Executive Summary
November 2000

China, the world's most populous country, has one of the longest traditions of water resources and river management in the world. The civilisation has sought to control the effects of floods and drought in some of the world's largest river basins for many thousands of years, and utilise the water flows for irrigation and navigation. In the last century hydropower and municipal and industrial water supply have also become reasons for the regulation and or abstraction of water flow in rivers.

Today China is at a crossroads in water and energy development. This is in respect to selecting the way forward to achieve sustainable development and in making strategic choices among the different visions of regional development. Among the factors that have enter the discussion within China's of it strategic options for future water resource development and management include: the apparent increasing severity of the effects of flooding and drought and implications for the economy, and threat to lives and livelihood; growing scarcity of surface and ground water resources in many regions, and growing competition for available resources; net losses of agriculture lands with encroachment by urbanisation, soil erosion and loss; and, changing social development priorities centring on concerns over the displacement impacts of large infrastructure projects. Finally there is growing understanding concern over the progressively deteriorating state of the environment including land, water and air quality and the ecosystem effects as well as the longer term viability of water resource projects.

Recently China has been undergoing two major, interrelated transformations that have a profound influence on all aspects of life in the PRC. These transformations also underlay changes in patterns of demand for water and energy services, and influence decision-making on water and energy sector and broader development programmes. They also shape views of what sustainable development actually means, and the priorities for management of existing infrastructure and the evolving legal and institutional arrangements. The first is the accelerated pace of transformation from a rural agrarian society to a more urbanised industrial society. At present China is just over 30% urban. With current trends China is projected to be up to 60% urban by 2050. Increasingly the demand will be concentrated in larger urban centers. One indication of this trend is that agriculture GDP fell to less than 20% of overall GDP in the mid 1990's. The second major transformation is the shift from a centrally planned to a socialist market economy. These transitions broadly have led to, or promise to lead to, greater openness and a devolution of centralised control with the adoption of more localised decision-making and reliance on market forces, in a socialist political context.

There is evidence of a more open debate in the People's Republic of China which is similar to the debate occurring world-wide on the future direction of water and energy resource development and the rate of progress in addressing problems that remain from the past. It is more specifically focused on the role that dams and non-dam alternatives may play, and the choices that are made among them either as complementary or mutually exclusive means of achieving sought after sustainable development outcomes, recognising the very unique circumstances in China and special challenges that it faces.

China's physical situation as regard to water and energy resource development is somewhat unique in world terms, for many reasons - including those of the sheer scale and magnitude of the challenges it faces in providing water and energy services for over 1.2 billion citizens. To date, in attempting to do so, it has built almost half of the world's estimated 45,000 large dams. And China remains one of the most active dams building countries today. Dams have and continue to be built for flood management, irrigation power and water supply and enjoy considerable political and institutional support. In doing so China has also been involved in the displacement of more people and the alterations of more rivers than any other society.

Over 22,000 of the estimate 85,000 significant reservoirs and dams in China are considered as large dams, though there are perhaps a few million small-scale and localised water diversions, check dams and weirs built by local collectives or individual farmers that are unrecorded. China has thus built more the three times the number of large dams than the USA and over five times the number in India. Virtually all these dams were built since the founding of the People's Republic of China in 1949, as only 22 large dams apparently existed before that time. What is remarkable is that this was undertaken in parallel with the construction of many thousands of km of dykes, levees, retention basins, pumping schemes and other schemes on China's river systems. 

A considerable portion of China's inventory of large dams were actually built in the 1950's and 1960's. Thus while China is adding to its inventory of large dams, much of China's existing infrastructure for large-scale water and energy resource projects is ageing. The management of existing dams is seen to be increasingly important, not only because of the numbers, but for reasons of safety, restoration, modernisation and adapting operating practices to the circumstances of today. The optimisation of existing dams and reservoirs in the context of an integrated basin development plan is also seen to be an essential way forward to address cumulative impacts and reconcile competing demands for water between nature and human activities that are increasing and have in some basins such as the Yellow River reached critical thresholds. There is also growing concern about the risk and uncertainty of climate change, where river basin management practices and development planning will have to take into account likely changes in the flow regimes of China's rivers.

The Chinese circumstances and debate links to international concern for water and land use and sustainable development more generally. The limited availability of water and of land suitable for agriculture is recognised as being the greatest challenges facing humankind in the 21^st century. In China as in other parts of the world opportunities for tapping unused water resources or finding unused land suitable for agriculture are increasingly limited. The option of damming more rivers for water and ploughing grasslands or cutting forests to provide land for agriculture has come under increased scrutiny. 

The issues are particularly acute in China because of the rising standard of living of many of its 1.2 billion people, and China after the devastating experience of the Cultural Revolution is particularly aware of the need to ensure adequate food supplies for its population. Food security remains a national priority. Nonetheless, with past approaches in water resources development and current management practices major river systems are drying up, groundwater aquifers are increasingly over exploited, water pollution is becoming a major concern and competition for water between communities, sectors of the economy and between provinces is growing. The situation is not uniform throughout the country. Some regions are water stressed while other suffer from excess water in the form of flood and waterlogged soils. New strategies for meeting the human need for water supply and food production thus have to be found in China, perhaps more than in many other part of the world. The use of water and land must be carefully and strategically planned, efficiency of use optimised, infrastructure modernised and financial resources and its highly educated and capable human resources redirected to achieve this. China cannot avoid making far reaching strategic decisions related to its land and water resources and must address many challenges in doing so.

The purpose of this paper is to provide an overview of water resources development in the People's Republic of China (PRC), and background information on the benefits and concerns of large dams. This is to provide an input to the WCD process on the issues around the development effectiveness of dams worldwide. This paper identifies and examines some of the strategic challenges China faces in its water and energy resource development plans and programmes; as well as the policy, legal, institutional framework that is evolving for decision-making. The paper also looks at the environmental and social issues and the scope and challenges for integrated river basin planning and management that are increasingly highlighted in policy statements, but otherwise appear to be a very promising direction, but slowly emerging.

Section 1 looks at the context of the dam debate in China and provides a profile of its dam building programme and financing. Section 2 of the paper then looks more closely at the land, water and energy resource situation and challenges China faces in developing these resources. Section 3 looks at the evolving development policy environment and the legal, regulatory and institutional framework for water resources planning and management. Section 4 considers the scope and potential for some of the non-dam alternatives. It also provides a more in-depth illustration of two specific strategic challenges that China faces by way of describing how it is approaching flood management on the Yangtze river, and the water scarcity problem in the North China plain where transbasin diversions are now being considered. Section 5, looks at some of the issues and the evolving practices in social and environmental management related to resettlement and large dams.

The Annexes to the paper provide general descriptions of three large dams, and examines  some of the controversies and the manner in which the government is approaching the local and regional development issues, as well as social and environmental challenges. These projects include the Three Gorges project, the largest water and energy resource project in the world (intended primarily for flood defence in the middle and lower reaches of the Yangtze) and power generation, the Xiaolangdi project and the Shuikou project. The Shuikou write-up focuses mainly on the resettlement component of the project and suggests what is considered to be emerging good practice in the implementation of China's resettlement policies, and provides a set of lessons learned.

The Appendix provides comments that were received from the different constituencies in the dams debate on the draft version of the paper circulated in March 2000. The perspectives expressed range from highly critical views of China's water and energy management policies and practices, particularly those on resettlement and environmental management, to those supportive of the direction of China's evolving policies, programmes and practices.