In Search of Aluminum: China’s Role in the Mekong Region

The report examines the emerging bauxite mining sector in the Mekong region, focusing on the strategic interests of China in Cambodia, Laos, and Vietnam. It details the investment landscape, where Chinese firms dominate in Laos and provide engineering for Vietnam, while Australian firms lead in Cambodia. The document highlights critical constraints, such as the massive energy requirements for aluminum smelting and the lack of cheap hydropower. It further argues that existing environmental and social regulatory frameworks in these countries are poorly implemented, leading to transparency gaps and risks to indigenous communities and transboundary water systems, particularly the Sekong River.

• China is strategically expanding its overseas mining investments to meet domestic demand for natural resources, driven by the 'Going Global' (or 'Going Out') strategy and the 10th Five Year Plan for National Economic and Social Development (2001–05).
• The Mekong region is a strategic target for China due to its proximity and resource abundance; Chinese investors dominate in Laos through consortia, provide engineering procurement construction (EPC) for alumina factories in Vietnam, and are currently not involved in bauxite mining in Cambodia.
• Aluminum smelting requires immense amounts of cheap energy, which is currently a primary barrier to a full value chain in the region. For production to be cost-effective, hydropower electricity needs to be priced at 2.5–3.5 U.S. cents/kilowatt, but Laos currently sells it at 5–6 U.S. cents/kilowatt.
• Bauxite mining in the region poses significant transboundary environmental risks, specifically the generation of alkaline 'red mud' which threatens the water quality of the Sekong River and the livelihoods of downstream communities in Cambodia.
• Environmental and social regulatory frameworks in Cambodia, Laos, and Vietnam are generally not well implemented, characterized by a lack of transparency, minimal public consultation, and the absence of strategic environmental assessments (SEA) in Vietnam.
• Local and indigenous communities in the bauxite-rich areas of Mondulkiri (Cambodia), the Bolaven plateau (Laos), and the Central Highlands (Vietnam) are likely to bear disproportionate environmental and economic costs with uncertain benefits.

APA

Lazarus, K. M. (2009). In Search of Aluminum: China’s Role in the Mekong Region. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/in_search_of_aluminum.pdf

Chicago

Lazarus, Kate M. In Search of Aluminum: China’s Role in the Mekong Region. International Institute for Sustainable Development, 2009. https://www.iisd.org/system/files/publications/in_search_of_aluminum.pdf.

Wikipedia

{{cite report |last1=Lazarus |first1=Kate M. |title=In Search of Aluminum: China’s Role in the Mekong Region |publisher=International Institute for Sustainable Development |date=2009 |url=https://www.iisd.org/system/files/publications/in_search_of_aluminum.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{lazarus2009search, author = {Lazarus, Kate M.}, title = {{In Search of Aluminum: China’s Role in the Mekong Region}}, institution = {International Institute for Sustainable Development}, year = {2009}, url = {https://www.iisd.org/system/files/publications/in_search_of_aluminum.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }