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Myanmar says no to Chinese dam

world Updated: Nov 09, 2011 01:04 IST
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After five years of cosy cooperation with Burma's ruling generals, China Power Investment Corp got a shock in September when it sent a senior executive to Naypyidaw, the destitute Southeast Asian nation's showcase capital, a Pharaonic sprawl of empty eight-lane highways and cavernous government buildings.

Armed with a slick PowerPoint presentation and promises of $20 billion in investment, Li Guanghua pitched "an excellent opportunity", a mammoth, Chinese-funded hydropower project in Burma's far north.

Then came the questions: What about the risk of earthquakes, ecological damage and all the people whose homes would be flooded? Is it true that most of the electricity would go to China?

Two weeks later, Burma, also known as Myanmar, scrapped the cornerstone of the project. President Thein Sein, a former general who took office in March, announced that he had to "respect the people's will" and halt the $3.6 billion dam project at Myitsone, the biggest of seven planned by China Power Investment, or CPI.

As the world's biggest consumer of energy, China has hunted far and wide in recent years for sources of power - and of profit - for state-owned corporate behemoths such as CPI. The result is a web of deals with often-repressive regimes, from oil-rich African autocracies such as Sudan and Angola to river-rich Burma. But cosiness with despots can also backfire.

Amid a dramatic, though still fitful, opening in Burma after decades of harsh repression, public anger has swamped China's hydropower plan.

The deluge threatens not only hundreds of millions of dollars already spent, but also China's intimate ties to what had been a reliably authoritarian partner, its only East Asian ally other than North Korea.

Beijing still has big interests in Burma, including a multibillion-dollar oil and natural gas pipeline that is under construction. But a partnership forged with scant heed to public opinion has been badly jolted by a barrage of no-longer-taboo questions.

CPI "thought that making an agreement with the regime is good enough. They don't realize that the circumstances have changed," said Ko Tar, a Burmese writer and anti-dam activist who travelled to Myitsone early this year. He has since rallied opposition to a project that he says shows China is "only concerned with its own energy needs, not with Burma's ecological needs."

China's overseas ventures
China has plenty of rivers itself and is the world's largest producer of hydroelectric power, which accounts for about 16% of its electricity and 7% of its total energy consumption. It plans to increase hydro-generating capacity by nearly two-thirds over the next five years.

But under pressure from environmentalists at home and crimped by new legislation, China's dam-builders have in recent years also looked to rivers abroad. They are constructing about 300 dams overseas.

Most of these will not help China meet its energy needs: They are too far away, in places such as Ethiopia and Sudan. But Chinese-built dams in Laos and especially Burma will pump electricity into China's power grid.

Across the border
China's consumption of electricity has increased more than tenfold since 1980, when the Communist Party was just beginning to dismantle a Soviet-style command economy, and is second only to that of the US. In 2000, with demand for power surging along China's east coast, Beijing launched a policy known as "sending electricity from west to east," pushing for new dams on rivers in Tibet, Sichuan and Yunnan, the Chinese province next to Burma.

China's powerful hydro­power lobby argued that dams also offered a clean way to reduce the nation's dependency on power plants fired by carbon-belching coal, which generate about three-quarters of China's electricity.

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