VIETNAM
Industrial Pollution Management Project (P113151)
Due Diligence of Involuntary Resettlement
Ong KeoIndustrial Zone (Dong Naiprovince)
April 2-3 2015
A. Project Objectives and Project Components
The development objective of the Vietnam Industrial Pollution Management Project (VIPMP) is to improve with industrial wastewater treatment regulations in four of the most industrialized provinces in Vietnam. The project's ultimate beneficiaries will be the general public in the four project provinces and beyond, who will benefit from reduced environmental pollution. The project will deliver direct benefits to: (a) MPI, by improving its capacity to promote sustainable industrial zone development; (b) MONRE, by improving its monitoring and enforcement capacity for industrial pollution management; and (c) the four project provinces, by strengthening their industrial development planning practices and their monitoring and enforcement capacity. IZDs in the four provinces will have access to concessional financing to construct Centralized Effluent Treatment Plant (CETP) and technical assistance to improve the design, operation and management of the CETPs.
The project consists of three components: (1) Component 1: Environmental Policy, Monitoring and Enforcement; Component 2: Performance-Based (CETP Financing; Component3: Implementation Support.
The PDO level results indicators are the extents of compliance with national regulations for effluent discharge from project-financed and non-project-financed industrial zones (IZs) in the four project provinces.
B. Objectives Of the Due Diligence Review
The Vietnam Environment Protection Fund (VEPF) received a proposal for the financing of the installation of Centralized Effluent Treatment Plant (CETP) for Ong Keo IZ (located in Dong Nai province) to improve the environmental pollution management for the IZ. Initial screening confirmed that the requested CETP is located inside the IZ whose land are as were acquired from local residents based on an Overall Compensation Plan approved by the Dong Nai Provincial People’s Community (PPC) in 2008. In addition, the screening noted that the compensation payment/support/resettlement activities (associated with the IZ area requiring DD) were fully completed at the submission of the CETP proposal. As VIPMP finances only IZs with an Overall Compensation Plan approved by the Provincial Authorities prior to the cut-off date of May 2010 and this IZ was approved prior to the cut-off date, this proposed CETP is eligible to be considered for VIPMP financing.
Following the Project’ Environmental and Social Management Framework (ESMF) dated in March 2015, VEPF has performed a due diligence (DD) of the land acquisition for the IZ and prepared this DDR under the guidance of the Bank. The March 2015 version of the ESMF specified that VEPF be responsible for the DD review and the preparation of a due diligence report (DDR) for CETP investments under VIPMP.
Given the above information, the objectives of this DD review are to:
a) assess if the completed compensation payment/provision of support/resettlement activities and the outcome of such resettlement activities meet the objectives of Bank’s OP 4.12, and
b) Identify if there are any pending resettlement related issues and if yes propose follow-up action(s) to resolve such pending issues in accordance of domestic policies and the objectives of Bank’s OP 4.12.
Since the Bank is expected to finance the installation of the CETP only, the DD focused on involuntary resettlement activities that took place within land area required for (a) the installation of the CETP[1] and (b) the IZ area to be served by the proposed CETP installation.
Two key elements that are of particular importance for this DD include a review to (a) verify the existence of an effective Grievance Redress Mechanism to respond to complaints, queries or other issues related to the resettlement; and (b) verify the results of the livelihood restoration of the peoples affected by the acquisition of land areas used for the CETP and its service areas. If Government regulations applied are not in consistency with World Bank’s policy objectives, a remedial action plan will be prepared for implementation by the IZ – subject to the Bank’s clearance prior to implementation.
C. Methods
This Due Diligence (DD) review was conducted in accordance with the project’s ESMF (March 2015 version). The methods employed include: (i) desk review of secondary information (including project documents provided by the GoV for the reviewed IZ (see details in Appendix 2); and (ii) interviews with relevant government officials, including representatives from District Resettlement Committee, IZ representatives, representatives from affected households. (see details in Appendix 3); and c) field observations.
The field visit was conducted by VEPF’s social specialist, joined by Bank’s Social Development Specialist and Environmental Specialist. Interview/consultation with local people and local government, including representatives from affected households, commune’s People’s Committee, and IZ owner were conducted by VEPF’s Social Specialist and Bank’s Social Development Specialist.
