RTf 09/19 2339 China listed firms compete in Yangtze dam project [HOME] [ThreeG] [Power][ThreeG94]
SHANGHAI, Sept 20 (Reuter) - More than 50 of China's listed companies are
now competing to take part in the construction of the gaint Three Gorges
Dam project along the Yangtze river, the China Securities newspaper reported.
Some firms have already won tenders in the project. Construction is expected
to last for 15 years and involve investment of up to 150 billion yuan,
the paper said. Shanghai-listed Huaxin Cement has signed a contract to
supply 31,000 tonnes of cement, the paper said. MORE<600801.SS>
UPI NewsFeature (950) (release at will)
By RUTH YOUNGBLOOD YICHANG, China (UPI) -- Chen Xiaolin, chief engineer
for the Three Gorges Dam hydroelectric project on the Yangtze River in
central China, shouts her orders over the roar of earthmovers and excavators.
The 57-year-old grandmother commands an army of 30,000 workers converting
one of the world's most breathtaking environmental treasures into its biggest
hydroelectric plant.
"The scope of what we are doing is so enormous it sometimes leaves
me breathless," said Chen, who has four large dams to her credit and
was chosen to spearhead this endeavor 75 years after the project was first
suggested by Sun Yat-sen, founder of modern China. Yet if Chen is breathless,
critics of the project are exasperated. The $34 billion price tag, some
economists say, could overburden China's delicate financial apparatus as
the economy marches toward modernization. Worse, say environmentalists,
an altered flood plain will submerge the homes of 1.2 million people and
threaten various wildlife, including the Yangtze dolphin.
Workers are gouging out hills and ravines and destroying an arresting vista
of jagged cliffs and green-topped mountains that have inspired poets and
painters for centuries. The once lush landscape is now blighted by litter,
mud and temporary housing. Undeterred, Chen and others insist the 17-year
undertaking that began last year will provide all the electricity for power-hungry
central and southern China and will protect densely populated areas downstream
against recurring and often devastating flooding. But perhaps most important,
it will reduce coal-generated pollution and light up Chinese homes, only
two-thirds of which are connected to an electricity supply. After much
debate and delay, the National People's Congress in 1992 authorized the
project, decades after late Communist Party Chairman Mao Tse-tung advocated
it in the 1950s.
Supporters say the project represents a long-term bonanza for China, transforming
a backward river valley into an economic powerhouse. The size and ambitiousness
of the Three Gorges project inspire comparisons with the Great Wall, but
supporters insist it will be far more than a tourist attraction. If all
goes according to plan, the 1-mile long, 607-foot-high (1.6- km, 185-m)
structure is scheduled to be completed around 2010, with 26 hydropower
generators producing 84 billion kilowatt-hours of electricity annually,
an alternative to the yearly consumption of up to 50 million tons of coal.
China currently produces about 700 billion kilowatt-hours of electricity
annually.
The Three Gorges project also will include the largest ship-lift in the
world and five shiplocks. Stretching some 370 miles (600 km), the reservoir
will inundate 19 counties and cities, 140 towns and 4,500 villages, requiring
the resettlement of 1.2 million people. More than 10,000 already have been
moved into "resettlement test zones." "Resettlement and
the cost are very big problems," acknowledged He Gong, vice president
of the China Yangtze Three Gorges Project Development Corp., from his office
in the Hubei Province city of Yichang.
In 1990, the overall cost was estimated at $7 billion, a figure that has
multiplied five times in four years and could double again before the project
is completed. Keen to whip up overseas enthusiasm and investment, State
Councilor Li Tieying proclaimed the Three Gorges region "a huge potential
market and a good area for foreign enterprises," particularly the
cities of Yichang, Wanxian and Fuling. Economic progress, however, is little
consolation to many who must abandon their homes and farms. Yang Faseng,
director of the People's Resettlement Bureau, said the relocation project
is unparalleled in China, where authorities are developing retraining programs
for the special resettlement zones. "Once those to be resettled understand
they will actually be better off," Yang said, "there is less
reluctance to moving." "Farmers can be taught elementary skills
enabling them to work in factories," he said. "Others will still
have access to farms."
