Compensation valuation for the resettlement of the indigenous communities in Bakun Hydroelectric Dam, Sarawak, Malaysia

• Main Author: Lee, Wen Chiat
• Format: Thesis
• Language: English; English
• Published: 2014
• Subjects: HC Economic History and Conditions
• Online Access: https://etd.uum.edu.my/4384/1/s93837.pdf; https://etd.uum.edu.my/4384/2/s93837_abstract.pdf; https://etd.uum.edu.my/4384/

Compensation for indigenous communities as a result of development projects has been a controversial subject. The elements of rights, entitlements, freedom and justice are often difficult to value and left out in the compensation processes. Most of the compensation packages given to the indigenous communities are in-use values and non-use values are often ignored. The non-use values which include environmental, social and cultural values are very difficult to determine and often not compensated by government. These non-use values are more important compared with use values to the indigenous communities. In this study, a sample of 379 settlers in Sungai Asap Resettlement Scheme relocated as a result of the Bakun Hydroelectric Dam Project in Malaysia is surveyed to estimate the satisfaction with compensation as perceived by the settlers. The data was collected from September 2012 to December 2012. Logistic regressions models were used to identify the components of valuation of displacement cost that affect the settlers' satisfaction with compensation. The study of compensation valuation can result in better policies for compensating people affected by large projects. These policies will incorporate aspects of welfare more effectively thus increasing legitimacy for agencies involved in the relocation of communities. The findings showed that gaps in land compensation (differences in expected compensation and actual compensation paid out by state authorities) can result in dissatisfaction towards compensation. Besides that, environmental value (non-use value) perceived by the settlers is found to be significant in affecting probability of dissatisfaction towards compensation. The most important finding is that the lack of freedom and rights of settlers to participate in resettlement processesbring about dissatisfaction towards compensation. This has policy implication for government initiatives on compensation. An institutional avenue to consult and discuss the compensation figures with the settlers should be present to ensure agreeable compensation