Three Gorges dam 'will better Nature'

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Sometimes nature loses her balance and it takes a massive Chinese hydro- engineering project to sort her out.

"The gradual evolution of the Yangtze river has already caused the inbalance, or has already made the river lose its original balance," said Lu Youmei yesterday, general manager of the Three Gorges Dam Development Corporation.

"So we think that the balance is a relative concept, whereas imbalance is an absolute concept. So, given this situation, we must adopt some artificial or man-made engineering methods to change the already imbalanced ecosystem."

In this case, the artifice is the Three Gorges Dam, one of the world's most controversial infrastructure projects which on completion in 2009 will have displaced more than one million people, cost around 204bn yuan (pounds 16bn), and will flood a total area the size of Singapore.

Around the world, questions persist about the social and environmental cost of the project, and whether siltation will under- mine the best calculations of the engineers. Within China, all debate on the project has been silenced despite the fact that five years ago nearly one-third of the normally compliant deputies to the National People's Congress (NPC) did not vote in favour of the scheme. In November this year, the first phase of the dam will be completed when the course of the Yangtze is diverted behind temporary dams and work on the 175-metre high main dam wall commences.

Yesterday, the men who are in charge of building the dam confronted sceptics with a display of confidence verging on hubris. "We can foresee all the possible difficulties that we are going to face in the course of construction, and we have adopted corresponding measures in this regard," said Mr Lu. He admitted that risks could also involve social and financial considerations, "but under the current circumstances of China's development we do not foresee any such kind of risks".

The project is the largest earth-moving exercise in history. Upstream, the new reservoir will drown the famous Three Gorges Scenery, force the relocation of 1.2 million people, 1,600 enterprises, several cities, 140 towns, and 4,500 villages in Hubei and Sichuan provinces.

Relocation is the most sensitive issue, but one on which officials will engage in little public debate. Just 60,000 people have so far been moved, and in January this year a special body was set up to prevent misuse of the relocation funds; financing luxury hotels and cars with the money was outlawed.

Funding the massive project has posed another uncertainty. The dam has no World Bank support, thus avoiding stringent independent environmental assessments. So electricity price levies, income from electricity generation, bank loans, export credits and public bond issues must raise the necessary funds. Mr Lu said: "We expect to repay all the debt by 2012."

Siltation is the biggest technical challenge. Every year the Yangtze carries down some 530 million tonnes of silt in its waters, much of which will be trapped behind the dam wall. Guo Shuyan, deputy director of the dam construction committee, said that after 50 to 80 years, this build- up will "only" decrease storage capacity of the dam reservoir by 14 per cent.

For the people of China, the best thing that can be said about the dam project is probably the short-term investment spin-offs. The government is offering very attractive terms to raise the cash. A 1bn yuan tranche of public bonds, paying interest at almost twice inflation, and re- deemable after just three years, went on sale on 28 February - and sold out in five days flat.