To further ease the transition and quiet rumors of unrest, officials have
authorized buyouts as well. Displaced families in Yichang are eligible
for 6,000 yuan ($697) in compensation, plus as much as 56 yuan ($6.51)
a month for three years -- a package far above the average rural income
of 921 yuan ($106). In one of the first zones to be started near the dam
site, many residents agreed the attractive, two-story houses with sparkling
white tile fronts represented a major improvement over their previous dirt-
floor dwellings. "There's no question this home is far better than
anything I ever lived in before," said 41-year-old Xiang Changchun,
escorting visitors through her four-room house. "But now I'm a farmer
with nowhere to farm," Xiang said. Authorities have promised to build
factories, schools, hospitals, shops, restaurants and theaters, but none
have started and residents are increasingly frustrated and skeptical of
official pronouncements.
Yet some, like 45-year-old Chen Honghai, have sniffed out opportunity amid
adversity. The envy of his neighbors, Chen has secured a job helping cooks
prepare meals for dam workers. "No one is happy to learn he must move,"
Chen said, "particularly when it means giving up the only way of life
one has ever known. We were told we had to move regardless of the inconvenience,
that the country needed the land and that was that." But 73-year-old
Tan Dexun has no complaints. After 50 years tending crops of grain, wheat
and potatoes, Tan is finally enjoying his retirement in a huge home accommodating
an entire family of 16 people. "I've never had it so good," Tan
said. "The dam is good for the country and this new home is good for
us."
BEIJING, Nov 26 (Reuter) - China said on Saturday it would have spent US$176
million by year's end to resettle thousands living in the dam construction
zone of the Three Gorges hydropower project, the biggest of its kind in
the world. Project resettlement director Tang Zhangjin said he had finished
resettling an unspecified number of residents whose homes were in the way
of the giant dam in Hubei province. "If the residents are not resettled
in time, the project cannot be finished as planned," Tang was quoted
by China's official Xinhua news agency as saying. He said that over the
next 17 years his office would resettle 1.13 million people from 30,000
hectares (74,000 acres) of farmland, orchards and forest in Sichuan and
Hubei provinces slated for inundation by the Three Gorges reservoir.
The controversial Three Gorges dam, given legislative approval in 1992
after five decades of false starts, will be the world's biggest hydropower
project. Work on the dam is to start in coming weeks but it will be years
before the new reservoir begins flooding land. Tang said no single public
works project anywhere in the world had displaced as many people and Beijing
was taking a far more active role in the lives of the displaced than it
had for 80,000 previous reservoir projects.
In the past China had simply sent citizens packing with "very limited"
cash compensation, he said. This time huge amounts are being spent to replace
what is destroyed. He said 1.5 billion yuan ($176 million) would have been
spent last year and this on resettlement projects, including farming development,
water conservation, infrastructure for cities or towns that are moved,
resettlement of enterprises and rebuilding of special facilities.
The dam project is uprooting people from two cities, 11 towns and 1,600
enterprises. They are being channelled into six regions designated as resettlement
centres. "The central government allocated a certain amount of money
for housing construction, land development, and infrastructure in advance
to ensure the residents' standard of living would be better than it used
to be," Tang said. "Compared with the land they previously owned,
the farmland newly developed for the resettled people will be more and
better," he added.
REUTER
Copyright, 1994. The Associated Press. All rights reserved. BEIJING (AP)
-- China anticipates it will need $3 billion in foreign funding over the
next 10 years for its huge Three Gorges dam project on the Yangtze River.
The money is needed to purchase equipment for the construction project,
which is expected to continue well into the next century.
When completed, it will be the world's largest hydroelectric dam. The government
is considering issuing overseas bonds and seeking commercial foreign loans
and export credits, but is concerned about being burdened with debts, the
Xinhua News Agency reported today.
It has consulted international financial institutions, including the Morgan
Group of the United States and Japan's Nomura Securities Co., the report
said. Several U.S. companies, including Caterpillar, Inc. of Peoria, Ill.
and U.S. Asian Pacific Enterprises of San Diego, have won contracts to
supply equipment and develop the area around the dam. The project has been
harshly criticized by environmentalists for flooding land along the Yangtze.
By Jane Macartney BEIJING, Dec 13 (Reuter) - Chinese Premier Li Peng, an
electrical engineer, breaks ground this week for the huge Three Gorges
dam on the Yangtze, a project that will cost nearly two percent of GNP
and was battled over for 75 years.
