Identifier
Created
Classification
Origin
07VIENTIANE133
2007-02-16 10:15:00
UNCLASSIFIED
Embassy Vientiane
Cable title:  

LAOS INSTITUTES "SLOWDOWN" FOR NEW MINING APPROVALS

Tags:  ECON EINV EMIN KIDE LA 
pdf how-to read a cable
VZCZCXRO9929
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHVN #0133 0471015
ZNR UUUUU ZZH
R 161015Z FEB 07
FM AMEMBASSY VIENTIANE
TO RUEHC/SECSTATE WASHDC 0897
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHBY/AMEMBASSY CANBERRA 0974
RUCPDOC/DEPT OF COMMERCE WASHDC
UNCLAS VIENTIANE 000133 

SIPDIS

SIPDIS

STATE FOR EAP/MLS ED BESTIC
STATE PASS USTR FOR DAVID BISBEE
COMMERCE FOR HONG PHONG PHO

E.O. 12958: N/A
TAGS: ECON EINV EMIN KIDE LA
SUBJECT: LAOS INSTITUTES "SLOWDOWN" FOR NEW MINING APPROVALS


UNCLAS VIENTIANE 000133

SIPDIS

SIPDIS

STATE FOR EAP/MLS ED BESTIC
STATE PASS USTR FOR DAVID BISBEE
COMMERCE FOR HONG PHONG PHO

E.O. 12958: N/A
TAGS: ECON EINV EMIN KIDE LA
SUBJECT: LAOS INSTITUTES "SLOWDOWN" FOR NEW MINING APPROVALS



1. In a press conference Friday February 16 the
vice-president of the Committee for Planning and Investment
(CPI),Mr. Bounthavy Sisouphantong, announced a "slowdown" in
the approval of new mining concessions. He also indicated
the Government of Laos (GOL) would be developing new
technical guidelines for the mining sector, and work to
improve monitoring of mining projects already implemented.
He emphasized the government remains committed to foreign
investment, and that the slowdown was not indicating a desire
for less investment, but in response to the reality that the
GOL does not have the human resources to deal with the crush
of mining agreements already signed and those that continue
to be submitted for approval. He specifically noted the need
for the GOL to examine the environmental and social impacts
of mining concessions, indicated a need for greater central
government control of the sector, and acknowledged the
importance of mining to the Lao economy.


2. Mr.Sisouphantong, flanked by CPI and Mining staff, was at
pains to clarify that existing signed contracts would not be
affected by the slowdown. In response to questions from
members of the mining community, he also clarified there was
no moratorium on new concessions, as rumored in Vientiane
over the past week, but that applications would be reviewed
in much more detail and potential investors would have to
wait while CPI and the GOL develop new technical regulations
to monitor mining concessions. A World Bank employee noted
the slowdown was something the World Bank had long suggested.
Due to a lack of trained geologists, and skilled labor in
general, those responsible for reviewing mining concessions
were being overwhelmed and were not able to properly consider
the environmental and social impact of the slew of new mines.
Oxiana, a major investor in the Lao mining sector, offered
assistance to the government as it develops its new
guidelines.


3. Comment: Taken at face value, the slowdown makes a
certain amount of sense. The GOL does not have many
qualified people capable of doing the necessary due diligence
on the numerous mining projects already approved, let alone
new proposals. Many concessions have been granted to Chinese
firms not known for their environmental or social concern.
(Note: We know of no U.S. mining firms operating in Laos.
The Australians, Chinese, and Vietnamese are the major
players. End note.) While Laos should exploit its mineral
wealth to assist in its development, doing so in a manner
that takes the environment into concern is something the
local donor community, and Post, have long advocated.
Although the mining community was clearly not excited by the
change, it might actually be in the best interests of the
people of Laos.
HASLACH