More than a decade after the World Bank was forced out of the dam-building industry due to the social and environmental consequences of the projects they helped to finance, World Bank support for the development of the Nam Theun 2 (NT2) Hydroelectric Project, located atop the bio-diverse Nakai Plateau in central Laos, signals the re-emergence of the Bank’s involvement in large-scale dam construction initiatives. The NT2 project is the Bank’s response to its international critics. The project is a ‘test case’ for a new model of hydropower development that seeks to counteract any negative consequences to the surrounding environment and populations through the enactment of a new set of environmental and social safeguards that the Bank had spent over a decade developing. As the optimal consequence, if NT2 achieves the goal of safeguarding the bio-diverse environment of the Nakai region through the creation and implementation of long-term ‘socially and environmentally sustainable’ livelihood activities capable of raising the living standards and income levels of Nakai villagers beyond the national poverty line, then the NT2 model of development will be validated and its use in other World Bank supported hydroelectric initiatives all but assured. The alternative result is that the new safeguard mechanisms fail to achieve these goals, significantly contributing to the destabilization of one of the of the most environmentally and culturally unique regions in the world. This thesis analyzes the effectiveness of NT2 social and environmental safeguards in order to determine to what extent this new model of development is achieving the objectives it set prior to construction. Using a range of data, it analyzes outcomes produced from the core safeguards program of the project: the resettlement livelihoods’ programmes. Analysis of villagers’ livelihoods after resettlement clearly indicates that the NT2 model was never able to overcome challenges posed by reduced access to forest and agricultural lands for re-establishing villagers’ core land-based livelihood activities. As a result, many villagers have abandoned the livelihoods programmes at resettlement villages across the Plateau. In the short term, these villagers have, nevertheless, significantly increased their incomes through intensified commercial fishing and export-oriented rare timber and endangered wildlife extraction activities. The problem for NT2 developers such as the World Bank is that this form of economic activity is neither socially nor environmentally sustainable, placing the regional environment, local populations and the NT2 project in jeopardy. / Graduate