With costs estimated at $12 billion by completion in 2009, some local residents
opposing it and foreign investors still to be convinced, Li has a tough
task on his hands to see through his pet project and China's biggest engineering
project since the Great Wall, analysts said. The premier, a Soviet-trained
engineer who once headed the Ministry of Power Industry, will break the
ground to mark the official start of construction of the 175-metre (574-foot)
dam across the Yangtze on Wednesday.
"After 70 years of debate and the effort of several generations, this
is a day we have awaited for a long time," Liu Hungtai, director of
project organisation in Yichang on the Yangtze in central Hubei province,
said by telephone.
Total investment will amount to 1.75 percent of gross national product
(GNP) and 4.29 percent of total investment in state infrastructure during
the 17 years of construction, the Xinhua news agency said. Much of that
cost will be construction of the dam and resettlement of millions of local
residents, Luo Changmao, director of the Planning and Funding section of
the Three Gorges Construction Committee of the State Council (cabinet),
told Xinhua. He estimated total cost at 90 billion yuan ($10.5 billion)
-- not including interest payments and price increases -- and said final
cost will exceed 100 billion yuan ($12 billion).
Western diplomats have said China may have difficulty raising those funds,
with costs likely to overrun estimates. Most of the seven billion yuan
($823 million) needed for initial preparation work in 1993 and 1994 has
already been raised, Luo said. The money came from national increases in
the price of electricity as well as profits from the nearby Gezhouba hydropower
station and loans from the State Development Bank. "Every Chinese
citizen will be contributing to the cost because the price of electricity
has been raised," Liu said.
China will have spent $176 million by the end of this year just on resettlement
of thousands of people living in the dam construction zone. More than 1.3
million must be moved but some have been unwilling to go.
The Three Gorges dam, first suggested in 1919 and given legislative approval
in 1992 after five decades of false starts, will be the world's largest
hydropower project. Li has battled for the dam, overruling environmental
concerns and charges of economic waste, arguing the need to tame the river
and its floods when he pushed it through an unusually fractious parliament.
Officials have said China will need to borrow more than $3 billion in the
next decade to buy equipment and is considering raising funds abroad through
issuing overseas bonds, commercial foreign loans, and export credits. More
than 10,000 workers are already working round the clock at the construction
site.
The dam will cut the Yangtze in 1997 and is scheduled to begin generating
electricity in 2003. When all 26 power generating units go into full operation
in 2009 it will have total capacity of 18.2 million kilowatts, Liu said.
The newly built 2,500-metre (1.5 mile) long and 80-metre (262 foot) high
cofferdam on the southern river bank has withstood floods this year and
a diversion canal is being dug to pave the way for damming the river in
1997. "This dam will strengthen our ability to fight floods, guarantee
power to ease shortages and boost river transport," Liu said.
BEIJING, Dec. 14 (UPI) -- Chinese Premier Li Peng opened work on the controversial
Three Gorges Dam project Wednesday by urging local leaders to successfully
resettle the 1.13 million people whose homes will be submerged by the new
reservoir on the middle reaches of the Yangtze river. "More than 1
million people will have to be relocated from the area, " said Li
as he watched final preparatory work for China's most ambitious construction
project since the Great Wall. "This will be the key issue in deciding
whether the project will be successful or not."
Final approval for the massive dam -- which is the world's largest hydroelectric
power project and will provide electricity for central and eastern China
-- was given in 1992, 40 years after the late Communist Party Chairman
Mao Tsetung set the plan in motion.
But critics have denounced the 100 billion yuan ($11.8 billion) scheme
as an environmental and financial disaster that will destroy ecosystems
in the Yangtze basin, inundate 60,000 acres of fertile orchards and farmland
and affect the livelihoods of some 75 million Chinese who live downstream
of the dam. China's central government, however, believes the benefits
of the 185 meter (610 foot) barrage far outweigh its negative aspects.
"The project will have long-term benefits in flood control, electricity
generating and shipping, not only in the Yangtze river area but also throughout
the nation,"
Li said. China plans to boost state financing of the massive project, which
it plans to complete in 2009, with foreign investment, stocks and bonds.
