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Cablegate: Realizing Mao's Vision of Water for the North in Time For

VZCZCXRO4270
RR RUEHAST RUEHHM RUEHLN RUEHMA RUEHPB RUEHPOD RUEHTM
DE RUEHBJ #3030/01 2190300
ZNR UUUUU ZZH
R 060300Z AUG 08
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC 8999
INFO RUEHRC/DEPT OF AGRICULTURE WASHDC
RUEHC/DEPT OF INTERIOR WASHDC 0730
RUEAEPA/HQ EPA WASHDC
RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUEHCN/AMCONSUL CHENGDU 9337
RUEHGZ/AMCONSUL GUANGZHOU 4241
RUEHGH/AMCONSUL SHANGHAI 9300
RUEHSH/AMCONSUL SHENYANG 9005
RUEHHK/AMCONSUL HONG KONG 0446
RUEHIN/AIT TAIPEI 7031

UNCLAS SECTION 01 OF 04 BEIJING 003030

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: SENV TBIO PREL CH
SUBJECT: Realizing Mao's Vision of Water for the North in Time for
the Olympics

REF: 06 Beijing 14816

BEIJING 00003030 001.2 OF 004


SUMMARY
-------

1. (U) With the start of the Beijing Olympics set for August 8,
Northern China's water shortage has received widespread attention in
both local and international press, with accounts of what the
Chinese government has done in recent years to address the problem.
Instead of addressing the water shortage of northern China at the
source of the problem, the government decided in 2002 to back an
engineering project larger in scale than even that of the Three
Gorges Dam: The South-North Water Diversion Project. Numerous
problems have arisen in constructing this project. The Central and
Eastern Routes have funding and pollution problems. As for the
Western Route, the costs and risks exceed the likely benefits and
the route has been suspended indefinitely. If the Chinese
government wants to solve the ever deepening water crisis, demand
management practices such as water conservation and improved
agricultural practices need to be pursued rather than a costly water
diversion solution. END SUMMARY.

BACKGROUND
----------

2. (U) Mao Zedong himself first conceived of the idea for
transferring water from southern China to northern China and, in the
1950s, the Yellow River Committee (YRC) began initial planning.
While over 300 plans have been proposed, only three were eventually
selected by the YRC for development. The three plans combined now
comprise the project known as the South-North Water Diversion
Project (SNWD). An Eastern Route will divert water from the Yangtze
River into the Grand Canal at Jiangdu City in Jiangsu Province and
then cross the Yellow River via tunnel and flow to Tianjin. The
Central Route uses the Danjiangkou Reservoir in Hubei Province as
its source. Using a series of canals, the water will be diverted
through Hebei and Henan to supply Beijing. The Western Route calls
for diverting water from the Dadu, Tongtian, and Yalong rivers,
tributaries of the Yangtze River, across the Qinghai-Tibet Plateau
and through the Bayankala Mountains. The water would then be
diverted into the Yellow River to replenish the water stocks already
flowing eastward to supply Beijing and Tianjin.

CENTRAL AND EASTERN ROUTES PROCEEDING SLOWLY
--------------------------------------------

3. (U) On June 13, 2008, ESTH officers met with officials and
engineers from the Office of the SNWD Project Commission to discuss
the current status of SNWD. (NOTE: The SNWD Project Commission
reports directly to the State Council. END NOTE) The officials
stated that the construction of the Eastern and Central Routes is
proceeding smoothly, and that the government is maintaining both
construction safety and quality standards during the process. As of
the date of the meeting, about 60% of the Eastern Route projects had
been completed; however, there is no definite timing for the
completion of the Central and Eastern Routes. The SNWD Commission
officials said they are currently awaiting the State Council's
approval of recently-submitted General Feasibility Study Reports for
each of the routes before they can proceed.

