Trade-driven model of "Hydropower for Rice" cooperation in the Lancang-Mekong River basin

There have been intense conflicts over water resources between upstream and downstream countries in the Lancang-Mekong River Basin (LMRB) over the past years, primarily due to the trade-off relationship between hydropower and rice production. Great potential for transboundary cooperation has been shown, such as China's emergency water release in 2016 to alleviate downstream severe drought. However, there is still a lack of systematic cooperation pattern. To address this issue, the study proposes a trade-driven model of "Hydropower for Rice" cooperation, and then derives three key political factors including price weight, export rate, and terminal water level of reservoirs. Our results show that (1) The hydropower and rice production under the trade-driven model can approximate the centralized model, and the "Hydropower for Rice" cooperation is feasible. (2) For downstream countries, rice is the main product, and the rice production and economic benefit can be increased with a higher price weight or export rate. Compared to Thailand and Cambodia, Vietnam needs to engage in deeper trade with China. (3) For upstream China, hydropower is the main product, and the economic benefit of riparian countries can be increased with higher export rates. The discharge in the dry season is increased, which is driven by the trade of rice. Additionally, China's initiative to reduce the terminal water level of reservoir Nuozhadu has the potential to further increase rice production in downstream countries. This study indicates that the transboundary cooperation in LMRB requires joint efforts of upstream and downstream countries.