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SOCIAL IMPACT ASSESSMENT FINAL_18 February 2008

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Khammouane Rural Livelihoods Project (KRLP) page 1

Prepared by the KRLP Provincial Coordination Section Social Impact Assessment (SIA) Department of Planning and Investment FINAL_18 February 2008 Khammouane Provincial Government

Abbreviations

FGD Focused Group Discussion KRLP Khammouane Rural Livelihood Project Lao PDR Lao People’s Democratic Republic NGO Non-government Organization PAFO Provincial Agriculture and Fisheries Office PAP Project Affected Person PSTEO Provincial Science and Technology, Environment Office RAP Resettlement Action Plan SES Socio-economic Survey SIA Social Impact Assessment WUG Water Users Group



Table of Contents

Page

Abbreviations

Table of Contents

1. Background of the Social Impact Assessment 4

2. Scope and Objectives of the Social Impact Assessment 4

2.1. Socioeconomic Survey 4

2.2. Focused Group Discussion 5

2.3. Survey Procedure 5

2.4. Unstructured Interviews and Consultations 5

2.5. Limitations of the Survey 5

3. Summary Findings of the Socioeconomic Survey of Target Villages 6

3.1. Gnomalath District 6

• Income Distribution 6

• Expenditure 7

• Housing 9

• Productive Use of Vacant Space 9

3.2. Bhoulapha District 9


• Expenditure 11

• Housing 12


3.3. Mahaxay District 13


• Expenditure 15

• Housing 16


4. Social Impact Assessment 17

4.1. Assessment of Need 18

4.1.1. Village Priorities 18

4.2. Absorptive Capacity 20



4.3. Potential Adverse Impacts 20

5. Findings and Conclusions: Expected Impact on Poverty 21

5.1. Introduction 21

5.2. Provision of Basic Services 21

5.2.1. Provision of Access Road 21

5.2.1.1. Impact on Health 21

5.2.1.2. Impact on Education 22

5.2.1.3. Impact on Gender 22

5.2.1.4. Impact on Income 22

5.2.2. Provision of Potable Water Supply 22

5.2.3. Provision and Construction of Basic Social Facilities 23

5.2.4. Access to microfinance and alternative source of livelihood 23

5.3. Institutional Development and Strengthening 23

5.3.1. Capacity Building 23

5.3.2. Community Empowerment 23



KHAMMOUANE RURAL LIVELIHOOD PROJECT (KRLP)

1. BACKGROUND OF THE SOCIAL IMPACT ASSESSMENT

The Social Impact Assessment (SIA) was undertaken to review and understand the social implications and degree of stakeholders’ participation in the project. It focuses on data related to social, economic and political structures in the selected target villages where the project is proposed to be implemented with the different types of construction, rehabilitation, extraction of materials and other works associated with project components, including capacity building and linking with various stakeholders. The main objectives of the SIA are the following;

• Identify social development issues and project benefits. Identify needs and absorptive capacity of the community and assess possible KRLP project benefits to reach the targeted villages/communities.

• Analyze existing institutional and participatory framework. This will serve to

describe how the process will be carried out in the different institutional levels from the Province, districts, target villages/communities and NGOs.

• Identification of possible negative social impact of the project. This SIA

identified and evaluated possible negative social impact of the project in the community and proposed mitigation plans to compensate affected persons/households.

2. SCOPE AND OBJECTIVES

2.1. Socioeconomic Survey

The KRLP survey intended to gather quantitative socioeconomic data about the target eight (8) villages of the three (3) Districts in Khammouanne Province, namely: Gnomalath District; Bhoulapha; and Mahaxay districts. Through the survey, baseline data regarding the socio-economic status of these villages, their priority needs and concerns in relation to improving their quality of life will be established. The survey is intended to provide guidelines in the design of subprojects that would effectively address the needs of these villages, contribute to a reduction in the levels of poverty, assist in the monitoring and evaluation of subprojects and identify appropriate and viable schemes for implementation. The questionnaire that was prepared by KRLP is attached as Annex A. Focused group discussions (FGD) were also conducted to supplement findings from the survey. A translator was hired to assist in the actual conduct of the survey while representatives from PAFO and PSTEO were also present during the interviews and FGDs. As much as possible the sample size for the survey was 10% of the total household population of each village. The tight timetable, however, and the language barrier



should be considered as limitations of the survey. For this reason, observation walk, key informant interviews and the FGDs were meant to complement the survey results by way of supplementation and even validation. Annexes B, C and D show the result of the Socio-economic Survey (SES) for the three districts.

