TOPICS : Audit of world’s biggest dam sought

The Three Gorges dam in China is attracting renewed calls for an independent financial and environmental audit, as concerns mount over the hefty costs of the world’s largest dam and its social and environmental impacts.

The Toronto-based environmental group Probe International (PI), which put up stiff opposition to Canadian financial backing for the multi-billion-dollar project, said that claims by the dam authorities that the Three Gorges project will cost some $25 billion have never been independently verified.

Local authorities announced earlier this month that the dam, whose construction began 13 years ago, will be completed this month, nine months ahead of schedule. The entire project, sometimes compared to the Great Wall of China in its mammoth scope, could be completed in 2008, more than a year ahead of schedule.“To sort economic fact from fiction, China needs a comprehensive independent audit of the real costs of the Three Gorges project,” said Patricia Adams of PI.

The dam has been one of the most controversial infrastructure projects in recent years. It has drawn fire from environmentalists and rights campaigners who say it is one of the highest-impact hydropower projects on the environment and local populations.

PI says that the true cost of energy produced by the giant Three Gorges project will be at least several times the government-fixed price of three cents per kilowatt-hour. It urged an investigation into contentious issues like pollution in the dam’s 660-kilometre reservoir, salt-water intrusion and land erosion problems in the Yangtze estuary near Shanghai. It also pointed a finger at corruption and abuses in the resettlement of some 1.3 million people.

Some Chinese online news outlets have defended the project, saying that after completion, it will help control flooding of the Yangtze River, protecting some 15 million people and 1.54 million hectares of farmland. The press is also saying that when operational, the dam will address electricity shortages as well as help spread the country’s economic boom to poor areas.

But environmental campaigners, who have long said large dams come with huge costs to the ecosystem and to locals, are not convinced. They argue that dams lead to involuntary resettlement, human rights abuses, destruction of critical habitats of endangered species, and significantly contribute to climate change from methane emissions.

Despite the uproar, industrialised nations have been unabashed in using export credit agencies, which provide loans and guarantees to private corporations from their home country to do business abroad, to fund mega-dams, including the Three Gorges. Canada, France, Germany, Japan, Sweden, Switzerland have all provided at least $1.5 billion in export credit to finance the sale of turbines and other equipment for the project. About 40 per cent of the project’s funding came from the government of China and the rest came from loans and external financing. — IPS