Geography Reference
In-Depth Information
is not unlike investing in commodities on the futures market: it represents the potential to
reap substantial financial benefits down the road—provided such benefits actually materi-
alize, given the uncertainty of future energy prices—with minimal upfront costs. Between
these two extremes exists an array of other kinds of arrangements in which Chinese firms
participate in a piecemeal fashion, providing expert advice, equipment, financing options,
and other services (International Rivers 2012).
Chinese government agencies and corporations are involved in a huge number of hy-
dropower projects in the Southeast Asian region but also increasingly in Africa and Latin
America. On the regional front, Chinese firms have found it particularly fruitful to work
in Myanmar, where a military junta has controlled the country for four decades, leaving
Burmese citizens with few mechanisms to participate in the decision-making process or to
called, a series of five dams is already under way in Myanmar with investment from Thai,
Burmese, and Chinese companies, including Sinohydro Corporation, China's largest state-
owned enterprise in the energy and construction sectors, which has built a veritable spider
web of subsidiary companies (International Rivers Network 2009).
Similarly, the China Power Investment Corporation (CPIC), a state-owned enterprise
under the direction of the State Council, which also holds a controlling interest in many
publicly traded subsidiary companies, is working to develop a series of seven dams
on the Irrawaddy River in Myanmar—the next major watershed to the west of the Nu
basin—including the U.S.$3.6 billion Myitsone Dam. CPIC has proposed to use a build-
operate-transfer model under which it provides initial financing and construction, in co-
operation with several Yunnan-based companies and foreign-owned companies. Under the
most current arrangement, CPIC would operate the dam for a period of fifty years—while
selling most of the power to China but also providing some free electricity and revenue to
the Burmese—and then transfer ownership rights of the facility to the Myanmar govern-
ment (Meng 2012).
But recent developments in the Myitsone Dam project have highlighted the financial and
political risks at stake under such arrangements. Media reports exposed the forced removal
of thousands of people from the dam area, mostly villagers from the Keqin minority, at the
handsoftheBurmesemilitary.ThepresidentofMyanmarannouncedin2011thattheMyit-
sone Dam would be suspended during the tenure of his administration, citing environment-
al impacts and concerns for the social protection of minorities; this announcement placed
China in the uncomfortable position of being outflanked by Myanmar on issues of trans-
byseveral scholarsattheChinese Academy ofSocial Sciences thataccused WesternNGOs
of stirring up trouble in the Mekong region, arguing that such groups have “severely dam-
aged China's reputation” by exaggerating claims about the environmental damage caused
by Chinese firms (J. Li 2013).
