Tuesday, January 31, 2012

Interview with Dr. Yu Xiaogang, "Civil society should look behind the curtain"

State-owned companies are pushing for a "Great Leap Forward" in dam
building. But Chinese NGOs can hold them to account, environmentalist Yu
Xiaogang tells chinadialogue.

"We should look behind the curtain"
By Isabel Hilton
January 30, 2012



Yu Xiaogang is director of the NGO Green Watershed, based in the city of
Kunming, in south-west China. A veteran environmentalist and past winner
of the Goldman Prize, an award for grassroots green campaigners, he has
been at the forefront of China�s debate on dam building. At a recent
meeting in Delhi, Yu Xiaogang sat down with Isabel Hilton to explain his
concerns about powerful special interest groups in China who, he claims,
exercise undue influence on government policy.

Isabel Hilton: Who are these special interest groups and why are you

Yu Xiaogang: One characteristic is their monopoly. The second is the
combination of their power and capital. China is in a transition period:
in the state-planned economy, every big company or industry was under
government control. Then we changed to the market economy, but big
state-owned enterprises (SOEs) still have power and they now get the
advantages of the market economy. So they use their influence with the
government to ensure they are allocated the assets; then they can get
resources from the stock or the bond markets.

The state benefits from this in several ways: through taxation, or
because such companies listen to the government most of the time. The
government can dominate the market economy because its share in some
industries is much bigger than in others. In energy for instance, it is
as much as 70%.

IH: What impact does this have on dam building in China?

YX: The government can dominate some very critical industries, like
railways, air transport, power industries and telecommunications. They
like to control them, but this also creates contradictions with their
ideology or the targets that the Chinese government is pursuing �
targets such as a just and harmonious society. These monopoly companies
go in the opposite direction.

The Chinese government wants to improve policy and reach "political
civilisation", but we think that the SOE monopolies have a triple role:
they are company owners; they are decision makers (or at least they can
capture the decision makers); and they also manage the market. So they
control everything and that�s not good for the free market or "political
civilisation". Also it creates conflict with the people, because this
combination of power and capital often works against the people�s
interests, against democracy and against public participation.

IH: Civil society managed to bring a halt to dam building under the 11th
Five-Year Plan. In the 12th Five-Year Plan, there seems to be a "Great
Leap Forward" in dam building in preparation. Will civil society be able
to mobilise again?

YX: We have realised that the 12th Five-Year Plan was influenced by
these interest groups. Before this plan was finalised, we observed a lot
of academics, official insiders, like the National Energy
Administration, decision-makers and think-tanks combined saying that
NGOs and civil society have misled the leaders under the 11th Five-Year
Plan and that hydropower�s environmental and social impact was not
negative. They portrayed it as a conspiracy between the international
community and civil society to attack hydropower development. Also they
said that because of the frozen period during the 11th Five-Year Plan,
we now need a "Great Leap Forward" in dam building.

We can see very clearly that this advocacy influenced the
decision-makers and we also think that NGOs can do something. I think
it�s very important to deconstruct this discourse, because Chinese
government decision-making is often influenced by this kind of
discourse. NGOs should debate it. The special interest groups often
operate behind the curtain � people don�t know about it. People think
that SOEs are better than private companies because at least they
operate in the interests of the taxpayer. People don�t know that they
are destroying the economy and the political system and hurting the
taxpayers� interests. So we need to tell people about this.

Why do these interest groups not pay attention to the environmental and
social impacts? Because they want the maximum profit. They don�t care
about the impacts. That�s why I think that civil society should look at
what interests there are behind the curtain; so we can understand why
they don�t listen to us and how they capture the government to make
decisions that favour special interest groups. NGOs can investigate this
and tell people the truth. Then people can perhaps find a solution
individually, or campaign on projects.

IH: What would your solution be?

YX: There are many possible solutions. Some are more political. For
example, some people say that these SOEs should make a profit. Many
don�t. They may pay their taxes but they don�t share their profits. The
taxpayer is the owner and should be recognised as such. The government
should represent the people�s view.

[First], the SOEs should make their profits transparent and share them
with social security funds or foundations for poverty alleviation or
some other public purpose. Second, the government should not be too
dependent on them. For example, in energy saving and emissions
reductions, we have hundreds of solutions and methods. We need to pay
attention and invest, to develop small and medium enterprises (SMEs)
that can solve this. We have many demand-side management opportunities
with small technologies. There are two general approaches: restraint and
counterbalancing with an increase in SMEs. The third element is checking
and monitoring. We should train the SOEs to follow market rules and
reduce their monopoly.

IH: Would you like to see a halt to the kind of dam building that is
proposed in the 12th Five Year Plan?

YX: Of course. We think that in the last 60 years, China has built so
many dams already. Very big dams were constructed, especially in the
last decade. Now the remaining rivers are in seismic-risk areas, so
building in these areas will be very risky to people downstream and we
must assess the environmental impact. We think we must assess the full
cost first.

They may say that we need energy, but we should also rationalise energy
consumption. This needs investment and education and the government to
change its orientation. In this way, the people can save energy and
reduce consumption. Only this way can we stop the dam construction.
First, tell the people the risks and then have the government pay
attention to the many small approaches that can solve the problem.

Isabel Hilton is editor of chinadialogue

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Thursday, January 26, 2012

Tanzania: drought's impacts on economy

Tanzania's over-reliance on hydro has had many ramifications for its economy... right down to a reduction in new  rural electrification connections.


Tanzania Seeks $257 Million Loan From Citibank, Other Lenders

 Jan. 19 (Bloomberg) -- Tanzania's state-owned power utility said it's in talks with a group of lenders including Citigroup Inc.'s domestic unit for a 408 billion-shilling ($257 million) loan to fund electricity generation.

The discussions may conclude this week, William Muhando, managing director of Tanzania Electric Supply Co., said in an interview today in Dar es Salaam, the commercial capital.

"The money is needed to fund emergency power projects that we undertook last year to meet demand," Muhando said. "We expect to conclude negotiations with a group of financiers led by Citibank today or tomorrow."

Tanzania, East Africa's second-biggest economy, had an electricity deficit of 264 megawatts last February following a drop in hydropower generation after a drought. The resulting power outages caused a slowdown in economic growth to 6.4 percent in the third quarter of 2011 from 6.7 percent a year earlier, the National Bureau of Statistics said on Jan. 17.

Tanesco, as the utility is known, is also pursuing financing for new generation projects to be commissioned this year, Muhando said. The government is expected to complete an agreement with HSBC Holdings Plc to fund a 100-megawatt gas- fired plant in Dar es Salaam, estimated to cost $165 million, he said.

"This and another 70-megawatt plant fired by heavy fuel oil in Mwanza have been contracted to Jacobsen Elektro AS," the Norwegian power-plant builder, Muhando said. In addition, the utility is seeking 83 million euros ($107 million) for a 70- megawatt plant in the northern region of Tanga, he said.


Tanesco expects to report an annual loss of 200 billion shillings for year 2011 and the same amount for this year because of the drought, Muhando said.

"We made a profit of 15 billion shillings in 2010, and 5 billion shillings in 2009," he said. "But the low water levels caused a loss in 2011, and this will continue this year."

Tanesco last year entered into a power-purchase agreement with Washington, D.C.-based Symbion Power LLC to produce 125 megawatts of electricity using both gas and Jet-1 fuel, as one of the emergency projects. The company also contracted Glasgow, U.K.-based Aggreko Plc to produce 100 megawatts using diesel, and boosted production at heavy fuel oil-fired generators run by Independent Power Tanzania Ltd. to 100 megawatts from 20 megawatts.

The 408 billion-shilling loan will be used to pay for fuel used until December 2011 and for a charge demanded by power generators when their plants aren't running at full capacity, Muhando said.

Power Output

Electricity output in Tanzania is currently 700 megawatts, matching demand, "which means the impact of any shortfall is significant," he said.

The talks on the loan are concluding a week after the country's energy regulator approved a 40 percent increase in electricity powers. Tanesco had applied for prices increase by 155 percent. The utility was hoping to use a "cost-reflective" tariff as a bargaining chip for the loan, as it would guarantee a specified amount of revenue, Muhando said.

A 155 percent increase in tariffs would have raised income to 359 shillings per kilowatt hour from 141 shillings per kilowatt hour currently, the power utility told the regulator in an application for the adjustment.

"We understand it is going to be an average hydrology year, meaning there will be water to generate electricity at the hydropower dams," Haruna Masebu, director-general of the Energy and Water Utilities Regulatory Authority, said in a Jan. 12 interview. "We also cannot increase the tariff so much because that could cause inflationary pressures."

