By Melody Kemp
One of the first indications that change was afoot in Myanmar came when President Thein Sein announced last year the suspension of the China-backed, US$3.6 billion Myitsone dam slated for the country's remote Kachin state. Now, signs are that the fight is not over as Chinese hydro-power lobbyists go on the offensive to have the mega-project restarted despite extreme environmental risks.
A PowerPoint presentation made by a delegate to the recent Mekong Energy and Ecology meeting in Bangkok indicates that China's hydro-power industry is working hard to resurrect the shelved project. The presentation along with other Chinese-language documents indicate that China wants to resurrect the project as a symbol of its still strong clout in Myanmar at a time the United States and European Union bid to make diplomatic and commercial inroads.
The Myitsone dam is also apparently viewed by Beijing as a bellwether on Myanmar's stance on other major Chinese investments, including the $17.5 billion oil and gas pipelines designed to transport fuel from Myanmar's southern coast to China's southwestern, land-locked Yunnan province.
The Chinese press have reported the pipelines create 50,000 new jobs and yield Yunnan economic returns estimated at 33 billion yuan (US$5.2 billion) in refined products per year. The pipelines will also allow China to avoid sending its energy imports through the congested and, in case of a future conflict with the United States, easily blocked Malacca Straits.
The Chinese Hydropower Association, government officials and Chinese media have all accused Myanmar's government of breach of contract and of being in the thrall of foreign, read Western, non-governmental organizations that have campaigned steadily against the mega-project's potential negative environmental and social impacts.
Chinese officials have asserted that Myanmar needs China's foreign investment, which currently amounts to over 44% of the country's foreign direct investment, to fuel economic development. However, 90% of the estimated 3,600-6,000 megawatts of electricity that would have been generated by the dam was slated for export to China.
Chinese hydropower interests, meanwhile, continue to assert that the environmental impacts of the dam would be minimal. That is the portrait painted by the upstream Ayeyawady Confluence Basin Hydropower Corporation, a local subsidiary of the China Power Investment Corporation, one of China's top five electricity producers, in their latest publication "A Better Tomorrow on the Ayeyawady River."
Zhang Boting, deputy secretary general of the Chinese Society for Hydropower Engineering and who writes for the government's mouthpiece People's Daily newspaper, has led the propaganda offensive against Myitsone's suspension. In a recent newspaper column he referred to Thein Sein's safety concerns over the project as "“illogical".
"Will the natural beauty of Kachin and Myanmar be destroyed by the project? Absolutely NOT - dams and even earthquakes have been proven to create new beautiful scenery. This is the case with [China's] Three River Gorges Dam, which is now more beautiful than before. Don't listen to the extreme statements of environmentalists," he urged Thein Sein in a newspaper column.
Striking a more assertive pose, he also recently wrote: "It is impossible that the investor move the hydropower projects out of Myanmar ... If the Myanmar people are at risk, the investment by the investor is at risk as well. The investor and the Myanmar people are both stakeholders in dam construction."
"Will the reservoir cause people upstream to lose livelihoods? ... As a World Bank official once learned in China, many people hope that they will be lucky enough to be resettled as a result of a dam project ... as this is a way out of poverty," Zhang's China Society for Hydropower recently said in a statement.
"The people who designed the Myitsone are the same that designed the Three River Gorges Dam - for them resolving resettlement issues are very simple. The people living in the [Myitsone] resettlement area now live like people in upscale villas in China," the statement said.
World Bank officials could not confirm the anonymous quote attributed to it in Zhang's statement. Nor have those resettled from the Myitsone dam site been resettled into "upscale villas", as he claimed. Photographs and reports received by this correspondent indicate that most of the resettled villagers - estimated by the opposition National League for Democracy to number 12,000 - have been forced off their fertile ancestral lands and lucrative orchards into tiny houses on clay beds incapable of producing basic crops.
Dam high risks
The environmental risks of Myitsone, meanwhile, are enormous by threatening the flow of the Irrawaddy River, Myanmar's main and most culturally significant waterway. The proposed 152-meter high dam, which if built will create a reservoir the size of Singapore, would be situated between the Yunnan and Sagaing Faults.
A recent geological study jointly conducted by Myanmar's Ministry of Transport and Japan's International Institute of Seismology and Earthquake Engineering indicates that a major shift in the Sagaing fault, situated only 100 kilometers west of the dam site, could soon occur and might affect the new capital Naypyidaw. Their analysis and maps showing the fault extending south into the Andaman Sea and north into Kachin State is thought to have influenced Thein Sein's decision on the dam.
