The confluence of the Ayeyarwady River and the Mali and the N'Mai rivers. The Myitsone dam was to be located a mile downstream of this point. Photo: Yu Jincui/GT

Upstream of the Ayeyarwady River, also known as the Irrawaddy River, the night was terribly quiet. Standing at the Myitsone construction camp on the right bank, one could only hear crickets chirping and dogs barking. This was once the bustling command center for a hydroelectric mega-project with a total investment of $20 billion from China Power Investment Corporation (CPI), but now the only people here are a group of 17 staff responsible for PR work and assisting resettled villagers.

The suspension of the Myitsone dam project in September 2011 jolted China-Myanmar bilateral relations. Two years on, prospects for the project are as murky as the causes for the abrupt halt.

Who pulled the plug?

On October 31, 2006, then Myanmar prime minister U Soe Win approached CPI at the opening ceremony of the third China-ASEAN Expo, seeking investment for developing hydropower projects on rivers such as the Ayeyarwady and Chindwin. In 2009, the Chinese and Myanmar governments signed a framework agreement for cooperation, providing solid support for a plan to develop seven large hydropower plants in the upstream Ayeyarwady river basin.

On September 30, 2011, Myanmar President U Thein Sein announced the suspension of the Myitsone project.

Li Guanghua, general manager of the Upstream Ayeyawady Confluence Basin Hydropower Co. Ltd (ACHC), a Sino-Myanmar joint venture that manages hydropower resource development in Myanmar, recalled the sudden halt with the Global Times. "A project officially agreed and contracted by both Chinese and Myanmar governments was unilaterally forced to stop without any consultations or warnings; it was unreasonable in procedure."

Li admitted that from the very beginning, there had been opposition to the project due to the dam's environmental and social impact by some activists and NGOs such as the Burma Rivers Network and the US-based International Rivers. However, there had been no local large-scale protests similar to recent ones against foreign-invested projects.

"NGOs and some civil society groups dictated the media discourse, which was crucial to the project's suspension," Bi Shihong, a professor at the School of International Studies at Yunnan University, told the Global Times.

On the same day that Myanmar declared a halt to the project, the Guardian exposed a US diplomatic cable signed by then US charge d'affaires, Larry Dinger, which revealed that the US embassy in Yangon funded groups that stalled the project.

Critics say the Thein Sein government needed to prove they were reforming. Support for the administration appeared internally and internationally after the project was suspended. Speaking to the Global Times, Nan Khin Htwe Myint, one of the 15 members of the central executive committee of Myanmar's biggest opposition party, the National League for Democracy, called Thein Sein a "robot" of the former military junta, but she agreed that suspending Myitsone was the decision of "all the people" to end a non-transparent deal between investors and the former military government.

Over the past two years, Li networked among Myanmar's officials, opposition parties, environmental NGOs, media and local villagers, seeking support for a road map to solve the issue, but didn't get many responses from the government of Myanmar.

Kids in the kindergarten of the Maliyan Village of Myitsone Hydropower Project. Photo: Yu Jincui/GT

Tricky prospects 

The Myitsone project has become a hot potato. Gao Mingbo, head of Political and Information Section of the Chinese Embassy in Myanmar, told the Global Times that the current Myanmar government has shied away from the Myitsone issue in bilateral contacts.

"If the project's prospects are to improve, this likely won't happen until 2015, after elections in Myanmar bring in a new government," Michael Kugelman, program associate for South and Southeast Asia at the Washington-based Woodrow Wilson International Center for Scholars, said. Bi also warned that presidential candidates could use Myitsone as an issue to woo voters.

There are also NGOs and groups calling for the project to be scrapped. U Lh Ram, a Kachin man who resettled in the Aung Myin Thar Village of the Myitsone Hydropower Project, sent an anti-Myistone dam brochure when talking with the Global Times. He was resettled from a shabby wooden hut to a brick and wood two-story house in 2010. Lh Ram complained he was asked to relocate by the government and accept the compensation without knowing what it was, also saying that their newly reclaimed land is not fertile and far from where they live. But when asked whether he wants to move back to his old residence, the man shook his head firmly.