Tanzanian Inflation

Tanzanian inflation accelerated to 19.8 percent in December, as energy and food costs increased.

Tanesco is revising its budget for 2012 to reflect a "non- cost-reflective" power tariff, and will postpone projects whose return on investment is long-term, Muhando said.

"We shall postpone some projects in rural electrification, and concentrate on those that bring returns in at most two years," he said.

In the event that the loan raised is less than the amount required, the utility expects to receive a government subsidy, Muhando said.

--Editors: Paul Richardson, Antony Sguazzin.

Davos 2012: Africa leaders urge co-operation on infrastructure, energy

26 January 2012

Davos 2012: Africa leaders urge co-operation


Some of Africa's leaders have urged closer co-operation within the
continent on energy and infrastructure projects to help its growth

Speaking at Davos, South Africa's President Jacob Zuma urged massive
investment in infrastructure to promote trade within Africa.

Guinea's President Alpha Conde said there should be pan-African
ministers for energy, infrastructure and trade.

He said he hoped the new ministries could be agreed by the African

Ethiopian Prime Minister Meles Zenawi agreed on the need for closer co-
operation on infrastructure projects and said the planning and
coordination body of the African Union, Nepad, was already working on

But he urged caution, warning it would and should be a long process.

"It took 50 years for the Europeans to come up with a single currency
and it appears they went too fast for some of its members," Mr Zenawi

The leaders were taking part in a session called Africa: From
Transition to Transformation, at the annual gathering of economic,
business and political leaders at the ski resort of Davos in

Mr Zuma said infrastructure was at the heart of one of the key issues
for the continent, namely how Africa leads itself.

"Africans must trade amongst themselves," he said.

"Intra-Africa trade is negligible," Kenya's Prime Minister Raila
Odinga pointed out. "Europe trades more with itself that with the rest
of the world."

The chair of the session, the former UK prime minister Gordon Brown,
said the continent needed billions of dollars of investment in
infrastructure, but red tape and cross-border problems were getting in
the way.

Mr Zuma said those issues, or bottlenecks, were being addressed.

"How we open up borders for the free flow of people, or workers, as
well as goods - that is being discussed as well as infrastructure," he

'New Africa'
Speaking at his first visit to the World Economic Forum, Guinea's Mr
Conde, who described himself as the country's first democratic
president after ten years of dictatorship, said: "If we want to move
ahead we have to help ourselves. If we do that we can agree on
producing our own energy, breaking down barriers to trade.

"The African leaders have to change our attitudes... not have money in
banks abroad... to develop our own resources for our own people."

"We have alot of faults, we are a bit selfish, fight for power rather
than our people.

"I am here to show there is a new Africa... that we can be the
continent of the 21st century."

For some of the leaders, the Indian economy, which developed rapidly
thanks to developing its manufacturing sector, was a model African
countries could follow.

"We are where India was in the early Nineties, we have the same size
of population," said Ethiopia's Mr Zenawi. "That is our ambition,
based on the growth of the past few years. It is not an idle ambition."

He said although the Millennium Development Goals - on relieving
poverty and disease in the world's poorest nations - concentrated on
advances in primary education, that would not be enough to create the
skills necessary to transform economies.

"Africa is a natural destination for manufacturing," he said, adding
that he hoped companies who relocated to Asia for cheap, efficient
labour, would relocate to Africa, given the necessary investment in
education and infrastructure.

However tackling the problem of corruption was still a "major issue",
said Tanzanian President Jakaya Kikwete.

"The first thing to fight against corruption is transparency," he
said, adding that his country was now publishing all mining contracts
as part of a new mining code.

"The best guarantee for an investor is transparency."

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Tuesday, January 24, 2012

Sharing benefits of large dams in West Africa

A follow up article to the report Sharing the benefits of large dams in West Africa by IIED (published late last year), from China Dialogue:

Sharing the benefits of large dams
Jamie Skinner
January 17, 2012


It's been nearly 50 years since the Akossombo dam was built in Ghana in 1965, flooding the lands and homes of 80,000 people, creating the largest manmade lake in the world, and securing Ghana's electricity supply.

Since then, west African countries have built more than 150 large dams. Like Akossombo, many have stimulated national development while also bringing considerable environmental and social challenges. Some local grievances have even passed down through the generations, clogging up government offices and courts with complaints over the way ageing dams were built.

Large dam construction largely went out of fashion among major donors after 1990, as global concern grew over local impacts. But the past decade has seen the World Bank and other major multilateral banks renew their support for large dams in the face of increasing energy and food demand. Can these projects avoid repeating history?

As part of the Global Water Initiative (GWI), the International Institute for Environment and Development (IIED) and the International Union for Conservation of Nature (IUCN) set out to help communities and governments learn from past experience to improve dam planning, benefit sharing and resettlement practices in west Africa. Their findings, published in a study at the end of last year, show that large dams could bring greater benefits to local populations.

Currently, more than 60 large dams are being built, or are on the drawing board, across Africa, 39 in west Africa. The new dams face a very different economic and political climate from those built before 1990. The 1983 Sélingué dam in Mali was constructed under military dictatorship, for example, whereas region-wide decentralisation and democratisation surround the country's latest dam project, at Taoussa. Donors' policies have also evolved to give much more attention and funding to safeguard the environment and people.

Yet flawed planning can still cause tragedies, and donor-funded megaprojects like dams lack the financial flexibility to respond to unexpected social consequences. Lessons from past projects could radically improve the impacts of dams being planned now, which might start construction in five years and stand for another hundred. And while authorities sometimes resist addressing the legacies of dams built 20 years ago, many are more open to considering better ways forward.

Between 2008 and 2011, GWI and local researchers reviewed documents from west African dams and talked with people who had to move out of the dams' paths. Focusing on six large dams in Burkina Faso, Mali and Senegal, we asked about the effects of resettlement, the dams' perceived benefits and who profited from them. Could these benefits be shared more fairly and effectively to allow development for all, and give affected people a stake in the project throughout its lifetime?

National workshops, involving both government and local actors discussed the emerging stories and drew out lessons for national policy. One broad message was that governments and donors should put dams' local development objectives on an equal footing with national objectives. Large dams are built for nationwide goals such as supplying electricity or irrigation, and people living near dam sites have often been seen as mere obstacles – needing to be moved and then compensated for their losses.

Disputes over compensation and resettlement lands dragged out and sometimes turned violent. Claims from Akossombo are still being submitted to land tribunals, for instance, while in Bagré, Burkina Faso, local chiefs are trying to protect what they regard as their customary land, ejecting immigrants attracted to new jobs and markets around the dam.

Instead of bearing the costs of conflicts – in both money and lost development opportunities – governments could channel a portion of resources created by dams to displaced communities, ensuring local people gain directly from the projects.

For example, GWI is now helping authorities in Niger design a local development fund receiving 2% to 3% of hydropower revenues from a new dam. Over the dam's 100-year life, this fund can meet the changing needs of local people – such as additional schooling, investments in agriculture or better water supplies – and provide flexible support that reduces dependence on the government to resolve resettlement conflicts. Besides hydropower revenues, shared benefits might include access to irrigated land, a share of electricity, or a structured fishery.

The research shows another crucial step is to codify legal rights to the land, houses and other resources that dams redistribute. Local people affected by dams need their rights protected by written agreements to avoid accusations of broken promises, conflict within host, resettled and immigrant communities and litigation around compensation.

In many cases, such as at Sélingué, immigration has added pressure on resources, and the transition from customary resource tenure (rights to resources held through long local custom, rather than positive law) to modern legal rights has been complicated. Decades into a dam project, traditional chiefs who allocated land to immigrants or watched the government do so may come to believe their own groups were left behind in the resettlement process.

In oral cultures, colourful predictions by government speakers can also sow tensions. A resettled village head at Sélingué recalled, "We were told there would be so much rice that we'd be able to eat it and sell it to buy millet if we ever needed any." In reality, irrigated rice plots proved harder and more expensive to cultivate than rain-fed millet. To ensure that plans for land rights, compensation and benefit sharing are clear and binding, governments must put them in writing.

GWI's research has shown that better sharing of the benefits from dams is in everyone's interest – government, local communities, private sector and donors. Supporting local development alongside a dam's national goals is not costly or complicated, and prevents protracted disputes that drain government resources over the long term.

The GWI initiative is working with dam development authorities, civil society and local communities to build these lessons into dam plans in Guinea, Mali, and Niger. It also contributes to thinking by international river basin agencies and the Economic Community Of West African States (ECOWAS), on good practice for large water infrastructure in West Africa. And with the new wave of African dam building still gathering momentum, there is more need than ever for projects to learn from the past.

