Fast Finance and the Political Economy of Catastrophic Dam Collapse in Lao PDR: The Case of Xe Pian-Xe Namnoy

Author:

Souvannaseng Pon1

Affiliation:

1. t Bentley University

Abstract

In the dark of a July night in 2018, a 5-billion-cubic-metre torrent of muddy water crashed through rooftops and ripped through the downstream villages of southeast Lao People's Democratic Republic (Lao PDR). An auxiliary "saddle" dam had collapsed in the US$1.02 billion Xe Pian-Xe Namnoy (XPXN) Hydropower Project that was still under construction and had just reached financial contractual close five years prior, in 2013. In the aftermath of the collapse, official state narratives pointed to extreme weather conditions and "unforeseen" construction and engineering miscalculations, viewing soil conditions as the primary culprit. This paper examines the financial dimensions of dam failure and introduces the term "fast finance": financier-driven timelines that have drastically expedited and shortened the legal, social, and pre-construction processes involved in hydropower dam projects to the detriment of dam safety, due diligence, and local participatory input. Extreme weather and anthropogenic climate change are not sole explanatory factors in the XPXN dam disaster. This paper highlights the also significant role of financial and political interests as contributing factors in dam safety and failure alongside extreme weather. The paper challenges conventional "natural disaster" framing of dam collapse by bringing into focus ex-ante political decision-making, financial engineering, and construction planning prior to dam construction to highlight the ways in which the XPXN catastrophe also had anthropogenic and "unnatural" contributing factors. Fast finance encompasses the role of temporality and the responsibility of state-business actors in ex-ante financial and infrastructure decisions that conclude with catastrophic outcomes. The article examines the re-engineering of contemporary dam finance through a case study of Lao PDR and argues that issues of financial engineering should be examined alongside other forms of civil, mechanical, structural, and hydrological engineering in the analysis of dam disasters. The temporal logics of financial actors—particularly the financialized logic of fast finance—has displaced the public-good-producing logic of patient capital. Financial logics shape and condition other forms of engineering and construction and are central to considerations of dam safety and accountability. Naturalizing discourses around extreme weather and aging dams deflect from the financial decisions and policy action, or inaction, of state-business actors to prevent dam collapse.

Publisher

Pacific Affairs

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