SCB's Response on Xayaburi Dam At Its 2014 Shareholders Meeting

Key Issues: 

April 3, 2014

Siam Commercial Bank (SCB) hosted its Annual General Meeting of Shareholders No. 191 at SCB head office in Bangkok to review previous year's financial status to its shareholders. During the meeting, the topic of Mekong mainstream dam, particularly the Xayaburi Dam, was raised by one of SCB shareholders. SCB is one of the 4 main investors of Xayaburi Dam.

This dialogue may be found on the Meeting minutes page 6.

Below are the questions/concerns posed by the shareholder:
1. Large amount of water released from upstream dams will cause severe impacts to downstream communities. Downstream water level would rise at least 3-5 meters every day. Consequently, serious floods would become more regular and sediment percentage would also change rapidly every day. It will be impossible for locals to maintain their agriculture, fish farming and fisheries business; all of which are what local people directly depend on.
The rapid flooding in Thai Mekong communities in December 2013 was a great evidence to illustrate the danger to downstream countries as the river became unpredictable. The impacts of Xayaburi Dam, located nearer to these communities, will be more immediate and more serious than the Chinese dams.
2. Xayaburi Dam’s fish passage is challenged immensely and questioned on its capacity by many MRC partners, including member governments, scientists and civil society. Yet, until now, there is no information of fish passage design and relevant scientific study including the redesigned fish passage plan available for public.
3. SCB has a very high reputation in Thailand for over a century. Why would SCB be willing to put its reputation at risk for such a controversial project?
4. How can SCB, as a major investor, be responsible for any future social and environmental impacts?
Anand Punyarachun authorized Dr. Vichit Surapongchai, Chairman of the Executive Committee, to answer the questions. His answers are as follow:
1. SCB is not an environment expert therefore we need to depend on the EIA provided by the project developer.
2. Governments of Vietnam and Cambodia have not protested this project seriously.
The shareholder continued to ask further:
1. If SCB knows that it is not an environmental expert then why did SCB only depend on the EIA provided by Ch Karnchang? Why didn’t SCB conduct more research on this project considering that the dam is a large-scale project and has raised many controversial issues since its proposal?
2. The opposition arising from Vietnamese and Cambodian Governments against Don Sahong Project caused Laos to suspend the project until now. This shows that regional political relationship is very strong and, at the end, Laos still needs to respect its neighboring countries' objections. What will SCB do if one day those Governments who opposed Laos' Don Sahong Project ask Laos to halt the operation of Xayaburi Dam?

Dr. Vichit Surapongchai answered:
1. Given that Thailand needs more energy and we do not have enough electricity, SCB considers hydropower is a clean energy and has less impacts than coal or nuclear power therefore we have to consider energy benefits for Thailand.
2. Please be assured that SCB has the capacity to handle any risk that is associated with the project, including not getting the credited loan back.
In the end, the answers by SCB board members may not be as detailed as the shareholder wished but at least a thousand shareholders became more aware of the project. This opportunity may pushed the boards members to get most updated information on the project.