"Investment for the project is fully guaranteed...and certain measures
to raise money both at home and abroad have been taken," Li told the
hundreds of officials who gathered at the Sandouping dam site in central
Hubei province.
But foreign investors continue to be wary of the project, both because
of its enormous size and its possible effects on the environment. Although
western construction companies have started to supply equipment for subsidiary
projects, there has been a marked resistance to getting involved in the
dam itself and the U.S. investment bank Morgan Stanley stands alone in
its pu. "Manufacturers and businessmen of large hydropower and transformation
equipment from around the world are welcome to participate in the construction."
世界最大の水力発電所となる中国・長江（揚子江）中流の三峡ダムの着工式が十四日、湖北省宜昌市三斗坪で行われた。二００三年から発電を一部始め、十五年後の二００九年に全面完成する予定だ。上海や広東省まで送電ネットで結ばれ、中国の経済発展を支える。 今世紀の初期からの構想で、着工式には李鵬首相をはじめ、約一万人が出席した。
計画では、えん堤の高さが百八十五メートル、貯水位は百七十五メートルとなる。発電能力は千七百六十八万キロワットで、目下、世界最大のイタイプ水力発電所（ブラジルとパラグアイ国境のパラナ川）の一・四倍。洪水の防止や、上流の水位が上がることで大型船の航行が可能になることへの期待も大きい。 一方で、四国の約一・五倍にあたる二万八千平方キロの土地が湖に沈み、百十三万人が移住しなければならない。三国志関係のものなど沈む文化財も多い。 本体建設費に、送電施設建設費と移転保障費を加えた総額は、昨年の計算で九百四十億元。物価の急激な上昇で、現時点なら千億元（約一兆二千億円）を超えるという。
費用が巨額なことや生態系への影響などから、建設に反対の声もあったが、一昨年に建設が決定し、工事用道路の整備など準備工事が行われていた。
By Jane Macartney BEIJING, Dec 14 (Reuter) - Premier Li Peng broke the
ground on Wednesday for the Three Gorges dam and appealed to foreigners
to transfer technology for China's largest and most ambitious engineering
project since the Great Wall. The ground-breaking ceremony for the 185
metre (607 foot) high dam that will cut across the Yangtze river and aims
to generate 18.2 million kilowatts of electricity on completion in 2009
follows a 40-year feasibility study and two years of preparatory work.
The success of the dam, the world's biggest water control project, will
involve the relocation of more than one million people from thousands of
farms, factories and towns who must move to make way for a huge inland
lake created in the Yangtze valley by the dam, Li said. "We must not
only handle the issue of resettlement well, we will also have to develop
the local economy of the Three Gorges dam area and raise local people's
living standards," the Xinhua news agency quoted Li as saying at the
lavish ceremony. Resettlement was the key issue on which the success of
the project would depend, he said, in remarks apparently intended to soothe
local grievances over being forced to leave land local peasants have farmed
for thousands of years.
With costs estimated at $12 billion by completion in 2009, opposition from
some local residents, and foreign investors yet to be convinced, Li has
a tough task on his hands to see through a pet project on which he has
staked his reputation, analysts said. Li has battled for the dam, overruling
environmental concerns, anger at the disappearance under water of the famed
Three Gorges and charges of economic waste, arguing the need to tame the
river and its floods when he pushed it through an unusually fractious parliament
in 1992.
The dam will control flooding along the middle and lower reaches of the
Yangtze, whose residents have been vulnerable for generations to the powers
of the raging river, Li said. Speaking as he broke the ground at Sandouping,
about 30 km (18 miles) upriver from the city of Yichang in Hubei province,
Li said the world's largest hydropower station would supply electricity
sufficient to meet the needs of much of central and eastern China, further
fuelling an economic boom in the region.
Total cost is estimated at 90 billion yuan ($10.5 billion) -- not including
interest payments and price increases that could boost the final bill to
more than 100 billion yuan ($12 billion). Total investment will amount
to 1.75 percent of gross national product (GNP) and to 4.29 percent of
total investment in state infrastructure during the 17-year construction
period.
