concerns over project authorization

Published on July 10, 2014

NA members raise concerns about development authorisations

Coordination mechanisms and procedures for project authorisation are a concern among National Assembly (NA) members who have cautioned that many authorised development projects have caused social, environmental and other negative impacts.

NA members questioned the Minister of Planning and Investment Mr Somdy Duangdy on the matter at the ongoing NA session, pointing out the Talat Sao Shopping Mall, Regal Megamall City and 450-Year Road projects as examples of cases where disputes have arisen.

In his response to the queries, the minister explained to the session about the procedures required, while admitting there were shortcomings in the coordination between the ministry, related bodies and local authorities.

According to Mr Somdy, all concession projects must be authorised by the relevant government agencies at the central level.

He said despite the fact the participation of local authorities was stipulated in the development agreement it doesn’t always work in practice.

The ministry provides the development documents and fees to the authorities, however in practice, project developers hardly recognise the authorities’ participation as genuine stakeholders.

“When problems occur the developers do not want to acknowledge the local authorities’ power where the project is located even though the development documents detail the rights of the local authorities,” the minister said.

In the dispute over the Talat Sao Mall, the traders concerned have refused to move from the old to the new building, claiming that the lease agreement for the space they are currently using is yet to expir e.

Regarding the Regal Megamall City, the project has gained little progress while the completion of the US$40 million project in Vientiane is scheduled for this year.

Meanwhile the construction of the 450-Year Road on the outskirts of Vientiane has created disputes regarding compensation for privately owned land.

The minister suggested that an official from each related sector should stand by with the ministry, working in coordination with the related sectors and local authorities on any proposed development projects.

Mr Somdy reminded NA members of the need to improve the existing regulations so that they are more comprehensive.

He also recognised that the government has created loopholes when signing deals in relation to some projects with developers in the past due to a lack of experience, which has led to impacts on local residents.

“We have to balance the benefits to all stakeholders, including the investors, the government, and local residents,’ he acknowledged.

The definition of the law regarding converting land to capital was another concern for NA members, who questioned whether the lack of precision in the definition was intended to create loopholes which have since led to the loss of state property.

Officials from many ministries and government bodies have benefited from the loophole which allows for the sale of state assets.

Source: Vientiane Times
Published on July 10, 2014