Jamie Skinner is a principal researcher at the IIED and co-author of the report, "Sharing the benefits of large dams in West Africa".

Download the full report here.

Homepage image by ZSM/ Wikipedia

Katy Yan
International Rivers | 国际河流
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Monday, January 23, 2012

Uganda: Donors Locked Out of Karuma Power Project


Uganda: Donors Locked Out of Karuma Power Project
Esther Nakkazi

22 January 2012

The battle between Uganda and Western donors over the 660MW Karuma
power station has escalated with a key lender now accusing the
Ministry of Energy of locking it out of the project as well as
refusing to accept free advisory services.

"Various development partners have made offers to support the
implementation of the Karuma Project, for instance through technical
advisers or financing for an international panel of experts for dam

Thus far, these offers have not been taken up," said Dr Jan Martin
Witte, senior project manager at KfW Entwicklungs bank.

KfW had offered to get an international firm to evaluate the tender
process but the government of Uganda refused.

Arguing that they want to avoid the kind of "environmental and
financial noise" that frustrated the first attempt at developing the
250MW Bujagali power station, which is coming on-stream 16 years late,
senior Ministry of Energy officials were unapologetic about their
stance, despite the risk that locking out alternative views could
result in grave design errors or a faulty procurement process.

The World Bank and Norway also wanted to support the project, but
government officials accuse them of failing Karuma One, the project
first proposed by Norwegian developer Norpak Power Ltd.

Norpak wanted to develop the site first but was allegedly frustrated
by the World Bank, which insisted that the project would only be
financed after Bujagali was complete. Norpak eventually abandoned the
project in 2008.

"Having learnt a lesson from Bujagali, we are not prepared to go
through that again," said Bukenya Matovu, head of communications at
the Ministry of Energy and Mineral Development.

"They will not listen to anything that in their view will delay the
project. We have not been asked for any support. Everybody at the
ministry is keeping the information close to their chest, and I
understand this is due to the Bujagali experience. Nevertheless, we
would like to be engaged in the procurement process for the EPC
contractors," Dr Witte said.

Nine international firms, including four Chinese contractors, will put
in their bids at the end of this month for construction of the Karuma
hydropower dam.

KfW says it anticipates problems because Uganda has difficulties in
attracting private sector investors for large-scale durable investments.

The proposed site for Karuma, which is downstream of Lake Kyoga, is
the only remaining spot on which Uganda can build a dam along the Nile.

The Ministry of Finance has been putting aside $70 million annually
since 2007 and now has some $350 million to finance the initial phases
of the project.

The cost of the dam is not definite at this point, though, and could
rise past the initial estimate of $2.2 billion, depending on what the
geology throws up.

According to Henry Bidasala, assistant commissioner at the Ministry of
Energy, Uganda has contracted the India-based firm Energy Infratech as
project consultants to conduct feasibility studies and act as project
supervisors. The government is also recruiting a project manager. The
position has already been advertised.

Chinese equipment worry

The donors also caution that the four Chinese contractors bidding for
the construction contract may not be up to the job.

While acknowledging that there are many experienced and qualified
Chinese contractors who have successfully delivered projects in
Africa, they say there are exceptions: Electrical and electro-
mechanical equipment from China tends to be of lower quality than
equipment manufactured in Europe or the United States.

"The electrical and electro-mechanical equipment has a big impact on
the efficiency, durability and operation and maintenance costs of
hydropower plants," said Dr Witte.

However, Mr Bukenya said this was not an issue. "We are not even sure
that the Chinese will win the bid, but if they do I am sure they will
do their best to demonstrate their competencies.

Relevant Links
� East Africa
� Uganda
� Energy
There is a cut-throat competition between the East and West with
campaigns to capture resources," he said.

The government of Uganda continues subsidising electricity to make it
affordable to the end users. Since 2005, the subsidies provided have
cost the government $200 million a year.

The National Planning Authority recommends that Uganda increase its
power generation capacity to 3,500 MW by 2015 to meet growing.
However, key projects are still far down the pipeline with Karuma
expected to have a procurement to delivery cycle as long as 10 years,
according to independent estimates.

Uganda has an installed capacity of 630MW but almost half of it is off
the national grid due to various factors including; non-payment of
power generators, and the reduced water level of Lake Victoria.

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Friday, January 20, 2012

Next Uganda dam to take 10 yrs, cost $2.2bn


Karuma dam works to take at least 10yrs


Posted Friday, January 20 2012 at 00:00

Electricity consumers will have to wait even longer for relief from
the power crisis since the 600MW Karuma dam project will take at least
10 years to complete, an energy expert from the United Kingdom has said.

The project estimated to cost $2.2b (about Shs6 trillion) will start
in May and according to the original government plan, should be
complete in five years, but Mr Neil Pinto, the chief executive officer
of Power Planning Associates Ltd, a UK firm contracted to work on the
project, Karuma would take a minimum of 10 years to complete.

�Bujagali is estimated to have cost $1b. My estimate is that Karuma
will cost $2.2b. There are several engineering challenges that are
going to be presented by Karuma such as long tunnels that shall have
to be built,� he said.

Mr Pinto said unless government establishes new electricity plants by
2014, Ugandans would be in exactly the same position in two years that
they are presently in. He proposed that government builds heavy fuel
oil power station in the meantime because it can be done faster.

Mr Pinto was on Wednesday speaking in Kampala during a public dialogue
organised by the Makerere University Economic Policy Research Centre
brainstorm on energy sector reforms. Electricity demand is growing at
10 per cent annually whereas generation is growing at 4.7 per cent,
which has partly led to power shortage and subsequent load-shedding in
the country.

The chairperson of Parliament�s Committee on the National Economy, Mr
Stephen Mukitale, said government had �over-hyped� large
hydroelectricity projects at the expense of other energy sources. He
said Parliament is considering compelling citizens to use solar energy.

The proposal would require that before a residential plan is approved,
it should have solar panels. He said this was meant to save the little
power that is generated for other purposes.

While Energy Minister Irene Muloni said power subsidies had reached
�unsustainable levels, especially given the need to invest in new
generation capacity and increasing access to rural areas.�


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Thursday, January 19, 2012

China urges hydropower developers to heed environment, must "put ecology first"

China urges hydropower developers to heed environment
BEIJING | Tue Jan 17, 2012 3:17am EST


Jan 17 (Reuters) - China's hydropower developers must "put ecology
first" and pay strict attention to the impact of their projects on local
rivers and communities, the country's environment ministry said on
Tuesday, as the country embarks on another dam-building boom.

The Ministry of Environmental Protection said in a notice posted on its
website (www.mep.gov.cn) that projects should be planned
"comprehensively" and must pay attention to "economic and ecological
benefits, local and overall interests (as well as) immediate and
long-term interests."

It ordered developers to make sure that residents affected by hydropower
development are fully informed and given a role to play in the
decision-making process, and stressed that building dams in protected
zones remains prohibited.

The ministry's intervention comes in the wake of a controversial
decision to reduce the size of a protected nature reserve in southwest
China's Chongqing in order to allow the construction of the massive
30-billion yuan ($4.75 billion)Xiaonanhai hydropower plant on the
Yangtze River.

The size of the reserve was already reduced in 2005 to make way for the
Jinsha hydropower plant, currently being built by the Three Gorges
Project Corp.

"It is the last freshwater wildlife reserve on the Yangtze, but even
with the legal protection, it is still a strong possibility that it will
be dammed," said Ma Jun, director of the Institute of Public and
Environmental Affairs.

"That by itself demonstrates how far the dam builders like the Three
Gorges Project Corporation want to move forward."

China's hydropower building boom slowed considerably following the
completion of the controversial 185-metre Three Gorges Dam in 2005, with
regulators unwilling to approve new construction plans amid concerns
about environmental risks and massive relocation costs.

Regulators vetoed controversial plans to dam the Nu River and the Tiger
Leaping Gorge, two ecologically fragile zones in southwestern China's
Yunnan province.

Over the 2006-2010 period, around 50 gigawatts of hydropower capacity
went into operation out of a total 77 GW originally planned, according
to Zhang Boting, vice-secretary general of the China Hydropower Society.

A cabinet session last May chaired by Premier Wen Jiabao, who has been
critical of hydropower development, also admitted the Three Gorges
project had caused serious social and environmental problems that needed
to be urgently addressed.