Li said the dam offered unprecedented business opportunities for foreign
investors -- China's most overt effort so far to attract outside investment
in what has been jealously guarded as a domestic project since it was first
mooted in 1919. "In installing the hydropower generating units and
power transformation equipment, we will make use of the world's advanced
technology and equipment," Li said. "Manufacturers and businessmen
of large hydropower and transformation equipment from around the world
are welcomed to participate in the construction in the forms of technical
transfer or cooperation," he said.
Western diplomats have said China may have difficulties raising funds,
with costs likely to exceed estimates. More than 10,000 workers are already
employed at the site. Li said investment for the mammoth project would
be fully guaranteed, with funds raised both at home and abroad. Officials
have said China will need to borrow more than $3 billion in the next decade
to buy equipment and is considering raising funds abroad through issuing
overseas bonds, commercial foreign loans, and export credits.
Much funding will come from national increases in the price of electricity
as well as profits from the nearby Gezhouba hydropower station and loans
from the State Development Bank. Almost all China's 1.2 billion citizens
will contribute to the costs through their electricity bills, one official
said. The dam will cut the Yangtze in 1997 and is scheduled to begin generating
electricity in 2003, with all 26 power generating units to go into full
operation in 2009.
REUTER
Copyright, 1994. The Associated Press. All rights reserved. BEIJING (AP)
-- Construction of a dam that will wipe out a landscape celebrated for
centuries in Chinese art got its official start Wednesday at a ceremony
attended by Premier Li Peng.
The Three Gorges dam on the Yangtze River in Hubei province is the world's
largest hydroelectric project. There have been several reports in recent
months that construction had begun on the 610-foot-tall dam, but the ceremony
Wednesday in Yichang, Hubei province, appeared to mark the official start.
The beauty of the breathtaking cliffs at the Three Gorges has been extolled
for hundreds of years in Chinese paintings and poetry, but the cliffs will
disappear under reservoir waters when the dam is completed.
Critics say the dam will also harm the environment, jeopardize rare animal
and plant life, and aggravate flooding. The dam, they contend, will be
vulnerable to earthquakes. The government says the dam will provide desperately
needed electricity, control flooding, expand water supplies and raise the
river level so ships can navigate it into landlocked inland China.
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【北京１４日共同】中国・長江（揚子江）中流に建設される世界最大級の三峡ダムの着工式が１４日、湖北省宜昌市三斗坪のダム本体建設予定地で李鵬首相、鄒家華副首相、黄菊上海市長ら約６０００人が参加して行われた。新華社電によると、李鵬首相は「三峡ダム建設は洪水防止、発電、航路拡大など巨大な経済効果のある総合プロジェクト」と述べ、万難を排して建設を進めるよう指示した。
計画によると、ダム本体の高さは１８５メートル、幅２キロ、貯水量３９３億立方メートル。９７年に長江のせき止めを完成、２００３年に第１号機の発電を開始、２００９年に全面完成の予定。完成時の発電能力は年間８４７億キロワツト。
三峡プロジェクト開発総公司の賀恭・副社長によると、２００３年までの建設費用は当初予算を大幅に上回る１３００億元（約１兆５６００億円）が見込まれ、うち３−４割は海外資金を利用する予定。 難問は推定１６０万人に上る水没地域住民の移転。李鵬首相もこの問題が成否のカギになると指摘、大局を考え移転に協力するよう地元民に求めた。 三峡ダム建設計画に対しては、生態環境変化への懸念や建設費用が巨額に上ることなどから反対論も根強かった。 （了）
[1994-12-14-21:19]
BEIJING, Dec 15 (Reuter) - Construction of the world's largest hydropower
dam on China's Yangtze river will not affect the rare Chinese sturgeon
that live in its waters, the Xinhua news agency said on Thursday. China
has taken effective protection measures and successfully developed artificial
propagation to prevent this rare fish from becoming extinct, Liu Yong,
deputy director of the Chinese Sturgeon Research Institute, told Xinhua.
Premier Li Peng broke ground on Wednesday for the Three Gorges dam in central
Hubei province, a project that will be China's largest and most ambitious
engineering undertaking since building the Great Wall. The project will
have little impact on the fish known as the "fish king" of the
Yangtze, Liu said. The Chinese sturgeon, which measures four metres (13
ft) and weighs 500 kg (1,100 pounds) as an adult, is protected by the government.
