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Troubled Waters
As protests continue over dam-building, a landmark review calls for a reth ink on future projects

China's Folly

Timebomb at Three Gorges

After a wave of anti-globalization protests, World Bank president James Wolfensohn might have expected a demonstration or two during his tour of bank projects in India last month. He wasn't disappointed. In Delhi, he came up against several thousand protesters camped outside the institution's sleek offices, waving placards and clenched fists, demanding a meeting with him. The lives of these poor farmers, fishermen and tribal people are being thrown into turmoil by the mega-dam project on the Narmada River for which the bank had provided initial loans.

Normally their views would never be heard. This time they were. They asked Wolfensohn to press the Narmada managers for an accounting of the funds — and to give an assurance that the bank would not reverse its 1993 decision to withdraw from the project. "We made him listen to us," says protest leader Medha Patkar.

Just a few years ago, chances of such a meeting taking place would have been slim. But international institutions such as the World Bank must now give greater consideration to the voices of the disadvantaged — and pay closer attention to the terrible human and environmental costs often exacted in the name of progress. Few of the conflicts over development have roused such bitter, persistent divisions as large dams.

Thus it made sense that the bank, for decades the biggest single financier of these projects in the developing world, should be the driving force behind a comprehensive review. Its vehicle: the World Commission on Dams, an organization formed in 1998 specifically to bring together industry representatives, governments and green activists. After two years, four regional consultations, eight case studies and about 950 submissions from interest groups, the commission unveiled its results in November in a report entitled Dams and Development. The conclusions are damning.

For most of the past century, dams have symbolized development, engineering ingenuity and national pride. And dams can make huge contributions to economic growth. They help control floods, supply vital water to farmers and expanding cities, as well as power to homes and businesses. But, according to the report, many ambitious projects were ill thought-out and badly executed. It concludes that all too frequently, "an unacceptable and often unnecessary price has been paid to secure those benefits." Up to 80 million people worldwide have been forced out of their homes and settled elsewhere with paltry compensation and no viable means of earning a living.

The list of indictments is daunting: Costs have exceeded estimates by an average of 50%; ecosystems were destroyed or permanently damaged; hydroelectric dams, once held as clean, renewable energy sources, turned out to be significant generators of greenhouse gases given off by decomposing vegetation in tropical reservoirs. More often than not, projects simply failed to deliver the benefits that proponents promised. For instance, some dams designed to reduce flooding actually worsened it. In hot, dry areas, salt build-up in reservoirs has led to saline waters that ruined farmland.

Even before the report, these icons of modernity had been losing their allure. In the U.S., more dams are being decommissioned than are being built. Among the latest targets: four dams across the Snake River in Washington state which are said to threaten the survival of salmon. In Japan, residents in the town of Tokushima voted by a 10 to one margin to reject the construction of a billion-dollar dam across a nearby river. They judged it a waste of taxpayers' money. Taiwan's green lobby has even managed to stop a project near southern Meinung town that would have flooded a valley known for its butterflies. Meanwhile, the Bakun dam in Malaysia and the San Roque project in the Philippines continue to draw fire from citizens' groups.

Of the major projects already completed, Pak Mun dam in Thailand, which the commission studied in detail, highlights shortcomings described in the report. The $264 million project went ahead with little consultation with local residents, and was completed in three years (with $24 million in bank aid). But the dam generates just 20.81 megawatts of electricity — a sixth of the 136MW capacity touted. Environmental assessments were laughable. Consultants had predicted fish yields in the reservoir of 100 kg per hectare each year, but villagers netted just one tenth of that. Downstream, catches declined markedly, too, and fish species dwindled on both sides of the barrage. Assurances that impact on local inhabitants would be minimal were no more credible. Some 1,700 households were moved instead of the 240 predicted. Then, about 6,200 families had to be compensated when fisheries were affected during construction, and there is no reparation for permanently damaged fisheries. Little wonder the report concludes: "If all the benefits and costs were adequately assessed, it is unlikely that the project would have been built in the current context."

Conflict at Pak Mun has not eased over the years. If anything, relations have deteriorated between villagers and EGAT, the state utility that built and operates the multi-purpose facility in Ubon Ratchathani province. Now peasants are demanding that the dam gates be opened to allow migrating fish to spawn and repopulate the river. Just two days after the dam commission's revelations, thugs linked to the utility attacked village protesters camped at the dam crest and burnt down their shelters. "Previously, we were often threatened, but it was not too violent. [The recent incident] was the worst," says activist Somparn Khuendee. After initial denials, EGAT eventually owned up: The attackers were in their employ. The men had been instructed to "politely" ask the protesters to leave, but the confrontation turned violent, Boonlert Mongkolwit, assistant PR chief of the utility, said. But he is unapologetic. "[The protestors'] presence has obstructed our work and their shacks on our property are an eyesore."