2.2. Focused Group Discussions (FGD)

In order to gain a better understanding of the villages with respect to their patterns of behaviour, the constraints they face in their respective communities in order to improve their quality of life, and determining their priority needs, focused group discussions were held. The participants were comprised of males and females representing different households in each village. The FGD was attended by majority of the heads of households in the village. The FGD likewise focused on elucidating the needs of the villagers with respect to the condition and access to basic services, livelihood opportunities and other aspirations of the community.

2.3. Survey Procedure

Prior to the actual survey and FGDs, it was necessary to observe protocol and confer with the three (3) layers of governmental structure from the provincial level down to the village level. Permission had to be secured from the District authority. The latter arranged meetings for the KRLP team with the village leaders for the schedule and objective of the survey.

Once this protocol was observed, it was, thus possible to commence the actual surveys and FGDs which began in the 1st week of December 2007 and ended 3rd week of December 2007.

2.4. Unstructured Interviews and Consultations

The KRLP Team was called upon to explain the purpose of the survey from time to time. There was also considerable information sharing with the village officials and informal consultations with the communities. These informal consultations enabled the team to develop qualitative insights into issues and concerns of the villagers.

2.5. Limitations of the survey

Given the small sample size and the rapid design of the research, the data and findings from this report cannot be generalized to a larger population or be considered conclusive. It should be noted however, given the objectives of the survey, that the sampling was drawn purposively among those considered as target beneficiaries in



Freq. % Freq. % Freq. % Freq. %10,000 to 100,000 0 0.0 0 0.0 3 17.6 0 0.0100,001 to 200,000 2 16.7 0 0.0 3 17.6 1 6.7200,001 to 300,000 0 0.0 0 0.0 1 5.9 2 13.3300,001 to 400,000 0 0.0 0 0.0 1 5.9 1 6.7400,001 to 500,000 2 16.7 0 0.0 0 0.0 2 13.3500,001 to 600,000 0 0.0 1 12.5 1 5.9 1 6.7600,001 to 700,000 3 25.0 0 0.0 0 0.0 0 0.0700,001 to 800,000 0 0.0 0 0.0 1 5.9 1 6.7800,001 to 900,000 2 16.7 2 25.0 0 0.0 0 0.0900,001 and above 3 25.0 5 62.5 7 41.2 7 46.7

Total 12 100.0 8 100.0 17 100.0 15 100.0

Income Distribution of Household Head by Village

Income RangeLAO NALAKWAY SANKIAW THAT

each village. The intent was to get information on the socioeconomic characteristics of target beneficiaries as represented by a small number of households in each village in order to make a rapid assessment of possible project impacts, whether positive or negative. This exercise provides stylized facts about the target beneficiaries or what could be called as indicative characteristics. Nevertheless, the actual respondents were drawn at random among the target beneficiaries. For these reasons, the FGDs, observation walk and key informant interviews, among others, supplement the information generated from the survey. In some instances, these methods validate key findings.

3. Summary Findings of the Socioeconomic Survey of Target Villages

3.1. Gnomalath District –

• INCOME DISTRIBUTION

Among the four villages in Gnomalath, the one with the least income gap was the village of Nalakway. More than 60 percent of household respondents earn between 900,001 Kip above, while 25 percent generate income between 800,001 and 900 thousand Kip. In Lao, 1 out of 4 households surveyed belong to the income range of 600,001 to 700 thousand Kip, while the same proportion earns 900,001 Kip and above. In Sankiaw, a little less than the majority belonged to the highest income range, while 35 percent of respondents earn between 10 thousand to 200 thousand Kip. Surveyed households in That were distributed income-wise as follows, about 47 percent earn 900,001 and above, 13 percent belonged to the 400,001 to 500 thousand Kip range and the same proportion receive between 200,001 to 300 thousand Kip.

In terms of value of income earned, the households in Nalakway had the highest average income at 1.2 million Kip, followed by the respondents surveyed in Sankiaw with a little over a million Kip. Households in Lao earn an average income of almost 800,000 Kip, while for those from That, the average posted was 953,333 Kip.