4. (SBU) Yang Yong, an independent researcher with the Hengduan
Mountain Society, a Chengdu-based NGO, told ESTH officers recently
that the Central and Eastern Routes have had funding problems due to
local governments along the routes being unwilling to contribute
resources to the water diversion project. According to SNWD
interlocutors, local officials' unwillingness is caused by the
uncertainty of compensation for ecological damage and the ability of
provinces along the route to enjoy the benefits of an equitable
water distribution and pricing policy upon completion of the
project. For example, the Central Route goes through Hebei
Province, but it is unlikely that water will be provided to Hebei,
thereby offering little incentive for Hebei to help fund the
project. In addition, according to press reports, the government
has ordered farmers to plant cops that consume less water and
produce les income, such as wheat and corn in place of rice and
vegetables, instead of allowing them to tap the new waterways.
(COMMENT: When the rural population is left impoverished and without
ater while Beijing benefits from a costly waer project, it's no
wonder there is no suppor from local governments. END COMMENT)

POLLUTION AND SALTWATER INTRUSION HAMPER EASTERN ROUTE

BEIJING 00003030 002.2 OF 004


--------------------------------------------- ---------

5. (U) Water pollution is a significant concern along the Eastern
Route, which runs through highly industrial areas of Jiangsu
Province. The budget for construction of the Eastern Route is said
to be 100 billion RMB (14.6 billion USD); whereas its pollution
control cost is estimated to be 600 billion RMB (87.6 billion USD).
Pollution control measures in the process of being implemented
include building urban sewage plants, using recycled water, and
adjusting industrial practices. The Office of the SNWD Project
Commission told ESTH officers they are confident the construction
will eventually lead to an improvement in water quality along the
Eastern Route. (COMMENT: Unless measures to curb pollution at the
source also are properly implemented, no amount of controls along
the route will significantly improve the quality of the water being
diverted. END COMMENT)

6. (U) The diversion of the Yangtze River as part of the Eastern
Route may also cause salt water to contaminate the Yangtze Estuary
at Shanghai, where the river meets the ocean. To prevent this, the
project plans for less water to be pumped during the dry season from
December to February. By diverting less water from the Yangtze, the
Yangtze's water level will be high enough to prevent the ocean's
salt water from flowing into the river.

OBSTACLES ALONG THE CENTRAL ROUTE
---------------------------------

7. (U) The Central Route's main problem is insufficient water
resources at the intended source. A recent report on the SNWD
states that the Danjiangkou Reservoir in Hubei Province, the water
source for the Central Route, can now only divert an estimated 9.7
billion cubic meters of water, which is lower than the original plan
of 14 billion cubic meters.

8. (U) Pollution is not as serious of a concern for the Central
Route; however, to prevent any new pollution as the water is
transported along the route, a Danjiangkou Pollution Prevention and
Water/Soil Conservancy Project has been initiated. The project
intends to maintain Danjiangkou Reservoir's water quality at a
standard of at least Class II (on China's five-level water quality
scale, with I being best and V being the worst).

WESTERN ROUTE OVER BUDGET AND STALLED
-------------------------------------

9. (U) The Western Route is currently still in a feasibility study
and project proposal stage. According to the original plan devised
in 2002, inauguration of the Western Route was set for 2010;
however, this estimate has been postponed indefinitely. According
to Yong, in 2007 members of the National People's Congress raised
concerns about potential geological complications in the Hengduan
Mountain area and the availability of water resources in Qinghai,
the proposed water source. The report prompted the Ministry of
Water Resources (MWR) to call for postponement of the current work
on the Western Route. The current cost estimate for the Western
Route is 500 billion RMB (73 billion USD). This is almost double
the amount budgeted in 2000 of 300 billion RMB (43.8 billion USD).

SEISMICITY MAKES WESTERN ROUTE UNREALISTIC
------------------------------------------

10. (U) It is widely accepted that earthquakes in the Hengduan
Mountain Region in Sichuan Province pose a significant risk to the
Western Route. Yang noted that after the Sichuan earthquake on May
12, 2008, many of the existing dams and those under construction in
the Hengduan Mountain region were damaged, despite officials' claims
that the Sichuan earthquake did not directly affect structures
within the SNWD project. Yang believes that due to the proximity of
the Western Route to the earthquake prone region, another earthquake
could cause substantial damage to the Western Route if development
continues. The total water diversion volume for the project is
expected to be about 45 billion cubic meters per year. With such
quantities of water being shifted, changes in pressure on the
bedrock below can result in induced seismicity. Yang said that
several geologists around the world believe the Zipingpu Dam may
have triggered the Sichuan earthquake in May; this suspicion is due
to the close proximity of the earthquake's epicenter to the dam's
reservoir, a distance of five kilometers. In addition to seismic
activity, there is also potential for flooding. Most of the
reservoirs along the Yellow River are small and insufficient for

BEIJING 00003030 003.2 OF 004


handling the increase in reservoir storage capacity needed during
flood season. If heavy rains cause the flow of the Yellow River to
increase beyond available reservoir storage capacities during flood
season, there will be an increased risk for widespread flooding.

