a result of collaboration between SDC, CDE (Centre for Development and Environment, GIZ (German Cooperation), and the Ministry for Natural Resources and Environment.

SDC supported the collaboration with 130,000 CHF through the DECIDE Info project; a project that supports demand- and challenge-driven information development and dissemination for informed socioeconomic decision-making in Lao PDR. Learn more: www.decide.la.

Download the Full Report in English
Download the Executive Summary in Lao

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  • 29 Jan 2013

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