MONTHLY AVERAGE HOUSEHOLD INCOME BY VILLAGE (Kip)

Village Respondents Ave. Income

LAO 12 785,833NALAKWAY 8 1,262,500SANKIAW 17 1,082,353THAT 15 953,333

The same trend as above is observed as far as per capita income goes as household members in Nalakway get an average of a little less than 300 thousand Kip, followed by those in Sankiaw who earned about 172 thousand Kip. Lao village had per capita average income of 160 thousand Kip, while in That village, each household member earns an average of 140 thousand Kip. MONTHLY AVERAGE PER CAPITA INCOME BY VILLAGE (Kip)

Village Respondents Ave. Per Capita Income

LAO 12 143,839NALAKWAY 8 297,143SANKIAW 17 172,081THAT 15 160,093

• EXPENDITURE

In Lao village, average household expenditures for 41 percent of those households surveyed ranged between 10 thousand to 200 thousand Kip. Fifty percent of those residing in Nalakway spent the most at 900 thousand and above, while those in Sankiaw were lumped between 10 thousand to 300 thousand Kip with about 24 percent spending on the high average of 900 thousand and above. Average household expenditures in the village of That were more varied with 20 percent spending between 500,001 and 600 thousand.



Frequency Percentage Frequency Percentage Frequency Percentage Frequency Percentage10,000 to 100,000 2 16.7 0 0 2 11.8 0 0.0100,001 to 200,000 3 25.0 0 0 2 11.8 2 13.3200,001 to 300,000 1 8.3 0 0 4 23.5 1 6.7300,001 to 400,000 0 0.0 1 12.5 1 5.9 2 13.3400,001 to 500,000 2 16.7 0 0 2 11.8 2 13.3500,001 to 600,000 1 8.3 2 25 1 5.9 3 20.0600,001 to 700,000 0 0.0 0 0 1 5.9 2 13.3700,001 to 800,000 1 8.3 1 12.5 0 0.0 0 0.0800,001 to 900,000 0 0.0 0 0 0 0.0 1 6.7900,001 and above 2 16.7 4 50 4 23.5 2 13.3Total 12 100.0 8 100 17 100.0 15 100.0

Expnditure DistributionLAO NALAKWAY SANKIAW THAT

In terms of the categories of expenditures where more Kips are allocated, the household respondents in Lao regard food, transportation, remittances, and mobile telephony expenses as priority while Nalakway households spend more on food, transportation, miscellaneous, and education. On the other hand, Sankiaw household respondents prioritized food, transportation and education. Household respondents in That spent a lot on food averaging at more than 300 thousand Kip but followed by payments for loans, then on education and transportation.

Monthly Average HH expenses by major categories and by village.

Major Categories LAO NALAKWAY SANKIAW THAT

Total HH Expenditure 517,401 943,363 644,539 536,313

Food 261,250 625,000 278,667 333,333

Electricity 11,800 . 58,571 14,385

Cooking Fuel . . . .

Transportation 186,500 187,143 157,500 64,545

Water . . . .

Education 30,667 125,000 149,556 68,143

Health 23,125 16,143 50,833 26,200

Mobile 50,000. 58,333 23,750

Leisure/Social . . 50,000 .

Clothing 26,591 30,000 65,357 29,267

Religion 5,682 9,188 9,438 5,827

Government 16,029 3,800 4,323 6,347

Remittances 55,000 . 7,500 10,000



Solid Waste . . . .

Installment Payment for purchased goods/appliances 36,250 . 10,500 14,000

Payment of Loans . . 100,000 150,000

Misc (soap, cigarettes, liquour, etc) 11,100 176,667 21,533 15,092

• HOUSING

The two most typical construction materials used in all villages for their outer walls were wood/plywood and bamboo/cogon/nipa. For the roofs, the most common were galvanized iron/aluminum, again in all villages. One household respondent each in Sankiaw and That still utilizes makeshift/salvaged material. As for the roof, most of the respondents in all the regions claimed that they have used galvanized iron and aluminum.

• PRODUCTIVE USE OF VACANT SPACE

Except for Nalakway, all of the study villages claimed to have spaces around their jurisdictions for various purposes like garden, livelihood activities and others. Two household respondents from Nalakway indicated that they do not have space for said pursuits. Respondent households that have open spaces in Lao set them aside for use in livestock, while those from Nalakway utilizes the space equally for crops/vegetables and/or livestock. A few of the respondents in Sankiaw use the space as garage for vehicle, cart and animals but more so for crops/vegetables production. The same pattern is observable in That village except that there are more respondents using the space for crops/vegetables than for livestock.

3.2. Bhoulapha District

• INCOME DISTRIBUTION

As far as income would go, the distribution in the village of Houaytha had wide gaps among those surveyed. One out of 4 earns between 10 thousand to 100 thousand, while another 25 percent generates earnings within the range of 200,001 and 300 thousand. One other respondent brings home between 500,001 to 600 thousand, while the last one received the highest income of 900,001 and above. On the other hand, the village of Namchala was less dispersed when it comes to income, with half of those surveyed earning between 10 thousand 200 thousand. With the next income group close at the range of 200,001 to 300 thousand, a bit far ahead was 12 percent of households surveyed getting 400,001 to 500 thousand of income. Only 2 households were found in the highest income range of 900,001 and above.