Track records in China and India, the two nations reviewed in the report, are little better. The Asian giants account for 26,291 dams, 55% of the world's total. China has built 22,000 since 1949 — almost one for every day since Liberation. But this "rush to construct so many — and such large — dams in so short a time has also led to serious safety concerns and a costly program to address these issues," the report notes. Some 12 million people have been displaced in that period. Yet China's irrigation and water-supply problems persist.

The report does not specifically examine two of the most notorious dam projects in the world: China's Three Gorges Dam, which the bank declined to fund; and the Sardar Sarovar scheme, which involves 30 large dams, 135 medium ones and 3,000 small ones along the Narmada river in India. No project comes close to the Three Gorges Dam in ambition — and controversy (see story below). Despite deepening criticism internally and abroad, Chinese leaders pushed ahead with the project. Consultation is not part of the Communist Party of China's vocabulary. But, as the report notes, decisions are similarly arbitrary in India. Planners are often ignorant of non-dam alternatives. People facing resettlement have no recourse to resolve their grievances.

The commission's report comes as a timely boost for Indian dam opponents. Villagers waging a 12-year struggle to block the Narmada project suffered a serious setback in October when the Indian Supreme Court ruled that construction could go ahead. With its emphasis on civic participation and holistic evaluation, activists cite the report as vindication of their cause. All the same, many people in Gujarat state, which suffered its worst drought of the century this year, welcome the court ruling. For them the dam carries the vision, held out by government leaders, of transforming the parched land into lush wheat fields.

That goal may turn out to be a mirage. Protestors insist the project will not meet the water needs of Gujarat, which is on the periphery of irrigation grids. Rather, the scheme favors big farmers and water-guzzling industries downstream. "The ruling elite has planned water resorts and other such entertainment parks. How will the poor benefit from all this?" asks activist Sripad Dharmakhidary. The Narmada movement is standing its ground, not least because indifferent state governments have declared that there is no land for resettlement of the estimated 41,000 families who face eviction.

But the purpose of the World Commission on Dams was to provide a framework for evaluating future dam proposals. Its conclusion was that if a dam is to be genuinely successful there must be openness and transparency in decision-making throughout the process. Everyone affected should have the chance to voice his or her views, at each step of the process. And perhaps most importantly, social and ecological impact should be given as much weight as economic considerations.

Unfortunately, those are worthy but very broadbrush ideals. As a hybrid organization, the World Commission on Dams has been careful to tread the middle ground. "The commission spent time researching just how to view indigenous peoples' human rights," says secretary general Achim Steiner of Germany. "We believe that we provide a basis for negotiation and protection of interests for people who find themselves in a disadvantaged position."

Pie in the sky? Perhaps. Some politicians welcome the recommendations as support from for "bottom-up decision making." But can dam advocates and opponents ever come to a compromise? How far will governments and development agencies adopt the recommendations? Or will banks and dam builders end up just paying lip service to social and ecological considerations?

Signs are the logjam won't be loosened anytime soon. The International Commission on Large Dams (ICOLD), a leading industry group composed of professionals and engineering companies, expressed reservations about the report even before it was out. ICOLD complained that it was not given a chance to vet the document before it was approved. Thai utility EGAT rejects the findings on Pak Mun as "distorted." Villagers seeking compensation for lost fisheries are plain lazy, says its assistant PR chief Boonlert. "Wherever you have the water source, you have fish, but the villagers didn't want to work. They just hope to get more money from us." So much for community spirit and compromise.

Still, some dam builders, like the Swedish construction group Skanska, have embraced the guidelines. The commission's work is "a major stride for sustainable development . . . we are prepared to actively strive toward these [new criteria] being accepted," declares Skanska's vice-president of environmental affairs, Axel Wenblad. "There's more than one voice within ICOLD," notes James Workman, a senior World Commission on Dams media adviser.

But some citizens' groups are equally skeptical about the commission's work. After all, it has no power to enforce changes or to adjudicate disputes. "When you talk about dams, both sides at the table will agree on the policy," says Wanida Tantivittayapitak. of the Thai activist group Assembly of the Poor. "But nothing is discussed about what has to be done to resolve the problem."

Still, Wolfensohn believes no country can ignore the impact that the report brings to a global rethink on dams. "There are a lot of places where you can apply pressure," he said after its launch. Projects need financiers and construction companies. "You cannot just have a single decision-maker in a country saying 'To hell with it, I am going to ignore these recommendations.'" Try telling that to Chinese President Jiang Zemin. Wolfensohn and the World Bank must pay more attention to the demands of local interest groups. But until leaders in developing nations become more accountable to their citizens, massive, over-priced dams will continue to be the dream of national politicians and the nightmare of local inhabitants.

With reports by Sanjay Kapoor/Delhi and Jennifer Gampell/Bangkok

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