But with new nuclear reactor construction suspended as a result of last
year's disaster at the Fukushima plant in Japan, analysts say big hydro
is back in favour as the government tries to meet a pledge to increase
the share of non-fossil fuel energy to at least 16 percent of the total
by 2020.

China's hydropower capacity stood at 230 gigawatts by the end of 2011,
22 percent of the total, and another 55 GW are now under construction,
according to figures issued by the National Energy Administration last week.

Zhang of the China Hydropower Society said 120 GW of new hydro capacity
was likely to be built over the 2011-2015 period. ($1 = 6.3165 yuan)
(Reporting by David Stanway; Editing by Ken Wills)

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Announcement: www.worldbankpresident.org is back!

Announcement from the Bretton Woods Project: www.worldbankpresident.org
is back!

With World Bank President Robert Zoellick's term up this year and
rumours circulating that he plans to step down from the post, the
website worldbankpresident.org has been redesigned and relaunched. The
blog is dedicated to tracking the selection of the next World Bank
President and serves as a space for debate over the Bank's anachronistic
and unfair selection process and how the Bank should be reformed.

With new members in the blogging team and masses of energy,
worldbankpresident.org will continue to provide the most active forum
for democratic debate about this deeply undemocratic institution, feed
journalists tips for stories, inspire activists to ramp up their
challenges, and embolden more officials to speak out.

Everyone is welcome to get in touch with the site editor on
Also don't hesitate to get involved at

Recent posts include:

Clinton fights back?

Larry Summers? You have to be joking.

WB Presidential selection – what happens next?

Follow the blog on Twitter: @worldbankpres ; www.twitter.com/worldbankpres
Like the blog on Facebook: www.facebook.com/worldbankpresident.org

This is International Rivers' mailing list on the role of international financial institutions in promoting large dams.

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Friday, January 13, 2012

Two articles on the Yangtze River: diversions and climate change impacts

[Two articles on the Yangtze River, one on massive diversion project
known as the South-North Transfer project, and one from Nature on the
thawing permafrost at the mouth of the Yangtze and its implications for
river runoff.]

China to divert flows of its rivers
Moscow Time
12 January 2012

This year, China will spend over 10 billion U.S. dollars to divert the
flows of its rivers in the direction of the arid areas in its north.
This was announced by E Jingping, head of the South-to-North Water
Diversion Project commissioned by the State Council. It must be said in
the past few years that China has spent about 22 billion U.S. dollars on
this project, which has been compared to the Great Wall of China in

Late Chairman Mao Zedong first put forward the idea of the river
diversion project in 1951. At the time, he said that there was ample
water in the south but little in the north. It would be helpful if the
south lent some water to the north. The Water Resources Ministry took
the Chinese leader's idea as a guideline for action and embarked on a
plan to implement it. However, some time later, the Chinese leaders
shifted priorities to other projects. As a result, the process dragged
on for years. Only in 2002, after years-long droughts, the plan was
adopted. It provided for the construction of canals running along
Western, Central and Eastern routes.

As the year 2010 approached, it became clear that the project was far
from completion. The Central route which will be completed in 2014,
while the Eastern route in 2013. The work on the Western route which
involves building massive dams and tunnels has not started yet.
South-East Asian countries flatly oppose the diversion of the water from
the River Mekong, whose headstreams are located in China. The reason the
project has been put on hold is the delay in resettling 330,000 people
who live along the Central route.

"Any plan that interferes with the nature is dangerous from
environmental point of view," says head of the Yabloko Party's Greens
faction Alexei Yablokov, a Corresponding Member of the Russian Academy
of Sciences. "These plans might be effective for some time but will
produce unfavourable consequences in 20-40 years. The government will in
fact have to spend much more cash than what the project will yield the
first few years after the implementation," Alexei Yablokov said.

The head of the "Greenpeace Russia's" energy programme Vladimir Chuprov,
on his part, recalled that there was a similar project in the Soviet
Union. It was designed to fill the Aral Sea and irrigate Central Asia by
diverting water from Siberian rivers. It was not implemented because the
country broke up.

"It's very unfortunate that dozens of billions of dollars are being
spent on outdated technology, and this doesn't make sense," says
Vladimir Chuprov. "New technology would make it possible to implement
this task at a lower cost. Israel does not build canals worth billions
of dollars but water is brought directly to its plants. The U.S. is
doing the same in Arizona. China should make use of new technologies
rather than needlessly waste huge sums of money," he added.

According to Vladimir Chuprov, blocking the River Amur to build a
hydropower station would also be dangerous. Because of China's usage of
water taken from the River Argun, the border tributary of the River
Amur, the water level in the Argun River basin has fallen sharply. As a
result, the Zabaikalsky district is drying up, and the Dauria reserve is
on the brink of an environmental disaster. The common usage of water
resources in border regions should be approved by an international
commission, says the ecologist.

China's Water Resources Ministry insists that at present, 700 million
people in the country drink polluted water, and this has triggered
unrest in rural areas. After the planned diversion of water, this
problem is expected to be solved. The scale of environmental damage that
could incur is well known but this is a question of survival for a lot
of people, says the Ministry.

Meanwhile, Chinese ecologists say that large projects of this kind are a
niche for corruption. They regret the fate of the River Yangtze, which,
according to their forecasts, will dry up in 30 years.


Thawing permafrost reduces river runoff
China's Yangtze River is receiving less water as climate warms.
By Jane Qiu
6 January 2012

Chinese researchers have revealed that the amount of water entering the
Yangtze River near its source on the Tibetan plateau has fallen by 15%
over the past four decades, despite a 15% increase in glacial melt and
increased rainfall over the same period.

Wang Genxu, an ecologist at the Chengdu-based Institute of Mountain
Hazards and Environment, part of the Chinese Academy of Sciences (CAS),
says that the findings came as a surprise. "It is in contrast to results
from the Arctic where global warming has generally caused increased
river discharge," he says.

The source of the Yangtze River, on the Tibetan plateau, has been taking
in less water despite melting glaciers and increased precipitation.

Wang and his collaborators at the Cold and Arid Regions Environment and
Engineering Research Institute (CAREERI) in Lanzhou, also part of the
CAS, have just completed a five-year project to document changes in
glaciers, snow and permafrost and to assess their impact on water
resources in western China.

Ding Yongjiang, CAREERI's deputy director, notes that by contrast, many
other river systems in western China have seen more water input as
glacial retreat and rainfall have increased with a warming climate. The
runoff into the Tarim River headwaters, for instance, has increased by
13% since 1961, mainly as a result of increased glacial melt, which has
risen by 26%. "But the Yangtze headwaters are an exception," says Ding.

So why is the Yangtze different?

Permafrost puzzle

The decrease in runoff into the Yangtze is accompanied by widespread
changes in permafrost, says Wang. Across the Tibetan plateau, 10% of the
permafrost has degraded in the past decade. The area of alpine wetland
and high-vegetation-cover alpine meadow has decreased by 37% and 16%,
Related content

This prompted Wang and his colleagues to assess whether these changes
had affected the amount of water running off the land. At a research
station near Fenghuoshan Mountain in the northeast of the Tibetan
plateau, they studied how the runoff from permafrost into the Zuomaokong
River, a Yangtze tributary, is affected by air and soil temperatures,
the depth to which permafrost has thawed and the levels of vegetation cover.

The researchers found that the depth of the 'active' ground layer � the
part that freezes and thaws every year � is crucial for water passage.
Runoff increased if the thawing layer was less than 60 centimetres deep,
but decreased if the thaw went deeper. The reasons are unclear but the
researchers suspect that when more of the permafrost thaws, the
thickened active layer may act like a sponge, soaking up water that
would otherwise have run off into the river. Alternatively, more water
may leak deep into the ground, also reducing surface discharge.

The thickness of the active layer is dictated both by air temperature
and vegetation cover, especially during thawing seasons. The researchers
found that nearly twice as much heat gets into severely degraded
permafrost alpine meadow compared with healthy meadows. "So the soil is
easier to thaw and more difficult to freeze, thereby deepening the
active layer," says Wang.

Wetland degradation may be even a bigger killer of headwater discharge,
says Wang. Runoff from moderately degraded wetland was up to 40% less
than in healthy wetland.
Warm response

Wang stresses that it is still early days for this research into what is
a complicated issue, but says that "the hydrology of the Tibetan plateau
seems to be responding to a warming climate differently from the
Arctic". In central Alaska, for instance, permafrost degradation has
resulted in the expansion of wetlands, whereas on the Tibetan plateau,
it has caused the land to become drier and more prone to desertification.

Shemin Ge, a hydrogeologist at the University of Colorado in Boulder,
says that the work "highlights the complexity of permafrost hydrology
and the importance of permafrost as a headwater source".