Income Distribution of Household Head by Village

HOUAYTHA NAMCHALA

Income Range Frequency Percentage Frequency Percentage

10,000 to 100,000 1 25.0 2 25.0



100,001 to 200,000 0 0.0 2 25.0

200,001 to 300,000 1 25.0 1 12.5

300,001 to 400,000 0 0.0 0 0.0

400,001 to 500,000 0 0.0 1 12.5

500,001 to 600,000 1 25.0 0 0.0

600,001 to 700,000 0 0.0 0 0.0

700,001 to 800,000 0 0.0 0 0.0

800,001 to 900,000 0 0.0 0 0.0

900,001 and above 1 25.0 2 25.0

Total 4 100.0 8 100.0

Survey results indicate that the average household income in Houaytha/Whaitha was over 310,000 Kip, while households in Namchala earn less with an average of a little less than 200,000 Kip.

MONTHLY AVERAGE HOUSEHOLD INCOME BY VILLAGE (Kip)


HOUAYTHA 3 316,667NAMCHALA 6 199,167

Deriving per capita income denotes the average income earned by each household member in the village, which was a little over 90,000 Kip in Houaytha/Whaitha and over 26,000 Kip in Namchala. MONTHLY AVERAGE PER CAPITA INCOME BY VILLAGE (Kip)

Village Respondents Ave. Per Capita

Income

HOUAYTHA 3 91,667NAMCHALA 6 26,548



• EXPENDITURE

All of the households surveyed in the village of Houaytha spent between 10 thousand to 100 thousand Kip for their needs. In Namchala, 3 out 4 household respondents had the same expenditure pattern.

Distribution of Total Household Monthly Expenditure by Village

HOUAYTHA NAMCHALA

Expenditure Distribution Frequency Percentage Frequency Percentage

10,000 to 100,000 4 100 6 75

100,001 to 200,000 0 0 1 12.5

200,001 to 300,000 0 0 0 0

300,001 to 400,000 0 0 1 12.5

400,001 to 500,000 0 0 0 0

500,001 to 600,000 0 0 0 0

600,001 to 700,000 0 0 0 0

700,001 to 800,000 0 0 0 0

800,001 to 900,000 0 0 0 0

900,001 and above 0 0 0 0

Total 4 100 8 100

In terms of actual valuation of expenditures on the average, the category, which household respondents in Houaytha spend the most was food, followed by expenses related to health and then clothing. This appears typical as these conform to the three most basic needs of man. Meanwhile, households in Namchala among those surveyed spend the most for food, then for transportation, followed by remittances, health and clothing. This pattern reflects that households in Namchala had an entirely different set of priority expenditures based on the condition and circumstances they are facing.


Major Categories HOUAYTHA NAMCHALA

Total HH Expenditure 61,125 95,687

Food 25,000 56,333

Electricity . 2,000

Cooking Fuel . .

Transportation 7,500 24,000

Water . .



Education . 7,086

Health 20,667 12,214

Mobile . .

Leisure/Social . .

Clothing 11,667 10,611

Religion 1,000 .

Government 1,750 3,104

Remittances 1,000 15,500

Solid Waste . .

Installment Payment for purchased goods/appliances 1,500 5,567

Payment of Loans . .

Misc (soap, cigarettes, liquour, etc) 4,333 11,743

• HOUSING

AVERAGE FLOOR AREA OF THE HOUSE (Sq. Meters)

Village Respondents Ave. floor area

of the house

HOUAYTHA 4 66.25NAMCHALA 8 62.57143

Average floor area of houses occupied in Houaytha/Whaitha was 66.25 square meters, while household respondents in Namchala had smaller areas at 62.6 square meters.

Type of construction material used in the outer walls

Houaytha Namchala Type of construction material

Freq. Percent Freq. Percent

Galvanized Iron/Aluminum 0 0 0 0

Tile/Concrete/Brick/Stone 0 0 0 0

Wood/Plywood 0 0 6 0.75

Mixed Tile/Concrete/Brick/Stone and wood/Plywood 0 0 0 0

Bamboo/Cogon/Nipa/Sawali 4 1 2 0.25

Makeshift/Salvaged Material 0 0 0 0

Other 0 0 0 0

Total 4 1 8 1



As to type of construction materials making up these housing structures, all of the respondents in Houaytha/Whaita claimed that their outer walls were made up of bamboo/cogon/nipa. In contrast, 75 percent of households in Namchala involved in the survey used wood and plywood for their outer walls. The roofs of the houses in Houaytha/Whaita were mostly made from galvanized iron/aluminum, with more than the majority in Namchala indicating that the same material can be found in their houses.

