MANILA, PHILIPPINES (7 November 2012) - The Asian Development Bank (ADB) and Australian Agency for International Development (AusAID) will provide an $87.39 million package of loans and grants to help Lao People's Democratic Republic (Lao PDR) and Viet Nam pair infrastructure upgrades with community-based disaster risk management and enhanced regional forecasting to improve flood and drought preparedness in the Greater Mekong Subregion (GMS).

"Floods and droughts in the Lower Mekong Basin can have a major impact on farming, food supply, and infrastructure, but reducing the risk isn't just about building hardware, it's also about equipping communities with the skills to plan, predict, and prepare for climate change," said Su Chin Teoh, Natural Resources Specialist in the Southeast Asia Department at ADB.

In addition to upgrading or developing canals, drainage pumps, and embankments in Vientiane capital region, Lao PDR and Dong Thap and Tien Giang provinces in the Mekong Delta in Viet Nam, the assistance will also be used nation-wide in both countries to collect data, information, and knowledge to prepare flood and drought forecasts.

Design criteria for flood and drought mitigation measures in the Mekong Delta will also be developed, and transboundary flood management options will be assessed. A National Early Warning Center will also be established in Lao PDR.

The direct cost of droughts in the Lower Mekong Basin is severe, causing massive losses in rice yields and reducing livestock and fisheries. Extreme weather is dangerous to the lives of families and farmers, and the cost of recovering from weather-related emergencies erodes their ability to save and invest in their futures. The 2004-2005 drought, for example, cost an estimated $42 million in the Mekong Delta, in addition to triggering localized food shortages.

Although annual flooding is seen as beneficial in replenishing wetlands with nutrients carried in the Mekong, extreme floods can cost, on average, as much as $70 million in damage a year. The challenge is to achieve flood management that reduces the costs while preserving the benefits.