11. (U) Yang noted that along the Western Route, pollution does not
pose a major concern because there is not much industry along the
route. What is of greatest concern is the mineral content of the
water; for example, mercury levels currently exceed standards deemed
safe for human consumption.

AN ALTERNATIVE TO THE WESTERN ROUTE
-----------------------------------

12. (SBU) With the Western Route now suspended indefinitely, Yang
Yong described to ESTH officers an idea for an alternative water
source for the Western Route. The alternative source would be water
from melting glaciers in the Kunlun and Qilian Mountains, on the
border between Qinghai and Gansu Provinces. The volume of water
from the melting glaciers is estimated to be 25 billion cubic meters
per year, or 36 billion cubic meters per year total including
melting snow. (NOTE: Both these volumes are larger than the Western
Route's total planned water diversion volume of one billion cubic
meters per year. END NOTE) Currently, only ten percent of this water
is being collected and used, with the rest seeping into the desert
or evaporating in southern Xinjiang. In addition, scientific
reports show that there is ground water in the Taklimakan Desert
south of the Tarim Basin. These water sources are currently being
explored to determine suitability for supplying local populations.
Yang stated that scientists from the Institute of Ecology and
Geography working in southern Xinjiang are quite familiar with the
melting glacier and ground water resources, but their input is
rarely sought or adopted by SNWD officials nor by the Yellow River
Commission, which historically has been protective over its control
of the SNWD.

CULTURAL SITES
--------------

13. (SBU) In addition to environmental issues, the construction of
the SNWD project also has social impacts. While over 700 cultural
heritage sites will be affected by the SNWD project, only 50 million
RMB has been approved to protect 45 sites along the Central and
Eastern Routes. As for the Western Route, since Tibetans consider
the Qinghai-Tibet Plateau to be a holy land, and any alteration of
the mountains, lakes, and natural environment is strictly forbidden
by Tibetan Buddhism, its construction could lead to conflict with
the indigenous population.

EMERGENCY WATER LINE FOR THE OLYMPICS
-------------------------------------

14. (U) Five hundred thousand additional visitors are expected in
Beijing for the August 2008 Olympics. Since none of the main SNWD
routes will be completed in time for the Olympics, the potential for
water shortages is being addressed with the construction of a
short-term emergency line from four reservoirs (Wangkuai, Xidayang,
Gangnan, and Huangbizhuang) in Hebei Province to Beijing, which has
already been completed and performance tested. A test operation was
scheduled for June 24, 2008. Although results of this test have not
been officially reported, the emergency line is not currently in use
and reportedly will be tapped only when normal supplies become
insufficient. According to press reports, Guangting and Miyun,
Beijing's two largest reservoirs, currently store more than one
billion cubic meters of water. Officials estimate that Beijing will
need 200 to 300 million cubic meters of water for visitors during
the Olympics. (COMMENT: Because of water from recent rains, Beijing
will not likely experience a water shortage during the two week-long
games, nor will there be a need to bring the emergency line into
action. END COMMENT)

COMMENT
-------

15. (SBU) If Beijing does not implement more stringent water
conservation methods to address excess demand, no amount of diverted
water will prevent the northern region's impending water crisis.
Instead of simply relying on an increased water supply, the Chinese
government needs to improve demand management across all sectors
that consume water by promoting more efficient agriculture
irrigation systems and less wasteful industrial water use practices

BEIJING 00003030 004.2 OF 004


through price reforms. While the Eastern and Central Routes might
ultimately serve their intended purpose, should China decide to
continue pursing the Western Route, the project could lead to an
irreversible drain on government funds with ever-increasing costs on
top of an already staggering price tag. Despite assertions that the
May earthquake did not affect the central government's financial
support for the SNWD, it is difficult to believe that the budget
will not at least be trimmed, given that official expenditures are
being cut at all levels, and that local and provincial governments
are increasingly being ordered to contribute to the earthquake
reconstruction cause. Finally, in the unlikely event that the
project is completed in its entirety by its original deadline of
2050, the water crisis may have intensified to such a point that the
amount of water the project is able to supply will have already
become insufficient, making it necessary to find an entirely new
solution.


RANDT

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