Type of construction material used on the roof

Houaytha Namchala Type of construction material


Galvanized Iron/Aluminum 3 75 5 62.5


Wood/Plywood 1 25 1 12.5


Bamboo/Cogon/Nipa/Sawali 0 0 2 25


Other 0 0 0 0

Total 4 100 8 100

• PRODUCTIVE USE OF VACANT SPACE

Expected in a rural setting, all of the respondents in Houaytha and Namchala confirmed that they have space for garden and livelihood activities in the proximity of their housing structures.

3.3. Mahaxay District

• INCOME

The 2 villages in Mahaxay had similar patterns of income distribution. In Cava/Kawa, half of total household respondents earn between 300,001 to 400 thousand Kip, while the same proportion in Phonelai belonged to the 100,001 to 200 thousand Kip range.

Monthly Income Distribution of Household Head by Village

CAVA or KAWA PHONELAI

Income Range Frequency Percentage Frequency Percentage

10,000 to 100,000 1 16.7 1 25.0

100,001 to 200,000 1 16.7 2 50.0

200,001 to 300,000 0 0.0 0 0.0



300,001 to 400,000 3 50.0 1 25.0

400,001 to 500,000 0 0.0 0 0.0

500,001 to 600,000 0 0.0 0 0.0

600,001 to 700,000 0 0.0 0 0.0

700,001 to 800,000 0 0.0 0 0.0

800,001 to 900,000 0 0.0 0 0.0

900,001 and above 1 16.7 0 0.0

Total 6 100.0 4 100.0

The average household income earned by household respondents in Cava/Kawa was 300 thousand Kip, while those in Phonelai gets a little less than 200 thousand Kip at 180 thousand. MONTHLY AVERAGE HOUSEHOLD INCOME BY VILLAGE (Kip)


CAVA or KAWA 5 300,000PHONELAI 4 180,000

As far as per capita income goes, household respondents in Cava/Kawa earn an average income of 50 thousand Kip. On the other hand, those surveyed in Phonelai bring home 31 thousand Kip average per capita income. AVERAGE PER CAPITA INCOME BY VILLAGE (Kip)

Village Respondents Ave. Per Capita

Income

CAVA or KAWA 5 50,000PHONELAI 4 31,000



• EXPENDITURE

In the village of Cava/Kawa in Mahaxay, 1 out of 3 household respondents spent between 10 thousand and 100 thousand Kip for their expenditures. Meanwhile, those on Phonelai tended to spend in the lower half of the expenditure ranges of 10 thousand and 400 thousand Kip.

CAVA or KAWA PHONELAI Expenditure Distribution Frequency Percentage Frequency Percentage

10,000 to 100,000 2 33.3 1 25

100,001 to 200,000 0 0.0 1 25

200,001 to 300,000 1 16.7 1 25

300,001 to 400,000 0 0.0 1 25

400,001 to 500,000 1 16.7 0 0

500,001 to 600,000 1 16.7 0 0

600,001 to 700,000 0 0.0 0 0

700,001 to 800,000 1 16.7 0 0

800,001 to 900,000 0 0.0 0 0

900,001 and above 0 0.0 0 0

Total 6 100.0 4 100

Household respondents in Cava/Kawa spent more on food, transportation, clothing, and miscellaneous expenditures while those in Phonelai prioritized food, transportation, payment of loans, and education.


Major Categories CAVA or KAWA PHONELAI

Total HH Expenditure 2,064,755 753,217

Food 550,000 174,000

Electricity 0 20,000

Cooking Fuel 0 0

Transportation 380,000 165,000

Water 0 0

Education 162,000 75,000

Health 112,000 42,000

Mobile 0 0

Leisure/Social 0 0

Clothing 275,000 65,000



Religion 26,500 16,000

Government 30,255 15,217

Remittances 190,000 12,000

Solid Waste 0 0

Installment Payment for purchased goods/appliances 119,000 15,000

Payment of Loans 0 100,000

Misc (soap, cigarettes, liquour, etc) 220,000 54,000

• HOUSING

The average floor area of the these houses was both lower than 100 square meters at 84 for Phonelai and almost 60 square meters for those located in Cava/Kawa. AVERAGE FLOOR AREA OF THE HOUSE (Sq. Meters)

Village Respondents Average Land

Occupied

CAVA or KAWA 6 59.66667

PHONELAI 4 84.25

For the outer walls, resident-respondents in Cava/Kawa utilized either bamboo/cogon/nipa or wood plywood. These same materials were also used by the households in Phonelai.