Independent geologist and blogger Ole Nielsen noted in a blog entry that previous dams built in Myanmar have collapsed and suggested that the Kachin state capital Myitkyina would be wiped out in the event of a Myitsone dam collapse. He added that the Ching Hkrang dam 16 kilometers north of Myitkyina and the agricultural Washawng dam in Wiangmaw district collapsed in 2006 after incessant rains.
Experts say a dam as large as Myitsone, in combination with its seismic location, could also trigger earthquakes though so-called reservoir induced seismicity, a geological phenomenon where water in large reservoirs shifts land masses and through infiltration weakens underlying fault lines. There have been over 90 identified incidences of earthquakes triggered by water reservoirs worldwide, including in China's Sichuan province in 2008.
Meanwhile, a United States Geological Survey team indicated in a recent report that the Himalayan glaciers, some of which feed the Irrawaddy River, are retreating at an alarming rate. (If so, in a few years the Myitsone dam could become a giant sandpit.) The survey warned that the glacial retreat brings a greater risk of so-called Glacial Lake Outburst Floods, which occur when melt water inside a glacier breaks out with extreme force and sends a tsunami of silt carrying water down stream slamming into dam walls. This has already had devastating effects in nearby Nepal.
The controversy over Myitsone runs deeper, however. Myanmar's military junta first proposed the dam's construction in 2006 and three years later contracted the local Asia World Company and China Power Investment Corp (CPI) to build it. Asia World was established by Lo Hsing Han, a Kokang Chinese from the opium-producing region of Myanmar 's Golden Triangle who has been identified by the United States Drug Enforcement Agency for involvement in narcotics trafficking and money laundering.
Asia World is now controlled by his son Stephen Law (Tun Myint Naing) and close to Myanmar Vice President Aung Myint Oo who in turn is a close ally of former junta leader Senior General Than Shwe.
The now stalled joint venture agreement between the CPI and Asia World involves many powerful interests. The deal enabled CPI to build and operate Myitsone in partnership with Myanmar Electric Power Enterprises and a consortium of Chinese companies, including the China Gezhouba Group Corporation, whose contract is worth $153 million, China Power Investment Corporation Materials and Equipment Company, whose concrete work had been priced at $75 million and the politically connected Sinohydro Corp, which was responsible for road building and civil engineering.
Despite those big commercial interests, Thein Sein said he was responding to the "will of the people" in suspending the dam. The decision has raised bilateral tensions, with China's Ministry of Foreign Affairs spokesman Hong Lei saying in October soon after the announcement that Myanmar must "protect the legal and legitimate rights of Chinese companies". It's unclear if Myanmar has paid any compensation since the mega-project was stalled.
CPI president and Communist Party secretary Lu Qizhou said in interviews soon after the September 30 suspension was announced that he was "shocked" by the decision and insisted that his company had followed all legal procedures in winning the contract.
The various interested parties in the dam maintain that hundreds of scientists had agreed that the environmental impacts would be minimal despite the size of the reservoir and the biodiversity significance of the dam site. (Some Yangon-based cynics say that this is because Chinese poachers have already cut or mined everything of value around the dam site.)
Myanmar has yet to formulate comprehensive laws supporting regulations or even research teams capable of completing the rigorous testing and reporting necessary to properly assess such a massive project. However, it is clear from Thein Sein's "will of the people" statement that his government takes environmental concerns more seriously than the previous ruling military junta.
While the dam has been deferred until 2015, coinciding with the end of Thein Sein's term, wrangling over the multi-billion dollar mega-project is expected to animate China-Myanmar relations in the years ahead. Taking into account the cultural significance of the Irrawaddy River and the ongoing conflict in Kachin state, it is possible that Thein Sein's suspension will eventually lead to an outright cancellation. (Already some of the resettled families have returned to their home villages, according to on-the-ground sources.)
In a survey published in Myanmar Affairs, a website maintained by Myanmar academics, 58% of respondents surveyed approved of Thein Sein's environmental initiatives. The survey found that 90% of the 1,000 people interviewed opposed the Myitsone dam for environmental, socioeconomic and cultural reasons. While China continues to propagandize that the Myitsone dam is Myanmar's national interest, Myanmar's people and leadership view it differently....