Monday, September 29, 2003

Some discussion on the Three Gorges Dam:

The story behind this is likely that the silting process at the bottom of the dam is occurring much more rapidly than the optimistic government projection. In order to make the dam economically viable for a few more years, the government decided to raise the height of the dam. There is high incentive to do this. The 1993 estimate of the cost of the 3 Gorges was 90.9 billion yuan, while the latest estimate (3/2002) was 203.9 billion yuan. The 3 Gorges Company has worked with the State Council, the State Development Bank, and the Big Four banks to raise this amount, and the likely increases in the future (the completion date is 2009). Some very powerful players in the Chinese bureaucracy have a vested interest in the project. For example, Huaneng is a major shareholder of the 3G company, while SDB and the Big Four banks have lent tens of billions to the project. I think the regime as a whole, and not just Li Peng, is so vested with the project that it cannot bear to see it fail. The problem with raising the dam by four meters, besides displacing more people, is that it will exacerbate the environmental impact of the 3G. Already, environmentalist predict 3G to become the world’s largest cesspool.


I know from a reliable source that the central government is planning to spend about 40 billion RMB on water treatment in the next ten years. So, they are not completely unconcerned about the cesspool problem.

I have heard many officials and academics say that silting is a major problem. The main concern with silting is not transportation. Economically, if the reservoir begins to fill up, the water pressure of the dam will decrease, which decreases the amount of power generated by the 3G hydroelectricity plants. This is the problem I was referring to yesterday about the high financial stakes of the project. The project counts on power generation for financial returns. Also, silting means a gradual expansion of the area of the reservoir, which means more relocation, political problems, and environmental problems. I am attaching both an official People's Daily report and a recently de-classified CIA report on the issue.

The CIA report can be found at: http://www.cia.gov/csi/monograph/425050797/2.htm

The RMRB article can be found at:


Even the official report said that silting can "hopefully" be solved.

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