Type of construction material used in the outer walls

Cava or Kawa Phonelai Type of construction material Freq. Percent Freq. Percent

Galvanized Iron/Aluminum 0 0 0 0


Wood/Plywood 2 0.4 3 0.75


Bamboo/Cogon/Nipa/Sawali 3 0.6 1 0.25


Other 0 0 0 0

Total 5 1 4 1

The types of materials used were more varied when it comes to roofing materials. Sixty percent of respondents in Cava/Kawa used galvanized iron/aluminum, while 1 out of 5



utilized wood/plywood and even bamboo/cogon/nipa. Resident-respondents from Phonelia were equally distributed among galvanized iron/aluminum; wood/plywood, bamboo/cogon/nipa, and makeshift/salvaged materials.

Type of construction material used for the roof

Cava or Kawa

Phonelai Type of construction material


Galvanized Iron/Aluminum 3 60.0 1 25.0

Tile/Concrete/Brick/Stone 0 0.0 0 0.0

Wood/Plywood 1 20.0 1 25.0

Mixed Tile/Concrete/Brick/Stone and wood/Plywood 0 0.0 0 0.0

Bamboo/Cogon/Nipa/Sawali 1 20.0 1 25.0

Makeshift/Salvaged Material 1 0.0 1 25.0

Other 0 0.0 0 0.0

Total 6 100.0 4 100.0

• PRODUCTIVE USE OF AVAILABLE SPACE

Most of the respondents in Cava/Kawa admitted to have available spaces near their houses, with only 1 saying that their household had none. On the other hand, all those from Phonelai indeed had available spaces. As to their utilization, respondents from Cava/Kawa put these spaces to productive use by planting crops/vegetables and to rear livestock, while those from Phonelai make use of these vacant spaces for purposes of raising livestock, planting crops/vegetables and as garage for vehicle, cart and animals.

4. Social Impact Assessment

• The interventions being proposed in the target areas are expected to impact on the agricultural practices of the community. For instance, irrigation may lead to increased crop production, which would ultimately redound to increases in the income of farmers.

• Increased farm employment could occur given the probable upward trend in the productivity of agricultural lands. There would be more employment opportunities for farming families as well as for hired laborers in the locality, particularly among the relatives of farmers who assist in the farming.

• Access to water is empowering to a community that had only experienced scarcity in the past. With the increasing availability of water, utilization would have more variations such as for bathing, washing laundry and maintenance and cleaning of livestock. It would also then be possible to



create and sustain home gardens, i.e. vegetables patch or cut flower, either for personal consumption or as a possible additional source of income.

• Increasing incomes of farmers could lead to corresponding increases in their disposable income, which when used wisely would result in economic and social investments. The latter refers to improved attendance of children of farmers and farm laborers in school. This would also increase access of villagers to medical services to other nearby districts.

• The implementation of subprojects, particularly those involving construction of small infrastructure, could generate employment among the populace. This also has multiplier effects in terms of goods and services that may be produced to support these activities such as food kiosks, construction materials, board and lodging, etc. Additional earnings augment disposable income of families causing increases in consumption expenditures that would augur well for those providing goods and services in the communities.

4.1. Assessment of Needs

4.1.1. Village Priorities

• Bhoulapha District

Household respondents were asked to rank the services they need in their community according to priority. Villagers from Houaytha considered physical infrastructure such as those relating to farming and roads as topmost priority, while livelihood assistance and public health services were ranked second. On the other hand, the provision of schools in the area was regarded as third most priority. Similar types of needs were identified as priorities in Namchala. Roads and farming infrastructure were on top of the list, while livelihood assistance, public health services and schools were regarded as second priorities.

Priority social and Infrastructure services needed in the community

Village Houaytha Namchala

Services/Rank 1 2 3 1 2 3

Livelihood assistance 0 2 0 1 2 1

Farming infrastructure 2 0 0 2 0 1

Public Health services 0 2 0 0 2 3

Schools 0 0 4 0 2 1

Roads 2 0 0 3 1 1

Others 0 0 0 1 0 1

• Gnomalath District

In the district of Gnomalath, the four villages under its jurisdiction provided information as to how they rank the set of needs/services according to priority needs.



Lao village gives primordial importance to farming infrastructure, while those from Nalakway puts livelihood assistance as top priority. Sankiaw was almost unanimous in its ranking of needs towards farming infrastructure, while That villagers were partial to roads, farming infrastructure and schools.