Until recently, the role of permafrost in water resources was largely
neglected, with glaciers hogging the spotlight. "Glaciers are
spectacular and get a lot of attention, whereas permafrost is humble and
less visible," says Ge.

But permafrost constitutes up to a quarter of Earth's land surface. "It
could be just as important [as glaciers] in terms of water resources,
especially in places like the Tibetan plateau where you have a lot of it."

A better understanding of the various components of runoff processes
will help to develop permafrost hydrological models, says Wang. Such
models could then be combined with other parts of the water cycle, such
as atmospheric circulation, to predict changes in water resources.

"Being able to make accurate projections is crucial for informing
polices and mitigation measures," says Wang.

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Thursday, January 12, 2012

Ethiopia's 'grand dam' rouses citizens, dismays critics


Ethiopia's 'grand dam' rouses citizens, dismays critics
In April, Ethiopia's Prime Minister Meles Zenawi announced plans to
build Africa's largest hydropower plant along Blue Nile river. The
project is popular, but lack of transparency is a concern.

By William Davison, Correspondent / January 12, 2012

Addis Ababa, Ethiopia

In the western fringe of Ethiopia on the banks of the Blue Nile river,
the nation's Prime Minister Meles Zenawi thundered that the country
would overcome all obstacles to complete Africa's largest hydropower

"No matter how poor we are, in the Ethiopian traditions of resolve,
the Ethiopian people will pay any sacrifice," he said. "I have no
doubt they will, with one voice, say: 'Build the Dam!'"
The government portrays the dam as a 5,900-foot long, 475-foot high
beacon of progress that will banish the country's reputation for
famine and dependency. The $4.8 billion Grand Ethiopian Renaissance
Dam will lift the country out of poverty, the government argues, by
electrifying the country's industrialization and making Ethiopia a
regional power-hub - and all without a drop of the aid Ethiopia is
synonymous in the West for.

But critics worry that the country may have taken self-sufficiency and
ambition a bit too far in the way it pushed ahead with its largest-
ever project unilaterally and with little transparent planning.

Secrecy has shrouded the 5,250-megawatt plant, nearly 20 miles from
the Sudanese border. Although the site was identified in 1964, the
decision to go ahead with what had been known as Project X became
public less than a month before construction began on April 2.

Its unveiling shocked a host of interested parties.

At a launch in Addis Ababa, the Egyptian embassy's spokesman was
astonished to learn a reservoir more than twice the size of Singapore
would be created by a barrage Cairo had not been consulted on. Over
four-fifths of the water for the Nile, Egypt's lifeblood, comes from
Ethiopia's highlands, leading to historic tensions over usage.

Also uninformed was the Eastern Africa Power Pool, which was just
putting the finishing touches on a regional integration study that
leans heavily on exported Ethiopian hydropower. "We look forward to
getting more information so we can factor it into our master plan,�
Jasper Oduor, its Executive Secretary, said.

Similarly, the unilateral move was a blow to the Nile Basin
Initiative, which is supposed to establish cooperative management of
the river, and Norwegian consultants whose ongoing studies on a
potential cascade of Blue Nile dams were rendered obsolete by the

The covert approach may have had the twin purposes of minimizing
foreign opposition to the scheme while maximizing the impact of its
announcement on Ethiopians - if so, it seems to be working.

Since Meles' speech, the public has been bombarded with
advertisements, posters, reports, and speeches about the dam, as the
state sells bonds to partially fund it. Most of a patriotic citizenry,
who consider Egypt's domination of the Nile an acute injustice,
approve of the scheme - even opposition politicians.

"We need this resource to lift people out of the abject poverty we
have been wallowing in for centuries,� former member of parliament
Temesgen Zewdie says. �There�s no question it�s an idea the Ethiopian
people support.�

The popular cause combined with the ruling party's extensive influence
- around 1 in every 17 Ethiopians is a member - has made for a highly-
effective fundraising campaign. Often following a collective decision
at staff meetings, public and private sector workers have bought
bonds, taking the total raised to 7 billion Ethiopian birr ($408
million) in September, according to Bereket Simon, a longstanding ally
of Meles and co-head of a GERD Public Mobilization Council.

Some, such as former president and leading opponent of the government
Negasso Gidada, say the hype and pressure of the campaign makes it
very difficult for people to opt out. However, the attitude of a lady
selling a handful of vegetables on the streets of one of Addis Ababa's
most dilapidated districts is typical: "I would give more money if
could afford to." So far, she has donated 30 birr (equivalent to $1.73).

The populist approach may alarm Western liberals, but unity in pursuit
of national goals is key to Meles' "developmental state."

The bond-buying will also foster a savings culture, Bereket hopes. At
less than 10 percent of gross domestic product, national savings are
under half the rate that funded the investment of much-admired Asian

So far, no friction with the two downstream nations, Sudan and Egypt,
has resulted. A joint committee between the three countries has been
set up to study the dam, which Ethiopia insists will benefit all by
generating electricity for the region and reducing evaporation due to
its deep, elevated reservoir. Indeed, such are the mutual gains,
Sudan and Egypt should rightfully cover half the costs of the project,
Meles believes. Despite the cordiality, given the political
instability in Khartoum and Cairo, relations could rapidly deteriorate.

The Grand Ethiopian Renaissance Dam also has its detractors and dangers.

The Economist claims a flaw is that export deals have not been struck.
However, links with Djibouti, Sudan, and Kenya are complete or
underway, and the dam's scheduled 2017 completion date gives the power
pool time to advance regional integration.

Also of concern is whether the government will conduct thorough
technical studies and environment and social impact assessments.
Institutions like the World Bank require them. But government
supporters consider these types of activities unacceptable conditions
imposed by a hypocritical, carbon-emitting West - not responsible due
diligence. Unconditional Chinese funds are much-preferred.

Although the desire to be unshackled is admirable, the impatience
could be costly. At the GERD site buzzing with construction activity
in late June - 3 months into the project - an Italian engineer
explained his team were surveying the rock edifices the dam will bind
to. Yes, it was possible they would be found unsuitable, he casually

For International Rivers, which works "to stop destructive dams," the
project is following worst international practice. "No-bid contract,
an air of secrecy, and repression of debate. Such a flawed planning
process could doom the project from the start," says its Africa
campaigner Lori Pottinger.

There's also concern about how the country will pay for the dam given
it will cost around 70 percent of this year's government budget.
Optimists such as Ernst and Young's Zemedeneh Negatu say continued
double-digit economic growth will make it affordable. Private banks,
which have been forced to lend to the government for development
projects, will be an important source of funds.

But the former World Bank country director Ken Ohashi says a need for
foreign loans to finance Ethiopia's ambitious infrastructure projects
could lead to debt problems. To the guffaws of a parliament containing
one opposition member, Meles dismissed the concerns as the parting
shot of a disgruntled neo-liberal.

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Rivers must flow: The case against big dams


Rivers must flow: The case against big dams
Large dams threaten the planet's riverine lifelines and action must be
taken soon.

10 Jan 2012

By Lori Pottinger

Berkeley, CA - Rivers act as the planet's circulatory system. Like our
body's circulation system, the planetary one doesn't work very well
when it's clogged. If a river's flow is its heartbeat, then we humans
are the heart disease. We've blocked most major rivers with dams, bled
them dry with water diversions, and given up all too many once-great
rivers for dead once we've used them up.

More than 50,000 large dams now choke about two-thirds of the world's
largest rivers. The consequences of this massive engineering programme
have been devastating. Large dams have wiped out species; flooded huge
areas of wetlands, forests and farmlands; displaced tens of millions
of people, and affected close to half a billion people living

Large dams hold back not just water, but silt and nutrients that
replenish farmlands and build protective wetlands and beaches. Dams
change the very riverness of our waterways, in ways we can't always
see, but that the earth can certainly feel.
US dam removed to check salmon decline

Of all the complex and interconnected environmental disruptions that
dams inflict on the landscape, the most obvious is the permanent
inundation of forests, wetlands and wildlife. Reservoirs have flooded
vast areas - at last count, the world's dams had flooded an area
bigger than the United Kingdom.

Equally important is the quality of these lost lands: river and
floodplain habitats are some of the world's most diverse ecosystems.
Plants and animals that are closely adapted to valley habitats often
cannot survive along the edge of a reservoir.

Dams also are usually built in remote areas that are the last refuge
for species displaced by development elsewhere. In large measure due
to dams, freshwater ecosystems are losing species and habitats faster
than any other type of ecosystem.

