AUNG MYIN THA, Myanmar—For six years, Daw Kaw Bu has waited to return to the village she was forced to leave to make way for a dam that has yet to be built.
“I pray to God to let me work on my own land again,” she said on a recent afternoon, sitting outside the wood-shingled home in Aung Myin Tha, where she was resettled in early 2011.
She may get her answer soon, when a government-appointed commission makes a recommendation on the fate of the $3.6-billion, Chinese-financed Myitsone Dam.
The decision is a daunting test for Myanmar’s leader, Daw Aung San Suu Kyi, who risks angering China, the region’s economic powerhouse, if she cancels the project, or the public if she lets it go forward.
Analysts say the commission’s report would provide her the political cover to kill an unpopular white elephant that she inherited from Myanmar’s former military government.
But getting out of the deal would be difficult. If her government cancels the project outright, it could have to repay some $800 million the state-owned Chinese developer says it has already spent on the project.
If Myanmar offers China other dam projects in return, a compromise her government has floated, they are likely to impinge on disputed ethnic areas where they could threaten the peace talks she has championed since her political party came to power last year.
“If she is the leader she claims to be, I think she should cancel” the dam, said Yun Sun, a specialist on China-Myanmar relations at the Stimson Center, a nonpartisan think tank in Washington. “But then she has to somehow deal with an $800- million disbursed investment: It cannot be swept under the carpet without giving China something major, and I cannot think of anything that she could give to China without generating a bigger pushback.”
The Myitsone Dam is among the largest of many Chinese-financed energy and mining projects approved by the military junta that ruled Myanmar until 2011. It is especially contentious because it would be the first dam to cross the Irrawaddy River, the mythic cradle of civilization for Myanmar’s ethnic Burman majority.
But as Myanmar moved toward democracy, and controls loosened on public expression, rising anti-Chinese sentiment burst into the open, and the dam became a focus of protest. While officials said the dam would provide Myanmar much-needed cash and electricity, critics said it would cause irreparable harm to the river, destroy fish stocks downstream and displace thousands of villagers.
But perhaps the most incendiary objection was that under the deal struck by the ruling generals, 90 percent of the dam’s electricity could go to China. As protests spread to Myanmar’s cities, Suu Kyi, the country’s revered prodemocracy leader at the time, spoke out against the dam.
In 2011 the military-backed transitional government yielded to public pressure and suspended the project.
The decision, widely seen as a victory for the forces of democracy, shocked Chinese officials and businessmen. Many remain incredulous that the dam was delayed at all in a country that needs more electricity to power its fast-growing economy.
Although the contract has never been publicly disclosed, details have leaked out over the years. A person who supports the dam and is familiar with the contract, who spoke on the condition of anonymity, said Myanmar was guaranteed 10 percent of the dam’s electricity at no cost and could buy more on request.
The government’s 15-percent stake in the dam would earn it about $18 billion over a 50-year concession period, analysts and local news reports said.
Asia World, a domestic conglomerate with deep ties to the military and roots in the heroin trade, owns 5 percent and also stands to profit handsomely, they said. Asia World is subject to US sanctions because of its ties to the junta.
The Chinese developer owns the remaining 80 percent.
The Myitsone was meant to be the first and largest of seven dams planned by the Chinese developer. It would generate more power than the entire country produces now, according to some estimates, but would still not cure the country’s chronic energy shortages.
One reason for that, experts say, is that there is no grid connecting the dam to Myanmar’s major towns and cities.
“Does Myanmar need electricity? Yes, for sure,” said David Dapice, an economist at Harvard who has studied Myanmar’s hydropower sector. “Does it need Myitsone? No. There are many other hydro sites that could be developed. And in the country’s south, gas generation would be cheaper than transmitting hydro over long distances.”
Canceling the dam, however, would upset relations with China, Myanmar’s biggest trading partner.
Recognition is growing among Chinese officials and experts, analysts said, that the diplomatic and business strategies that worked well when Myanmar was ruled by generals are no longer viable.
“We’ve learned our lesson from focusing too much on the elites, and now we know that deals and agreements are not solid if they are not based on people-to-people relations,” said Fan Hongwei, a Myanmar specialist at Xiamen University in China.
Image credits: Minzayar Oo/The New York Times