The Asian Development Bank (the Bank) has studied with interest but also some concern the report Power Struggle: The Impacts of Hydro-Development in Laos, published by the International Rivers Network (IRN) in February 1999. The report is to be presented by Ms. Aviva Imhof on 8 May 1999 in California at the conference The Mekong River at Risk: The Impact of Development on the River, her Delta, and her People. Unfortunately it will take the Bank some time to prepare a proper response to such a substantial document. For the forthcoming public presentation, we would be grateful if IRN could make it known to the conference participants through this letter that the Bank will shortly place a detailed reply to the report on its web pages of both Nam Leuk Hydropower Project and Theun-Hinboun Hydropower Project.

At this time the Bank would like to make these comments:

• The Bank is happy to see that its own objectives of benefiting people in poor countries through sustainable use of ecosystems are the same as those of the IRN.
• The Bank believes that one of the most effective ways of achieving these objectives is through the responsible investment in poor countries of resources from rich countries at very low interest rates.
• Over the last 30 years the Bank has seen in Asia.
• Improvement in education, better distributions of opportunities between gender and ethnic groups, and higher levels of participation in governance along with general component in the economic condition.
• Those countries which have moved fastest in reducing rural poverty have been the most effective in conserving natural resources, in preserving unusual habitats and in protecting biodiversity.
• The most degraded landscapes, the most severe erosion, and the most threatened wildlife populations are found in the poorest countries, where Governments and people are focussed on subsistence survival issues.
• The Bank is therefore firmly convinced that sustainable conservation of resources and protection of habitats and populations are not possible without economic development.
• However, there is a fundamental difference between the Bank and IRN. Although both organizations have the same objective, the Bank believes that sustainable economic development is the precursor of effective conservation.
• IRN on the other hand appears to believe that conservation alone will improve people's lives.
• The Bank's hypothesis is being tested in the Asian region every day, and all the evidence suggests a positive correlation between effective conservation and economic development.
• No poor country has yet been able to find ways to undertake effective conservation, and many poor countries nevertheless have access to sufficient medical "know-how" to support very high demographic growth rates.
• Economic development in Lao PDR will inevitably involve development of the hydropower potential of some of its rivers.
• The Bank is keenly aware that hydropower developments have the potential to inflict serious negative social and environmental impacts on surrounding populations.
• The role of IRN in keeping the Bank "up to the mark" in following the Bank's social and environmental guidelines is definitely positive, and much appreciated by most professional engineers and environmental scientists.
• The Bank believes IRN could be even more effective in helping ensure hydropower projects are properly and responsibly selected and executed, if it were to inform itself better about the facts.
• To this end, the Bank is ready to assist IRN with clarifications, comments on drafts, access to documents and any other reasonable requests, in the belief that both organizations have something to offer in reducing poverty, improving quality of life, and conserving the planets dwindling resources and declining biodiversity.