Since the total number of affected households (associated with the CETP location and its service area) are large (495 households), a stratified sample was taken (as below). About 20 households were invited to the consultation meeting. However, because of the late arrival of the VEPF and Bank’s specialists, only eleven households remained to participate in the consultation. In addition to interviewing with affected households, consultation/interviewed were also conducted with district staff involving in compensation payments (from Center for Land Fund Development of Nhon Trach District). Three of the archived compensation payment records(related to three households consulted) were reviewed.
Table 1 – Sampling
No / Type of Impacts / IZ Impacts / Consultation SamplingCETP
(2.5ha) / CETP Service Area
(449.6ha) / CETP / CETP Service Area
1 / HH losing agricultural land/structures / 10 / 485 / 9 / 2*
2 / HH relocating / 3 / 19 / 2*
TOTAL / 10 / 485 / 11
· The same two HHs lost their agricultural land and were relocated.
D. Findings
This section will present basic information regarding to Ong Keo IZ, followed by the VEPF’s assessment on the level of compliance with regards to resettlement implemented by the government.
· Basic Information of the IZ and CETP
Ong Keo IZ is located in PhuocKhanh commune, NhonTrach district, Dong Nai province. Location details are as follows:
· North adjacent to main urban road;
· Northwest adjacent to Cha La Lon canal;
· West and southwest adjacent to Long Tau river;
· East: Next to Ong Keo canal;
· South: Adjacent to Dong Tranh river.
Please see map of the IZ at Appendix 1 for details.
The operation of the IZ was approved by the Prime Minister in Decision No. 284/2006 /QD-TTg on 21st December 2006. In line with this, Tin Nghia Corporation was assigned by Dong Nai People’s Committee as the investor of Ong Keo Industrial Zone- through Dong Nai PC’s Decision No.2557/QD-UBND dated 10th August, 2007, with the adjustment dated 20th January, 2014 (Decision No. 191/QĐ-UBND).
Ong Keo IZ has a planned operational total area of 855.6 ha – being developed in five stages. The IZ has completed land acquisition for the first three stages, covering a total of 452.1 ha. Of the total 452.1ha already acquired, 272.5ha was acquired by the People’s Committee of Dong Nai from 1999 to 2008. The remaining 179.6ha was acquired by Tin Nghia Corporation - from 2004 to 2013. Of the total 179.6 ha acquired by Tin Nghia Corporation for the purpose of Ong Keo IZ, 47.1ha was acquired and compensated for by the Center for Land Fund Development of Nhon Trach District from 2008 to 2014. The remaining 132.5ha was acquired directly by Tin Nghia Corporation from 2004 to 2013 on the basis of willing buyer-willing seller.
In terms of the proposed financing for the CETP within Ong Keo IZ, field visit indicated a CETP has been installed - within the mentioned area of 2.5ha with capacity of 6,000 m3/day. The CETP is at the moment with capacity of 3,000 m3/day ready for operation, pending pipeline connection to industries within the 452.1ha acquired under Phase 1,2, and 3.
It is noted the IZ has been in operation with ten companies and another five companies are about to operate in a near future (MOU with them have been signed).
· Evaluative Review of Resettlement Implementation.
In this section, results from evaluative review of resettlement implementation associated with the CETP location and CETP service area will be summarized. The review was conducted on the basis of the information provided by VEPF, Ong Keo IZ, the Center for Land Fund Development of Nhon Trach District, and the consultation with representatives of affected households, and local governmental officers.
The overall land acquisition/resettlement plan was implemented through the Decision approved by the People’s Committee of Dong Nai province (Decision No. 3481/QD-UBND) dated 22 October 2008 in which land acquisition carried out by the Center for Land Fund Development of Nhon Trach District commenced in 2008. In the 452.1 ha being used, a total of 495 households were affected, of which 10 households were affected by the CETP area and 485 households by the CETP service area. Most of the affected land was agricultural land. Twenty two households had to be relocated from the IZ area acquired by Tin Nghia Corporation.
Schedule for Compensation Payment.
