Three Gorges Probe

News briefs

September 28, 1998

 

 

(i) 18,600 Residents at Yangtze Dam Relocated

(TGP, 09/98) About 18,600 residents of Zigui County at the Three Gorges dam site have been relocated to new homes, according to a Xinhua story. They are among the first group of 100,000 people in the county who will be resettled in neighbouring areas.

About 1.8 million people will be evacuated because of the installation of the world’s largest reservoir. The resettlement plan will cost US$4.8 billion by the time that the dam is completed in 2009. The process is plagued by problems of corruption, conflict of interests, inadequate funding and local resistance, according to a field report conducted by a Chinese sociologist. (See Wu Ming’s article, published by TGP9801-9803.)

(ii) Erosion and Logging Cause Floods

(TGP, 09/98) The Chinese government has admitted that erosion and the loss of wetlands are major causes of this year’s disastrous floods.

Reclamation of wetlands and lakes reduced natural water storage capacity by 32.5 billion cubic metres nation-wide — equivalent to 1.5 times the size of the Three Gorges reservoir, says a China Daily story.

Ecologists in China are urging the government to enact immediate initiatives to restore wetlands which are vital for water and soil conservation. They are also calling for a strict ban on excessive logging and deforestation, two principle precipators of erosion. Illegal logging is said to be responsible for the loss of 440,000 hectares of forests each year in China. Last year alone, 600,000 such cases were reported.

New government regulations in the aftermath of this year’s flood mandate that all woodland converted to farmland since 1994 be replanted with trees by the year 2000.

(iii) Flood Control System Out-of-Date

(TGP, 09/98) A decade of sparse funding for water conservation and flood control projects has near destroyed China’s flood management system.

China’s investment in water conservation totalled 115 billion yuan (US$13 billion) between 1991 and 1997, says a China Daily story. That constitutes only one percent of the total investment in infrastructure projects, and is peanuts compared to the country’s investment of US$167 billion on energy projects, US$57 billion on telecommunications and US$53 billion on urban construction.

Over 600 Chinese cities are vulnerable to floods, but the existing levees and embankments are, according to all accounts, ill-equipped to withstand serious deluges. Not only were degenerating weirs and dykes along the Yangtze River breached earlier this year after being under siege by flood waters for months, but one-quarter of China’s 80,000 reservoirs have defects significant enough to cause mass devastation should they fail under flood conditions.

(iv) Yangtze Dam Seeks Foreign Financing

(TGP, 08/98) According to a Financial Times report, the Three Gorges Corporation, the company responsible for China’s Yangtze dam project, has once again turned its gaze to foreign investors for funding. It is mulling over plans to either issue international bonds or to become a public company in an attempt to raise 20 percent of the dam’s financing (US$4.9 billion) from overseas.

Wang Jiahu, deputy manager of Three Gorges Corp, confirms that the firm is considering going public, though any such plans are contingent upon approval by the Chinese government.

Meanwhile, the China International Capital Corp, in which Morgan Stanley’s Dean Witter owns 35 percent, is in the process of drawing up plans with Three Gorges Corp for a share listing on both the New York and Hong Kong stock markets.

Beijing, meanwhile, is committed to covering 60 percent of the project’s costs, an amount which will predominantly be conferred in the latter stage of the project. The corporation has also taken to borrowing from domestic banks, and recently secured loans worth about 6 billion yuan (US$723 million) from three Chinese commercial banks. An additional Three Gorges bond — worth about 1 billion yuan (US$120.5 million) — will be issued to investors in China over the next five years.

Many foreign investors have kept away from the project for fear of opposition at home due to environmental and social concerns.

Categories: Three Gorges Probe

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