(December 28, 2012) The fight for a slice of the central government’s subsidy pie continues in the Three Gorges Dam region as local governments compete for funding to address the economic and environmental problems caused by the mega-dam’s construction. This impact update by Taiwan-based news site, Want China Times, reports that these problems remain unresolved and that residents, forced to relocate for the dam, continue to be dogged by an economic malaise. With or without subsidies, local governments are ploughing ahead with projects to build infrastructure and industrial parks. Meanwhile, usurped residents say the government should give them the subsidy money in cash, directly. Cash pay-outs that bypass local government officials would likely be money better spent: Probe International has published scores of reports over the years detailing the ways in which compensation funds for relocated residents, and past projects designed to support their transition, have proved useless at best or have disappeared into corrupt officials’ pockets at worst. For so many reasons, Probe International has concluded the Three Gorges Dam project represents a money drain that will never be plugged.

“Show us the dam money: Fights over post-Three Gorges subsidies,” Want China Times*,  originally published, December 19, 2012

The Three Gorges Dam in Yichang, Hubei province. (Photo/Xinhua)

Local governments around China’s Three Gorges Dam are continuing to fight for central government subsidies to resolve the economic and environmental problems caused by the construction of the dam and the relocation of residents, Beijing’s Economic Observer reports.

At the end of October, the dam, the world’s largest hydroelectric power station by installed capacity, entered a phase of stable operation after its water level reached the full capacity of 175 meters for the third consecutive year.

However, the problems associated with the relocation of residents who had to make way for the project, as well as the environmental impact of the dam, are far from being resolved.

At the end of 2011, Nie Weiguo, director of the executive office of the Three Gorges Project Construction Committee under the State Council, said a tough task remains to ensure stable livelihoods for the relocated residents.

According to Wei, 11 districts or counties in the vicinity of the dam are among the key regions which the government planned on pulling out of poverty. These areas had a low level of modernization in the agricultural sector, and are trailing in employment and infrastructure.

The situation, the newspaper said, is the result of a lack of investment in the region, given the expectations for the dam project since the People’s Republic of China was founded in 1949.

Although the executive office began drafting guidelines for subsequent projects related to the dam in October 2008, the State Council did not pass the master plan until May 2011. Under the plan for subsequent projects, the country is set to invest 123.8 billion yuan (US$19.9 billion) — half the amount spent on building the dam — between 2011 and 2020.

In mid-October, the municipality of Chongqing on the upstream side of the Three Gorges Project, announced the first batch of 152 projects, which would involve a total investment of 7.64 billion yuan (US$1.23 billion).

However, the funds will only be partially sourced from the central government, with local governments having to invest in the projects as well, the newspaper said.

With such tight funding, local governments at all levels are fighting for budget allocations, with some counties and districts going ahead with their projects although the subsidies are yet to be secured.

While local governments are mainly focusing on building infrastructure and industrial parks, some relocated residents whose old homes are now under water hold the view that the government should just hand them the money in cash, one Chongqing official told the newspaper.

* Want China Times bills itself as a Taiwan-based news site that provides uncensored news on China and Taiwan.

The original version of this article is available here.