The path of the Chinese sturgeon was cut off by the large Gezhouba hydroelectric
plant in the middle reaches of the Yantze 13 years ago, and since then
Chinese scientists have worked on artificial propagation of the fish. In
the past decade, China has poured two million baby Chinese sturgeons into
the river below the spillway of the Gezhouba dam, and these have now grown
to an average weight of 3.5 kg (7.7 lbs), Xinhua said. The Three Gorges
complex will be upriver from Gezhouba and therefore have less impact on
the sturgeon, Lu Youmei, general manager of the Yangtze River Development
Corp told Xinhua.
REUTER
China's Li Breaks Ground For Vast Dam on Yangtze; Disputed Project Will
Displace 1 Million People By Steven Mufson Washington Post Foreign Service
BEIJING, Dec. 14 - Premier Li Peng broke ground today for the Three Gorges
Dam, a massive hydroelectric project on the mighty Yangtze River that will
force more than a million people from their homes.
The dam's feasibility has been studied since the 1950s, when Li was still
an engineering student in the Soviet Union. But the project was repeatedly
delayed because of the cost, now put at $12 billion; the dislocation of
people, and the flooding of vast areas of farmland and historic sites beneath
a new inland lake that will be formed.
Li has been a strong advocate of the project. In breaking ground today
about 18 miles upriver from Yichang in Hubei Province, he said the dam
will generate enough electricity to meet the needs of much of central China.
The dam, the world's largest hydroelectric project, is to be 607 feet high
and generate 18.2 million kilowatts of electricity when completed in 2009,
the official New China News Agency said.
More than 10,000 people are already at the work site in Sandouping. "We
must not only handle the issue of resettlement well, we will also have
to develop the local economy of the Three Gorges dam area and raise local
people's living standards," the news agency quoted Li as saying at
the ceremony. Critics of the project, including environmental groups here
and abroad and political figures with competing demands for resources,
say that with a population of 1.2 billion people China can ill afford the
loss of so much arable land beneath a new man-made lake.
They also condemn the forced resettlement of more than 1 million people,
a process that began this summer. By comparison, the Aswan Dam forced the
relocation of 100,000 people in Egypt and the Sudan. The gorges are an
impressive sight, stretching more than 125 miles, ranging between 100 and
300 yards in width, with their cliffs rising sharply on either side. Archaeological
artifacts discovered in the region date as far back as China's Warring
States period, more than 2,200 years ago.
Moreover the cost is immense. Total investment in the project will amount
to 1.75 percent of the country's gross national product and to 4.29 percent
of total investment in state infrastructure during the 17-year construction
period, the news agency said. Critics also say that as big as the project
is, it will not solve China's energy problems. The dam would only cover
the incremental energy needed over a few months while the people and businesses
already working here might still be subject to the frequent brownouts that
occur in most places.
Supporters of the project assert that the dam will help control the flooding
that has plagued that region of China for millennia. Catastrophic floods
hit in 1870 and there was serious flooding four times between 1931 and
1954. Project boosters also say that the country needs solutions to both
its energy and its pollution problems and that the dam will provide clean
energy. They also say the amount of land lost will be modest considering
the amount of energy produced.
The Three Gorges Dam was first discussed in 1919. Although the government
wanted to preserve it as an exclusively Chinese project, Li invited foreign
companies today to invest and help cover the cost. Several American companies
hope to become involved in the project.
BEIJING, Dec 19 (Reuter) - China will need to raise $3-4 billion in foreign
funding to help to finance its huge Three Gorges dam project across the
Yangtze river, the China Securities newspaper said. More than $1.0 billion
of that will be required to purchase equipment overseas, it said. In the
17 years of construction from 1993 to 2009, the peak of demand for investment
will be from 2003 to 2006 as the first turbines are installed, the newspaper
said. "With the lack of capital at its largest (here), we need to
attract foreign capital to reduce the size of funds to be raised domestically."
It quoted officials as saying the 185-metre high dam that will cut across
the Yangtze and generate a total capacity of 18.2 million kilowatts on
completion in 2009 offered sound commercial opportunities since the project
is government backed. It cited two major opportunities for foreign funding.
The first, with the tenders for major equipment, includes turbines and
other power-generating equipment. Th second covers construction of factories
and buildings to complement building of the dam and hydroelectric facilities.