Village Lao Nalakway Sankiaw That

Services/Rank 1 2 3 1 2 3 1 2 3 1 2 3

Livelihood assistance

3 2 2 4 3 1 2 10 1 0 2 7

Farming infrastructure

4 3 3 2 2 1 11 2 2 5 2 4

Public Health services

0 6 2 0 1 1 1 2 7 1 5 2

Schools 3 1 3 0 0 0 1 0 3 4 3 1

Roads 2 0 2 2 2 2 0 3 1 5 3 1

Others 0 0 0 0 0 3 2 0 3 0 0 0

• Mahaxay District

In Mahaxay, the same exercise yielded the result that villagers from Cava were a little bit diverse when it comes to identifying their topmost needs, but roads and farming infrastructure seemed to be indicative of their preference. For Phonelai, it is still farming infrastructure that garnered the most number of votes among those available.


Village Cava Phonelai

Services/Rank 1 2 3 1 2 3

Livelihood assistance 0 2 2 0 1 3

Farming infrastructure 2 1 0 3 1 0

Public Health services 1 1 1 0 0 0

Schools 0 2 2 1 2 1

Roads 2 0 1 0 0 0

Others 1 0 0 0 0 0



4.2. Absorptive Capacity

It is important that the capabilities of the target-villages to acquire and utilize effectively the services, benefits of the proposed subprojects are assessed. Thus, targeting the appropriate and viable subprojects which is more effective in the respective villagers must be identified. There is a clear motivation among the surveyed villages eminent during the FGDs that they are all willing to participate and co-operate in self-help activities. The participation of NGOs is perceived in extending social preparation, organizational development, access to credit and livelihood programs, which must be established due to non-experience of these villages in implementing and operating proposed subprojects. The community empowerment will seek to address this issue and concern.

4.3. Potential Adverse Impacts

It is possible that proposed subproject might result into a minor land or structures being affected due to right-of-way and expansion of existing infrastructure projects that needs to be rehabilitated, improved or constructed.

Under the Land Titling Project supported by the World Bank and AusAid, the aim was to issue land owners or holders with greater degree of security of tenure. The Land Titling Project issues the Land Survey Certificate and the Land Title. During the survey, most respondents indicated they held some form of registration, most claiming to hold a Land Certificate or a Land Title. Although there might be some misunderstanding about the name and importance of each document among villager-respondents, these two types of documents are essential as they represent village permission or agreement with land title claims. This is the basis upon which taxes are paid, which in turn, becomes a prerequisite for issuance of Land Survey Certificates and Land Titles. [M1]

Borne out in the survey results and the FGDs, the target-villagers are willing to sacrifice portions of their land in exchange for assistance and interventions for improvements in their communities.

The Social Safeguard Manual under KRLP provides an entitlement for compensation and allowances for all losses, if any. Under the safeguard policy, voluntary donation will not be applied for any assets except very minor losses of residential land. Voluntary donation of small strips of residential land will be according to the following criteria that will be strictly complied with, i.e., (i) the AP’s total residential land area is not less than 300 m2; (ii) if the AP’s total residential land area is more than 300 m2, the strip of land that can be donated cannot be more than 5% of the total land area; and (iii) there are no houses, structures or fixed assets on the affected portion of land.

The recent changes in the Government of Lao PDR legislation related to compensation and resettlement in development projects represent a significant improvement in the rights of citizens when their livelihoods, possessions and society, in general are affected. . Both Lao PDR Law and World Bank policies entitle PAPs to



compensation for affected land and non-land assets at replacement cost. However, definition of severely affected PAPs varies between World Bank (OP 4.12) at 10% and Decree 192/PM (Article 8) at 20% of income generating assets affected. However in accordance with Decree 192/PM (Article 6) which entitles all PAPs to economic rehabilitation assistance to ensure they are not worse off due to the Project, the 10% definition of severely affected will be adopted as part of the KRLP’s resettlement policy.

Another is that, both Lao Law and World Bank policies entitle non-tilted PAPs to compensation for affected assets at replacement cost and other assistance so that they are not made worse off due to the Project. Decree 192/PM goes beyond World Bank’s policy and provides PAPs living in rural or remote areas, or PAPs in urban areas who do not have proof of land-use rights and who have no other land in other places, compensation for loss of land-use rights at replacement cost, in addition to compensation for their other assets and other assistance. Should PAPs be found to be non-titled and required to relocate, the Project will ensure they are either provided with replacement land at no cost to the PAPs, or with cash sufficient to purchase replacement land.

5. Findings and Conclusions

Expected Impact on Poverty

5.1. Introduction

These findings on the possible impact on poverty conditions are based on the wider definition of poverty in Lao PDR and involving not only considerations of income, but the lack of security in agricultural land, environmental conditions, poor quality of life and social deprivation from basic and infrastructure/social services.