The brochure, titled Unheard Voices, contained extreme hatred toward the Myitsone project, listing negative influences on the economy, religion, culture, education and environment, among others. There are dozens of similar brochures at Lh Ram's home, but he refused to say where they came from. In this brochure, villagers are seen giving money to kids and buying motorcycles after receiving compensation, the negative implication being that they now have more money to spend on decadent pastimes.

Jiang Lizhe, deputy director of the Department of Public Affairs of the ACHC, told the Global Times that some organizations have instigated opposition to the project with false and biased information.

"The Myitsone project should never be restarted," Htun Myint Aung, a leading member in charge of the Farmers' Affairs Committee at the 88 Generation Students Group, which is famous for organizing several petitions and democracy protests in Myanmar, told the Global Times.

He claimed the dam is located in an earthquake-prone area, and if the dam breaks, it could flood Myitkyina, the capital of Kachin State as far as 40 kilometers away and that the project will benefit China more than Myanmar.  He also claimed that it will lead to the drying up of the Ayeyarwady River, affecting millions of rice farmers and transportation along the river. Most importantly, he said the confluence of the Ayeyarwady River, the Mali River and the N'Mai River, where the dam is located, is a unique piece of scenery loved by all the Myanmar people and seen by the Kachin people as the origin of their culture.

Jiang from ACHC dismissed these concerns. He said that there is no active fault within the scope of seismic safety of the Myitsone site, and the dam itself is designed to withstand a 9-magnitude earthquake. Part of the Myitsone project includes the construction of a reservoir upstream which can increase water supply during the dry season. Jiang also said they visited the heads of the six peoples in Kachin State, including the Kachin people, when investigating the possibility of building the dam and gained their support. A public participation survey, jointly conducted by the Chinese company and the local government, indicated that 80 percent of the local people support the project.

A Kachin journalist who reported on the latest round of peace talks between the Kachin Independent Army and the government told the Global Times, "The conflicts are continuing, how should the Myitsone project restart?" He held that although a seven-point agreement was reached during the talks and the government put forward the ambitious goal of national reconciliation at the beginning of 2014, too many unknowns remain. While the dam site is located in an area under the control of the Myanmar government, the other six plants are in regions where the KIA and the governmental army are in conflict.

Surgical apparatus in the newly built hospital of the Aung Myin Thar Village of the Myitsone Hydropower Project, left untouched due to lack of electricity and surgeons. Photo: Yu Jincui/GT

Light out of darkness

The Thein Sein government seeks to build Myanmar into a developed country by 2030. But as one Myanmar businessman said bitterly to the Global Times, "Without electricity, how to achieve the goal?"

Official statistics show that 70 percent of Myanmar's towns, villages and cities are plagued by power shortages. In Kachin State, the city of Myitkyina was in darkness for nearly two months since August when floods damaged the local power source, a small hydropower station. In the two resettled villages of the Myitsone Hydropower Project, computers and surgical apparatus in the rebuilt school and hospital are left untouched since electricity can only be supplied free for three hours in the evening. This would be considered a luxury by other villages along the Ayeyarwady River, where people live in extreme poverty without power supplies.

The Ayeyarwady River possesses about 30,000 MW in potential hydropower resources. "The Myanmar people are blessed to have this wealth and should make good use of it," Li from ACHC said. Based on the current agreement, Myanmar would receive 10 percent of the power for free, equivalent to the total electricity generation in the country in 2011, and stands to gain $54 billion in revenues during the project construction and concession period, which could be used to boost the economy.

Gao Mingbo from the Chinese embassy said, "Chinese companies are drawing a lesson from the Myitsone issue, and so should the Myanmar government. If a country cannot safeguard investors' interests or have a sound and credible investment environment, how can it attract investment?"

Bi suggested that Chinese companies remain patient on the Myitsone dam project. "The democratic frenzy among Myanmar people will cool down. They are blindly opposing mega-investments since they now have the opportunity to express their resentment for the military junta. But they will finally realize that without infrastructure like roads and electricity, they will remain in poverty, and gradually become rational."