Large dams also fragment the riverine ecosystem, isolating populations
of species living up and downstream of the dam and cutting off
migrations and other movements. Because almost all dams reduce normal
flooding, they also fragment ecosystems by isolating the river from
its floodplain. The elimination of the benefits provided by natural
flooding may be the single most ecologically damaging impact of a dam.

Rivers that capture carbon

A newly significant environmental impact of dams is how they might
eliminate a source of carbon capture in some watersheds. Scientists
have discovered that major rivers play a surprisingly large role in
helping tropical oceans absorb carbon.

The vast flow of major river basins delivers phosphorus, iron and
other nutrients far offshore, where it is consumed by certain forms of
sea life such as phytoplankton. These microorganisms "fix" carbon by
taking it out of the atmosphere. The organisms eventually sink, taking
carbon with them to the deep seafloor. Dams could change the delicate
workings of this ecosystem service by holding back the river-borne
sediment that feeds this cycle.

At least two major river basins slated for damming - the Amazon and
the Congo - are important planetary sources of nutrient flows. A 2009
study of Africa's biggest proposed hydropower project, the Grand Inga
Complex on the Congo, says that "plans to divert, store or otherwise
intervene in Lower Congo River dynamics are truly alarming" and
"ignore the river's significant influence on the equatorial Atlantic,
which, in turn, is central to many climate change models".

Scientists predict that damming the Amazon, the Congo, the Mekong and
other high flow rivers in warm ocean areas could reduce their ability
to mitigate climate change. Research on other rivers' carbon-sink
capacity is underway.

What can be done?

"Free-flowing rivers are now such a rarity that they would be
classified as an endangered species if they were considered living
things rather than merely the support systems for all living things."

- Lori Pottinger

Free-flowing rivers are now such a rarity that they would be
classified as an endangered species if they were considered living
things rather than merely the support systems for all living things.
Yet we can take small comfort from the fact that rivers have a natural
ability to self-heal.

Over time, all of the efforts to engineer dynamic, powerful and
unpredictable rivers will inevitably fail, and the river will have a
chance to restore itself. As renowned river explorer Richard Bangs
wrote in his book River Gods, "Wild rivers are earth's renegades,
defying gravity, dancing to their own tunes, resisting the authority
of humans, always chipping away, and eventually always winning." We
all win when rivers are allowed to flow freely.

But we can't just wait for rivers to chip away at the dams that clog
them. First, we need to protect remaining free-flowing rivers while we
still have some to protect. A growing movement of citizen activists in
countries where damming is on the rise is working to get governments
to pass laws that would protect free-flowing rivers. A number of
countries have devised legislative tools that are useful models for
such efforts; the US Wild and Scenic Rivers Act is just one effective

Where entire rivers cannot be protected, we must prioritise the
protection of areas of great ecological integrity. This "landscape
approach" requires that a network of regional-scale ecosystems be
protected; that sufficient levels of each ecosystem are included to
make protected areas ecologically viable and to maintain the integrity
of populations, species and communities, and that the protected areas
encompass variability of habitat within ecosystems.

The biggest challenge is not the science of evaluating what to save,
but generating the political will needed to maintain the protections.

When rivers are dammed, we must insist on naturalistic flows to
support the basic ecosystem functions of dammed rivers. So-called
"environmental flows" are planned releases intended to support the
basic ecosystem functions of dammed rivers. Such systems can be
complex to devise and maintain, and many dams around the world
currently lack the mechanisms needed to control water discharge.
Therefore, as with medicine, the best approach is to "first, do no
harm" - no dams unless there are no better options (and there almost
always are).

But once a dam is inevitable, it is imperative that the river be
maintained with as natural a flow as possible. As water expert Sandra
Postel has written, "an ethic of stewardship toward fresh water and
its dependent species requires that we err on the side of allocating
too much water to ecosystems rather than too little."

And finally, we must remove the worst dams to restore flows that
support habitats, fisheries and other natural services lost to poorly
planned dams. A growing movement to remove dams and restore rivers in
the United States is a global inspiration. American Rivers estimates
that more than 925 dams have been removed over the past 100 years in
the US.

We must also undertake a greater study of the world's river-dependent
biodiversity, much of which still remains unknown to us. As Pulitzer-
prize-winning biologist EO Wilson has said:

In reality, we don't know 90 per cent of what we're losing,
because we've only discovered about ten per cent of the planet's
species. When we're trying to stabilise the environment - trying to
stop ecosystems from collapsing in the face of global warming or big
dams or whatever - we really need to know what's in each of these
habitats. We need then to move ecology way ahead of where it is today,
really make it a much bigger priority.

Chileans mobilise against proposed dam

Because most new dams are being built in the global south, we must
move more quickly to help the developing world adopt clean energy and
water supply systems that preserve riverine lifelines. Large dams are
an ineffective approach for solving the water and energy needs of the
poor majority. Small projects take less time to build, are more easily
phased, and are more adaptable to a changing climate.

Breakthroughs in clean energy technologies and water-efficiency
methods are not only better suited to strengthen energy and water
access for the poor, they will also strengthen our resilience to
climate change. They do, however, require greater investment in
research, development and deployment.

The world's wealthiest countries should assist the world's poorest in
developing a cleaner, more efficient energy path and water-secure
future rather than in destructive mega-projects that repeat the
mistakes of the past.

The final piece of the puzzle is personal. Protecting our rivers now
is the health insurance policy we all need for a climate-challenged
future. Finding ways to become an advocate for a river near you in
2012 would be a good way to celebrate the new year.

Lori Pottinger has worked for the California-based International
Rivers for 17 years. She works on African river issues, and is the
editor of the group's magazine, World Rivers Review.

The views expressed in this article are the author's own and do not
necessarily reflect Al Jazeera's editorial policy.
Al Jazeera

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Wednesday, January 11, 2012

China vows backing for firms investing abroad


China vows backing for firms investing abroad
Updated: 2012-01-06
By Hu Yinan and Zhang Yunbi (China Daily)

The suspension of a $3.6 billion joint hydropower project in Myanmar in
September has sent alarming signals to Chinese companies investing in
emerging markets, said Luo Zhaohui, director-general of the Asia
Department of the Foreign Ministry.

Beijing will boost political diplomatic backing for its companies
overseas, particularly in Asia, the most preferred and concentrated
destination of Chinese investment, Luo said during an online interview
on Thursday.

By the end of 2010, 71.9 percent of China's foreign direct investment,
which totaled $300 billion, was based in Asia, official figures showed.

"As the scope of these companies broadens, the risks and challenges they
face, such as shifts in political affairs, disruption by external
factors and a lack of experience in operating internationally, are
rising as well," said Luo, a former ambassador to Pakistan.

Thursday's interview, the first in a series with a dozen senior Chinese
diplomats, was co-hosted by websites of People's Daily, China Daily,
China News Service and the Foreign Ministry.

Myanmar President Thein Sein's sudden suspension of the Myitsone
hydropower plant, a project both sides agreed upon in 2006, on Sept 30,
came as a surprise to many. The country's foreign minister and
vice-president paid consecutive visits to China to hold consultations in
the wake of the incident.

The two countries are still in the process of properly resolving the
issue, Luo said, adding that China supports reconciliation efforts by
the Myanmar government and is willing to see its relations improve with
Western countries.

Yang Baoyun, a professor of Asian studies at Peking University, said
State-owned companies should "be more cautious" in investing overseas.

"The overseas operation of large State-owned enterprises serves as a
component of public diplomacy," he said. State-owned China Power
Investment is Myitsone's largest investor.

At the diplomatic level, Luo said Beijing is calling on relevant
countries to ease sanctions against Myanmar to facilitate the stability
and development of the country.

William Hague on Thursday became the first UK foreign secretary to visit
Myanmar since 1955. His visit came three months before the European
Union is scheduled to hold its annual sanctions review, and followed an
unprecedented visit to Myanmar by US Secretary of State Hillary Clinton
in early December.

US billionaire investor George Soros recently wrapped up a weeklong trip
to Myanmar, during which he met President Thein Sein and Aung San Suu
Kyi, leader of the National League for Democracy.

In Beijing, Luo said the US' increasing strategic input in the
Asia-Pacific is testament to the vitality, potential and growing
significance of the region.

China is "fully capable of well managing its surroundings", he said.

Dismissing concerns of potential clashes as Washington's interests in
Asia come to intersect with those of Beijing, Luo said Sino-US
cooperation in the Asia-Pacific is the common aspiration of all
countries in the region.

