Chinese Investments In Myanmar: A Dam Too Far – Analysis


By Obja Borah Hazarika*

In 2011, the Thein Sein-led government of Myanmar citing public protests suspended construction work of the USD 3.6 billion hydropower project called the Myitsone Dam, much to China’s chagrin. Five years later, China has begun to seek an end of the suspension of its work or compensation from the government in Myanmar for the losses it incurred due to the suspension of the dam. Recently, Chinese Ambassador Hong Liang, with a delegation from China’s State Power Investment Cooperation (SPIC), visited Kachin State to lobby for the resumption of work on the stalled Myitsone Dam.

The delegation aired three options for Myanmar with regard to the Myitsone: 1) Cancel the project and be liable to pay USD 800 million in compensation; 2) Resume work and earn $500 million a year in revenue when the dam is completed or; 3) Do nothing and pay $50 million in interest for as long as the project is suspended. Mr Liang also toured the region where the Myitsone is supposed to stand and spoke with residents who were displaced as a result of the initial construction of the dam.

Despite overwhelming investments in Myanmar, Chinese companies like the SPIC and others like China Three Gorges Corporation, involved in the Mong Ton Dam in Shan state on the Thanlwin (Salween) River, have been facing virulent opposition from various sectors in Myanmar. These protests are mostly led by environmentalists and the Myitsone is especially problematic as it is planned in a region considered sacred by the Kachin’s of Myanmar. China’s proposed copper mine in Sagaing region is also under the scanner as are several of China’s other investment ventures in the country.

The Myitsone is located in the region considered sacred by Kachin who are already at severe loggerheads with the government which has manifested in the form of one of the most arduous insurgency movements in the country. The decision to suspend construction of the Myitsome taken by Thein Sein was met with much appreciation by the population of the country which had seen the project as destructive both economically and ecologically as 90% of the power generated was to be sent to China’s Yunnan province, while the displacement and devastation which Myanmar would suffer from was deemed phenomenal. However, Thein Sein’s regime had only suspended the construction, thereby postponing the inevitable until a later day. Now will the NLD government having settled in, the Chinese companies involved in the Dam have been demanding the matter be properly settled.

While China has a huge demand for hydropower, especially in its landlocked Yunnan region, Myanmar’s demands for irrigation facilities are also tremendous in the lean season making the construction of dams necessary. However, due to the enormous social and environmental costs incurred with the construction of massive dams, the civil society in Myanmar and ethnic groups in whose home base such giant dams are being planned have been protesting such constructions.

Proper handling of the construction of such dams, especially factoring in the components of adequate compensation and involvement of local populace in deciding the size of the dam, its height and electricity generation amount, would be beneficial for both China and Myanmar. It would help China gain hydropower and help it amass an image of being open to local demands; and would enable the National League for Democracy (NLD) gain popular support as well as answer Myanmar’s larger question of the paucity of irrigation facilities and provide it with electricity required for its overall development.

The NLD government, including Suu Kyi has been thus far respectful of the wishes of the locals and have not wholeheartedly supported the renewal of the construction of the dam. In order for the locals to identify with the Myitsone as a project aimed to being development which would be beneficial for the masses and not just for those in the State or the upper echelons of corporations involved in construction, those displaced and most adversely affected in terms of loss of livelihood, heightened insecurity and facing the scourge of penury due to projects such as Myitsone, should be the first beneficiaries of such projects. Huge dams all over the world have been proved to be ecologically and economically unviable as well as highly adversarial to the locals who are forced to relocate and forced to undergo untold hardships.

A series of smaller dams instead of the gargantuan Myitsone may perhaps be more feasible and more conducive to local conditions in Myanmar. The mediation attempts currently being undertaken by China to either extract compensation from Myanmar or renew work on the project should focus instead on making the dam more practicable, especially as the Kachin area is among the most volatile regions in Myanmar.

Given the fact that even during the Thein Sein regime protests had erupted over the Myitsone, if work is renewed on the dam under terms not favourable to the locals, it is certain that under the presently more liberal political climate protests on a huge scale would rock the country that would be a disaster for Myanmar’s fledgling democracy – especially since communal clashes continue unabated, the peace process remains precarious and the overall economic situation is far from encouraging.

*Obja Borah Hazarika is an Assistant Professor of Political Science, Dibrugarh University, Assam. She can be reached at: [email protected]

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