Area acquired / By / Period272.5ha / People’s Committee of Nhon Trach District (Dong Nai province). / 1999 to 2008
179.6ha / Tin Nghia Corporation / 2004 to 2013
The Overall Compensation Plan for the IZ was issued and approved by the provincial government, People’s Committee of Dong Nai province (Decision No. 3481/QD-UBND) dated 22 October 2008. The compensation payment was carried out by the Center for Development of House Land Fund of NhonTrach,from 2008 to 2014.
Compliance with GoV regulations.Review of the records/legal documents provided by Ong Keo IZ and through consultation with Center for Land Fund Development of Nhon Trach District indicated that the compensation/support and resettlement plan which was prepared by this Center have been prepared and implemented in compliance with the Vietnamese regulations (Land Law 2003 and Decree 197/2004). Compensation payment, as the Center confirmed, were also made on the basis of consultation with affected households, and on the basis of the census made by affected households and district People’s Committee (with reference to provincial regulations by the time of compensation payment). The compensation principle adopted by the Center for Land Fund Development of Nhon Trach District is the latest compensation prices were applied (as a starting point) at the time of compensation payment. This was appreciated by affected households.
Entitlements for Affected Households (AHs).The entitlements for affected which were prepared in accordance with Government and provincial regulations (as mentioned above), and were approved by NhonTrach District People’s Committee – for the period from 2008 to 2014. The proposed entitlements for affected households were accepted by the affected households and affected land have been handed over to the IZ. Entitlements cover the affected land, structures, and crop/trees affected, as well as resettlement sites for cases where there were loss of houses/residential land. Consultation with the affected households indicated that the compensation rates applied followed the rates defined annually by the provincial People’s Committee. These rates were adjusted (increased) in consultations with affected households, considering their specific socioeconomic situation and household compositions/size. Allowances to affected households were also provided as per provincial regulations and were also provided as part of compensation/support package that the affected households were entitled to.
Table 4: Summary of entitlements provided to affected households.
Item / Type of Loss / Application / Entitled Persons / Compensation Policy /A / Compensation
1a / Loss of land / Agricultural land - partially or fully affected, permanent. / Owners with LURC, eligible to acquire LURC. / Cash compensation for acquired land at price stipulated by Dong NaiPeople's Committee.
1b / Loss of land / Residential land Fully or Partially affected: / All AHs affected with residential land and housing.
2 / Loss of structure / Secondary structures -partially or fully affected / Owner of structures regardless of tenure status / Cash compensation for acquired asset/structures at price stipulated by Dong NaiPeople's Committee.
3 / Loss of crops and trees / Loss of Trees/Crops / Owners regardless of land titles / Cash compensation for acquired crop/trees at price stipulated by Dong NaiPeople's Committee.
B / Rehabilitation Allowances
4 / Households whose existing agricultural land is affected / Support with vocational training and job change:
Support for stabilizing household living standards: / All AHs,
AHs with 30% or more of their total agricultural land affected / Support with vocational trainings.
Support in cash equivalent to 30 kg of rice/person/month at local market price for 6 months.
5 / Displacement from residential housing / Requiring resettlement / Relocating households regardless of tenure status / Eligible households were provided a plot of land from the established resettlement site (free of charge, in addition to other compensation entitlements).
Budget for compensation payment. Budget for resettlement compensation and allowance were provided by Tin NghiaCorporation in accordance with the Overall Compensation Plan as approved by the Dong Nai PC. It is noted that provincial rates were adjusted to reflect market prices at the time of compensation payments. According to the Center for Land Fund Development of Nhon Trach District, most of the annual adjustment of compensation prices resulted in an increase in compensation prices which were supported by the affected households.
Consultations and Information Disclosure: Consultation was conducted during preparation of the Overall Compensation Plan to achieve consensus among the affected households with regards to compensation payment. Compensation plan(s) were disclosed in the commune’s People’s Committees. Affected households participating in the consultation meetings during this DD mission confirmed they were fully aware of the compensation and resettlement policies applicable for the IZ Phase 1 and were pleased with the compensation/support package.
Grievance Redress Mechanism. According to the information provided, a grievance redress mechanism was established and maintained which followed the local regulations to address complaints submitted. The grievance system was established in the Center for Development of House Land Fund of Nhon Trach, to resolve complaints raised by affected households. Affected households also could come to commune’s PC to lodge their complaints, or ask for clarifications.