China respects the legitimate interests of the United States in the
Asia-Pacific, welcomes the US to play a constructive role in regional
affairs and urges it to "respect Asian characteristics, respect the
Asian model and respect the interests of relevant parties", Luo said.

Beijing will be neither provocative nor afraid of tackling issues, he added.

"We're clear on where the bottom line of our interests is," said Luo.

He added: "We disagree with the concept of zero-sum games, and are not
of the view that a rising nation will necessarily collide with an
existing power. China is on the path of peaceful development, a path
that we chose ourselves."

Shi Yinhong, a researcher at the China Institute of International
Studies, said this reflects what President Hu Jintao told his US
counterpart Barack Obama in November - that he hopes Washington, too,
can respect China's legitimate interests in the Asia-Pacific.

China Daily

This is International Rivers' mailing list on China's global footprint, and particularly Chinese investment in
international dam projects.

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Tuesday, January 10, 2012

Rivers must flow: The case against big dams/Al Jazeera

Rivers must flow: The case against big dams
Large dams threaten the planet's riverine lifelines and action must be
taken soon.

Rivers act as the planet's circulatory system. Like our body's
circulation system, the planetary one doesn't work very well when it's
clogged. If a river's flow is its heartbeat, then we humans are the
heart disease. We've blocked most major rivers with dams, bled them
dry with water diversions, and given up all too many once-great rivers
for dead once we've used them up.

Free-flowing rivers are now such a rarity that they would be
classified as an endangered species if they were considered living
things rather than merely the support systems for all living things.
We can take small comfort from the fact that rivers have a natural
ability to self-heal � but we can't just wait for rivers to chip away
at the dams that clog them. First, we need to protect remaining free-
flowing rivers while we still have some to protect.

(Learn more about what we must do to protect rivers, and why. Read the
full article on Al Jazeera:

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Monday, January 9, 2012

Uganda ignores donor concerns on Karuma

(The GoU is apparently claiming this new dam on the Nile could produce
more energy than some donors believe is possible. The new Bujagali Dam
was also "oversold"--as a 250MW project, when in reality it is
expected to produce much less... see for example http://allafrica.com/stories/201111030117.html)


Uganda ignores donor concerns on Karuma


Posted Sunday, January 8 2012 at 14:21

East-West rivalry is emerging as a possible factor in the controversy
surrounding the sizing of Uganda�s 660MW Karuma power project, which
Western donors want built at a much lower rating of 450MW.

Speaking off the record about a debate that has seen donors argue that
the power project is oversized relative to the available stream and
the excess capacity is a wastage of scarce resources, Ugandan
officials now suspect Western opposition to the project could be
motivated by the role Chinese finance and civil contractors are likely
to play in the project.

Ignoring donors who argue that the proposed capacity will be available
only partially during the year, Uganda will this month proceed to
receive bids for the power station, which it urgently needs to bridge
a rapidly growing energy gap.

Uganda is apparently sticking to its guns because � in a departure
from previous power projects, where it has had to deal with donors
from project design to financing, � the country will go it alone this
time, building the power station from its own resources and financing
from friendlier partners.

The turnkey project will be funded by the government while Scandinavia
is the preferred technology source.

With only 9 per cent of its population connected to the power grid,
Uganda still has an official supply gap of 130MW. With demand
increasing by 40MW annually and the economy expected to grow at an
average of 5.5 per cent over the next five years, experts say power
supply will still be chasing demand even if the new power station were
to deliver to its design specification.

Consumers now have to endure 12 hours of power rationing at a time as
contracts for thermal generation tail off in anticipation of the 250MW
power station, which is running a year behind schedule.
Now a permanent feature of Uganda�s energy mix, accounting for up to
30 per cent of available energy, thermal electricity has seen the
domestic tariff rise to Ush426 ($0.21).

Given the initial investment cost for new power projects as well as
the proposed removal of a government subsidy that would see the
consumer tariff double, new hydro capacity is not expected to bring
about a reduction of tariffs in the short to mid-term.

Ministry of Energy officials said the controversial 660MW installed
capacity is at optimum usage. However, they conceded that the 700MW
initially proposed was not sustainable in the long run, but insisted
the 400-450MW that the donor community proposed is not supported from
a technical point of view.

Echoing his permanent secretary, who in an earlier interview told this
newspaper that donor concerns were not informed by feasibility
studies, Henry Bidasala, Assistant Commissioner of the Electrical
Power Division in the Ministry of Energy and Mineral Development,
commented: �We had a presentation by the contractor who did the
feasibility study and the energy donor technical team in attendance
asked all the questions they wanted and seemed okay with it.�

Energy Infratech Pvt Ltd of India carried out the feasibility study
and environmental impact assessment in 2010.

Energy Permanent Secretary Fred Kabagambe Kaliisa had earlier argued
that even if 450 or 500MW were the target generation output, it made
sense to factor in redundancy to assure constant supply at those times
when some units have to be shut down for maintenance.

National Planning Authority officials said Uganda needs to increase
its power generation capacity to 3,500 MW by 2015 as the country
experiences a steadily rising population and economic expansion.
According to the Electricity Regulatory Authority, demand has been
growing by nine per cent per annum since 2009. This translates into an
increase of 40MW per annum.

An independent source said whatever decisions the technocrats were
making in respect of Karuma were feasible and the donor community are
only crying foul because of the possible participation of China and
its rising profile in other projects in Africa.

The donors, led by key financier KfW, at one time said they would
engage a new firm to do an independent feasibility study, but have yet
to do so.

The source said without a new feasibility study, the donors are still
referring to the Norwegian consortium Norpak Power Ltd study that had
developed a �conservative design� in the mid-1990s, informed by the
notion that there was low demand for electricity in Uganda.

Keith Muhakanizi, Deputy Secretary to the Treasury, said the projected
cost would be lower than the initial estimates of $2.2 billion because
of a �new approach.�

Initial design proposals suggest a dam with a headrace, tailrace and
an underground facility housing 6 turbines each with nominal rating of
100MW and a spinning reserve of 10 MW.

It will be located about 3km upstream of Karuma Bridge and 80km
downstream of Lake Kyoga on the River Nile.

Construction of the project will be supervised and managed by the
Uganda Electricity Generation Company, the government nominee and
licensee of the project.

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Thursday, January 5, 2012

Grand Ethiopian Renaissance Dam: Egypt’s enemy or a blessing in disguise?

(Note that those who see the giant dam as a way to induce cooperation
over the Nile are ignoring the fact that the giant dam will do more
than just regulate water flow--it will also change flood patterns, the
chemistry of the river, reduce silts, etc.--all of which are as
serious to the longterm health of the river as the changes in water


Grand Ethiopian Renaissance Dam: Egypt�s enemy or a blessing in

Steven Viney

Thu, 05/01/2012 - 10:59

Preliminary construction of the Grand Ethiopian Renaissance Dam (GRD)
began in April 2011 on the Blue Nile River near the Sudanese border.
Scheduled for completion in 2014, it is planned to be the biggest
hydropower dam in Africa, with more than twice the generating capacity
of the Aswan High Dam. But long before the completion date, the
project is already generating significant concern amongst the nine
other countries that share the Nile, especially Egypt.
Over the past century many treaties have been signed in an attempt to
assure each riparian country a right to Nile water, with Egypt
generally receiving the lion�s share. But sub-Saharan African
counties have long argued that the old treaties deny their modern
right to livelihood, and after a decade of political to-and-fro
between these countries and Egypt, the GRD is now underway.

Most recently, the Egyptian government protested that no quantitative
studies have been conducted with regard to the dam�s effects, a
complaint that resulted in a trilateral ministerial meeting being held
in November between Ethiopia, Egypt and Sudan. During this meeting,
it was announced that an independent technical committee of experts
from each country would be formed in six months time to produce such a

But at the same meeting, Alemayehu Tegenu, the Ethiopian minister of
water and energy, declared that regardless of the study�s outcome, the
construction of the dam will continue unabated due to high confidence
that the GRD will ultimately benefit all parties.

Adel Darwish, a British journalist and historian who co-wrote the 1994
book �Water Wars: Coming Conflicts in the Middle East,� told Egypt
Independent that Egypt never should have ruled out the option of
military intervention, because the stakes are so high for the
country�s livelihood.

While Egypt Waits

Various experts have recently shared with Egypt Independent their own
input on the potential pros and cons of the GRD.

Sherine al-Baradei, an AUC professor in the department of construction
and architectural engineering with a focus on hydraulics, points out a
number of major issues with the dam.