5.2. Provision of Basic Services

5.2.1. Provision of Access Road

Provision of access roads will provide and increase opportunities for mobility and all-weather access to homes, commercial, educational, health and social facilities. This will also result in increasing levels of income; increased levels of social interaction, which in turn will support the community empowerment/organization effort. Road access will also improve farm-to-market services of the farmers.

Identified Positive Impacts of Road Improvement in the villages, namely:

5.2.1.1 Health. Transporting of patients, particularly those who are in serious conditions can be conducted in a safer, faster and more comfortable manner. Villagers who live in an isolated area will have more access for visiting health centers, especially during the rainy season.



5.2.1.2 Education. Travel conditions to and from school by students would be improved. This would encourage children to regularly attend school and minimize incidences of drop-outs. Consequently, the general education levels of villagers will improve in the future.The project could also mean safer roads for children to walk and ride their bicycles to school.

5.2.1.3 Gender. Based on interviews and observations, women do most of the household chores or work in their community including transporting goods to market. With the construction or improvement of road conditions of some roads, there will be a direct impact on the women in terms of reduction in travel time. This could lead to improved standards of living as it is able to alleviate the burden of women’s various roles in the family in addition to their income generating activities ( particularly as farmers). In particular, there would be easier access to markets, water and food sources, firewood collection, would expand other opportunities to other possible income generating activities outside their villages due to increased mobility.

5.2.1.4 Income. Road improvement activities would involve construction that more likely would generate local employment in the target areas. This opportunity would reduce the unemployment rate, increase participation in the labor force and raise level of income in the villages. Increased income would lead to additional disposable income for consumption expenditures and other needs. This may trigger the mushrooming of small enterprises catering to the needs of these entrants to the labor force.

5.2.2. Provision of Potable Water Supply

Provision of water supply in the villages will reduce the risk of water borne diseases. In most cases, this would also reduce the time involved in fetching water by women and children which could lead to improved productivity of women and children in performing other household chores and even income generating activities.

To strengthen participation of stakeholders and communities to effect better cooperation and maintenance of water regulation and water distribution structures to minimize water wastage, the project must be supported by capacity building and training program/activities at the district, village and community levels, and including management committee leaders, with special emphasis on the participation of women. Training is to be provided in local planning, needs prioritization, subproject preparation and supervision, management of subprojects, and monitoring and evaluation. This would also establish the



institutional framework that will ensure integrated and sustainable water resources management.

5.2.3. Provision and Construction of Basic Social Facilities

The construction and rehabilitation of health and school facilities in the villages would require additional provision of manpower (teachers and health officers). The provision of facilities must be coordinated with the Department of Health and the Department of Education to ensure that the required manpower into the subproject will be committed.

5.2.4. Access to microfinance and alternative livelihood opportunities

The surveyed villages proposed provision and improvement of livestock to increase income of farmers.

In connection with this, the villagers need to be provided with a targeted credit and financial assistance program to support the farming needs of the community such as equipment and machineries. Such program may be along the lines of “Grameen Bank” type of soft-loan system in irrigation financing. Introduction to skills training (matched to skilled and semi-skilled job opportunities) and microfinance growth oriented enterprises as alternative sources of livelihood and various self-employment schemes in the villages are other possible interventions.

5.3. Institutional Development and Strengthening

5.3.1. Capacity Building

Improved planning and management of irrigation systems and other infrastructure services can be introduced in the community or village. Introduction of farming technology to support possible crop diversification through modern irrigation technologies that can be introduced by PAFO and NGOs may also be done. Other training programs for skills development for farmers and their households to expand livelihood opportunities could be undertaken.

Provision of technical assistance to Provincial government, District and Village authorities in the areas of development project management may also be a good complement to their current capacities.

5.3.2. Community Empowerment

The communities can be empowered through equal participation in key aspects of the project, if not all, and the establishment of village organizations, committees, production groups, and Water Users Group (WUG) in the villages for the maintenance and monitoring of the facilities and subprojects. Continuous consultations and participation in meetings would be encouraged from project planning, implementation and monitoring and



evaluation. These will focus on strengthening the village organizations to ensure that they have a voice in decision-making processes, particularly in setting priorities. NGOs can play a major role in the project by identifying subprojects, participating in community development planning, training, and provision of financial services to the community.

Community empowerment will also involve local capacity-building activities of the target villages on: (a) increasing awareness for community developement and organization; (b) identification and development of project proposals, (c) familiarization with the procurement processes for community works projects, and (d) supervision of microprojects, operations and maintenance of facilities, and identification of social and environmental issues.

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