China was considering three ways to raise foreign funds -- issuing bonds
overseas, commercial bank loans and export credit. China expects to issue
bonds of more than 10 years and to seek preferential loans because the
project is state-sponsored with risk guaranteed by the government, it said.
Officials are also studying overseas stock markets and considering whether
to issue stocks in the future. Costs are estimated to reach $12 billion
by completion in 2009, or 1.75 percent of gross national product and 4.29
percent of total investment in state infrastructure in the 17 years of
construction. Western diplomats have said China may have difficulty raising
funds, with costs likely to overrun estimates.
REUTER
By Jane Macartney BEIJING, Dec 20 (Reuter) - China will issue international
bonds in early 1995 to raise some of the $3 billion in foreign funds it
needs to build the Three Gorges power plant that will dam the Yangtze river
and alter the climate of central China, officials said on Tuesday.
The dam, China's largest engineering project since it built the Great Wall,
will cost 146.8 billion yuan ($17 billion) including inflation and interest
costs, up from a basic price tag of 90 billion yuan ($10.5 billion), Guo
Shuyuan told a news conference. China plans to raise 21 percent -- or more
than $3 billion -- of that sum overseas and is already in talks with Merrill
Lynch, Goldman Sachs and Morgan Stanley on details of issuing international
bonds, the deputy director of the State Council Three Gorges Project Construction
Committee added.
Other foreign funds would come from commercial loans. "It is their
common view that in the initial period of construction it would be appropriate
to issue bonds," Guo said. China could issue the first bonds as early
as the spring of 1995.
Premier Li Peng broke the ground in a lavish ceremony near Yichang in central
Hubei province last week for the 185-metre (606-ft) high dam, which will
be the world's biggest water control project. Guo said the project, first
discussed 75 years ago and hotly debated in China for the last five decades,
faced problems such as sedimentation and fund-raising but said he was confident
these would be overcome. He dismissed fears the dam, which will create
a lake 663 km (412 miles) long and submerge 600 sq km (231 sq miles) of
Hubei and Sichuan provinces, would have a serious impact on the environment.
But summer temperatures in the region would fall by 0.5-1.0 degree Celsius
(0.9-1.8 degrees Fahrenheit) while in winter they would rise by 0.8-1.3
C (1.4-2.3 F) as a result of the reservoir. Foggy days would increase to
an average of 60 a year from 58, he said. "This will make the climate
more moderate in this area," Guo said.
Of the cost of the project, 50 percent would come from the Three Gorges
fund -- filled by cash injections from a hike in the national price for
electricity and profits from the upstream Gezhouba hydropower station.
Income from the dam itself would raise 7.5 percent after its first generators
go into operation between 2003 and 2005, while 17 percent, or 25 billion
yuan ($2.9 billion), would come in loans from the State Development Bank.
Another 4.5 percent had been raised through export credits of $600 million
for purchase of equipment overseas. "The shortfall of about 21 percent
of the total we will be raising through international financial markets,"
Guo said.
Premier Li has said investment for the mammoth project would be fully guaranteed.
Turbine generators for the first phase of the project, due to generate
total capacity of 18.2 million kilowatts on completion in 2009, will be
mainly imported, with major equipment purchases to be conducted through
bidding, Guo said. The first bidding for advanced construction equipment
will begin next year while bidding for the turbines and electrical equipment
will start from 1996, general manager Lu Youmei said.
The most intense demand for funding would be up to 2005, when the first
generators begin full production.
Controversy surrounding the dam, which requires the removal of 1.3 million
people and has sparked environmental concerns and anger at the inundation
of the famed Three Gorges, had prevented World Bank participation, Guo
said. "If we approached the World Bank for loans this could ignite
big debate that could impede progress, so we did not approach them,"
he said.
Premier Li has battled for the dam, overruling charges of economic waste,
arguing the need to tame the river and its floods when he pushed it through
an unusually fractious parliament in 1992. The dam is to control flooding
along the middle and lower reaches of the Yangtze, whose residents have
been vulnerable for generations to the depredations of the raging river.
The structure will cut the Yangtze in 1997 and is scheduled to begin generating
electricity in 2003, with all 26 power generating units to go into full
operation in 2009.
REUTER