�Obviously, dams provide both good and bad effects,� she says. �But
with Egypt being so dependent on the Nile, serious agreements must be
made to ensure that the bad effects are minimized, and in advance.�

According to Baradei, hydropower dams create immense turbulence in the
water, where chemical reactions such as dissolved oxygen can destroy
fauna and flora. While the water will return to its normal state
before reaching Egypt, the damage to these populations will be
permanent. In addition, many nutrients and silt, which are essential
for agriculture, will be retained in the large dam.

�When the Aswan High Dam was built, farmers, fisheries and many others
were seriously affected for decades by the lowering of nutrients,
silt, flora and fauna in the water,� she says.

Baradei explains that these levels will certainly drop further with
the GRD, not to mention many other unforeseen problems that will
likely occur.

Perhaps the most significant concern is that Egypt may no longer
receive its appropriate share of water. But according to Baradei,
issues of water regulation can be solved through negotiations with
Ethiopia, whereas there is no solution for the loss of flora and fauna.

The Nile Basin Core Group (NBCG), a team of Nile specialists, has a
more positive analysis of the situation. In their view, the GRD is an
opportunity to create strong ties between Egypt and sub-Saharan
countries, and there may also be many positive effects of the dam.

�The right question is not what the effects of the GRD will be, but
how the Nile basin�s water can be used to integrate all riparian
countries in a stable and efficient way,� says Mohamed al-Mongy, an
environmental development specialist from the NBCG. �Instead of
looking North, East and West for our solutions, we need to begin
looking South, where the source of our livelihood lies.�

One of Mongy�s colleagues at NBCG, Haytham Awad, a hydrologist from
the University of Alexandria, has conducted research that indicates
the GRD may actually increase water flow to Egypt.

Awad�s research shows that during the flood season in late August and
early September, the majority of Egypt�s water arrives in Lake Nasser,
where it is stored for approximately ten months until peak agriculture
season in July the following year. During this period, approximately
twelve percent of the stored water evaporates.

However, with the water being stored in the GRD, where there will be
less evaporation and that will help conserve water.

Another finding is that the GRD is expected to produce power surpluses
which, assuming cooperation, could be exported to Egypt, leading to
strengthened ties between the two countries.

�Collaboration is key,� says Lama El Hatow, a member of the NBCG doing
her PhD research on water governance of the Nile basin. �When we
negotiate with the riparian states, it is vital that we understand all
the facts and science holistically.

�Good science should lead to the right political negotiations, as
opposed to jumping to haphazard conclusions based on partial
understandings that may lead to Egypt�s own detriment,� she concludes.

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Justice delayed 30 years in Guatemala [Al-Jazeera, 04.01.12]

Justice delayed 30 years in Guatemala

Over 440 men, women and children were massacred to make way for the Chixoy Dam - a World Bank and IADB project.
Last Modified: 04 Jan 2012 12:38

Springfield, Massachusetts - On the morning of March 13, 1982, 10-year-old orphan Jesus Tecu Osorio woke up in his rural Maya Achi village of Rio Negro, Guatemala, with the crushing burden of satisfying the most basic needs of survival for himself and his siblings. A month earlier, his parents, along with 70 other Rio Negro villagers, were killed by Guatemalan soldiers and civil defence patrollers from the neighbouring village of Xococ. 

By the end of that harrowing day, Jesus had witnessed the brutal slaughter of 177 women and children. Jesus was "spared" to serve as a conscripted servant for one of the paramilitary members who massacred his community, including his two-year-old brother who was yanked from his arms, garroted and smashed into rocks as Jesus watched in horror.

In 1982, over 440 men, women and children from Rio Negro were killed, in large part to make way for the Chixoy Hydroelectric Dam, a project of the World Bank and the Inter-American Development Bank (IADB).

The Rio Negro massacres were among hundreds committed during Guatemala's internal conflict, in which the majority of over 200,000 Guatemalans killed or disappeared by the military regimes were unarmed indigenous Mayan civilians. The United Nations-sponsored Truth Commission concluded that in certain Mayan regions, including the Chixoy Dam area, the Guatemalan government committed genocide.

The Rio Negro massacres were emblematic of the forces that left Guatemalan civilians at the mercy of their entrenched oligarchy and powerful military (which received training in ruthless counter-insurgency techniques at the US Army School of the Americas), and a range of external actors, including wealthy nation governments, multinational corporations and international financial institutions.

Resistance is futile

The World Bank and IADB are constituted as development institutions that invest in projects to aid economic growth in the global south. From 1975-1985, the World Bank and the IADB loaned US $292m to successive Western-backed military regimes in Guatemala to finance the Chixoy Dam. Consistent with their operational protocols, the World Bank and IADB assigned full-time staff to provide constant project management and oversight.

The US possesses the highest percentage of World Bank voting shares, over 16 per cent, which combined with the shares held by Western Europe and Japan (which routinely vote with the US) comprises a majority of votes. Given this allocation of power, the World Bank's policies often reflect the economic priorities of the wealthier donor governments and not necessarily those favoured by the poor recipient communities in which the projects are based.

Among the 32 communities along the river slated for forced resettlement, the village of Rio Negro opposed the plan most vigorously, a principled resistance for which they paid an unconscionable price. Impatient with unsuccessful efforts to threaten and intimidate the villagers into involuntary departure, the regime settled on a brutally effective relocation strategy - emptying the community through the systematic massacre of its inhabitants.

By 1977, Amnesty International was reporting on systemic human rights abuses in Guatemala. The United Nations, Organisation of American States and numerous non-governmental organisations subsequently documented that the state was committing atrocities associated with the Chixoy Dam, well prior to its completion.

Despite credible evidence of egregious human rights abuses, the banks continued their unconditional support for the project. The World Bank made its final investment in the project in 1985, long after the massacres silenced the village of Rio Negro. At best, the banks were willfully and intentionally blind to state repression before, during and after the project; at worst, they were complicit in these atrocities.

Justice for Jesus?

The 30-year anniversary of the Rio Negro massacre approaches, yet there has been no justice for the victims and survivors of these atrocities: no reparations for the destruction of communities, nor for the loss of cultural artifacts, homes, property and livelihoods. While justice is elusive for the victims, impunity prevails for those who perpetrated these wrongs.   

Today, the Chixoy Dam-harmed communities, both down and up-river from the dam wall, are worse off than before the project. Communities dispersed by the dam construction subsist in varying conditions of poverty, violence and impunity that result directly and indirectly from the forced evictions, loss of ancestral lands and riparian way of life, separation from longstanding community support and inadequate access to water caused by the Chixoy Dam project. Environmental damage continues unchecked.

After decades of struggling for justice, advocates filed a petition seeking just and fair reparations for the people of Rio Negro in the Inter-American Commission on Human Rights. The petition was summarily denied, and has been recently appealed. The international community's moral outrage about the role of international financial actors in the Rio Negro massacre and the demand for justice are long overdue.

In response to significant criticism for the deleterious environmental and social impacts of major hydroelectric dam construction during the 1990s, including atrocities associated with the Chixoy Dam, the World Bank began backing away from funding these projects. Recently however, the World Bank has announced a new policy to increase its commitment to financing hydroelectric projects.

Despite the history of human rights abuses and poorly administered forcible displacements associated with its various hydroelectric projects, the World Bank has argued that its Articles of Agreement, which predated various human rights instruments, does not require consideration of human rights in its funding decisions.

The World Bank is currently undergoing a safeguard policy review process. This process provides the bank an opportunity to adopt a rights-based approach to ensure that future projects comport with international law standards. Particular care must be taken while making decisions that affect tribal communities that continue to be threatened by hydroelectric projects, including those in Brazil, Peru, Guyana, Ethiopia and Malaysia. As required under international law, these projects must be accompanied by procedures that ensure the informed consent, participation and protection of dam-affected communities.

The World Bank must be held to account for the realisation of its core mission: the alleviation of poverty and sustainable development for marginalised communities. As a matter of justice, the World Bank and IADB must own up to their responsibility and provide their share of reparations to the communities that were irreparably harmed by the Chixoy Dam project, they were instrumental in funding. Prospectively, the banks must develop safeguards that ensure that all future projects comport with both their mission and with international human rights standards.

Jesus Tecu Osorio, and the children he is determined to raise near his once thriving ancestral community of Rio Negro deserve nothing less.

Lauren Carasik is a Clinical Professor of Law and the Director of the International Human Rights Clinic and the Legal services Clinic at Western New England University School of Law.

Grahame Russell is a human rights lawyer and co-director of Rights Action, a Canadian NGO engaged in community development, environment and human rights work throughout Central America.

The views expressed in this article are the authors' own and do not necessarily reflect Al Jazeera's editorial policy.