402 



of water (an area of 230 square miles). Its power generation facili- 

 ties — power generators, transformer, and switchyard — will deliver 

 initially 30,000 kw and ultimately 120,000 kw over 115 kv transmission 

 lines to Vientiane and into Thailand. Laotian personnel are being 

 trained to operate the facility. 



Reasons for the assigning by the Coordination Committee of "first 

 priority" to this unit are complex but persuasive. It was to be located 

 in Laos, the least developed of the Riparian States. Political and dip- 

 lomatic relations were favorable. (For example, although its location 

 was in an area under at least partial control by the communist Pathet 

 Lao, the communists had permitted site surveys in 1964 and were 

 agreeable to the scheme.) It would be the first unit in the Mekong 

 Project to serve more than one country, which would dramatize the 

 international character of the entire enterprise. It was the largest 

 tributary project then in prospect. It offered a good cost/benefit ratio. 

 One of the most important considerations was that while large, the 

 project was still of manageable size for completion in a reasonably 

 short time; and once completed it would demonstrate tangibly the 

 opportunities offered by the Mekong Project as a whole. As the 1966 

 annual report of the Coordination Committee noted : "A very signifi- 

 cant feature of the Mekong Development Project's gross resources is 

 thus not only the very substantial increase in these during 1965-1966 

 [up from $6Y.9 million as of 31 December 1964 to $105.1 million a year 

 later, although only to $110 million by 31 December 1966 of which the 

 U.S. contribution was $26 million] but the increased proportion [64 

 percent] of total resources now being used for construction." 50 Charac- 

 teristically, this development was of interest to President Johnson who 

 in 1961 had expressed impatience over the protracted planning phase 

 and asked when the "dirt would begin to fly." It was also considered 

 important that almost one-third of the resources had been contributed 

 by the Riparian States themselves. 



A not wholly sympathetic account of the preliminary history of the 

 Nam Ngum Dam asserts that the United States negotiators had 

 "agreed to put up half of the money [for the dam] on the understand- 

 ing that Japan would, in turn, put up half the money for an equally 

 troublesome foundling in Cambodia: i.e., the Prek Thnot project, 

 whose paternity the United States had been willing to acknowledge 

 but Cambodia had denied." This account observes that Nam Ngum 

 constitutes "the first real test of the validity of the Mekong concept 

 that large-scale schemes in remote and backward regions will sustain 

 rather than strain newly developing social and economic systems." 51 



THE ASIAN DEVELOPMENT BANK 



Apparently there had long been a sentiment in favor of a regional 

 credit institution to specialize in the accumulation of capital resources 

 to support regional projects of ECAFE and its regional member states. 

 Apparently also this proposal was not favored by the White House or 

 the Department of State or Treasury, nor by the World Bank. Ob- 



60 Committee for the Coordination of Investigation of the Lower Mekong Basin, Annual 

 Report, 1966 I New York : United Nations, 1967), D 99 



81 Willard A. Hanna, "The Mekong Project," Part IV "The Test at Nam Ngum," Amer- 

 ican Universities Field Staff Reports, Southeast Asia Series xvl, no. 13 (July 1968), 4. 



