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Cablegate: China Sparks Hydro Debate at Mekong River Commission

VZCZCXRO4464
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHBK #2682/01 2930950
ZNR UUUUU ZZH
R 200950Z OCT 09
FM AMEMBASSY BANGKOK
TO RUEHC/SECSTATE WASHDC 8670
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHCHI/AMCONSUL CHIANG MAI 7183
RUEHCN/AMCONSUL CHENGDU 0557
RUEHBJ/AMEMBASSY BEIJING 7606
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC
RUEHC/DEPT OF INTERIOR WASHINGTON DC
RHMCSUU/DEPT OF ENERGY WASHINGTON DC

UNCLAS SECTION 01 OF 03 BANGKOK 002682

SIPDIS
SENSITIVE

DEPARTMENT FOR OES & EAP
COMMERCE FOR NOAA
USDA FOR FAS
STATE PASS TO EPA, USGS, USACE,USAID

E.O. 12958: N/A
TAGS: SENV EAGR ECONQH
SUBJECT: CHINA SPARKS HYDRO DEBATE AT MEKONG RIVER COMMISSION

REF: 09PhnomPenh474

BANGKOK 00002682 001.2 OF 003


SENSITIVE BUT UNCLASSIFIED

1. (SBU)SUMMARY. The unprecedented active participation of Chinese
officials breathed life into the Mekong River Commission's
previously tame annual stakeholders meeting in Chiang Rai on October
15-16. Government and NGO representatives engaged in a lively
debate with the Chinese, who presented their own scientific studies
to show minimum impact from their proposed mainstream dams. They
said that environmental and social factors weigh heavily in their
dam decisions, and they want to be sensitive of the concerns of
downstream users. The head of the Chinese delegation suggested to
ESTHoffs that China and the U.S. begin a policy dialogue regarding
the lower Mekong countries, to enhance communication and perhaps
engage in joint projects. The meeting stimulated ideas on what the
USG can do to advance its Lower Mekong Initiative, such as support
for scientific studies, and some meeting reps said they are looking
for real commitment from the U.S. END SUMMARY.

MRC STAKEHOLDER PARTICIPATION
-----------------------------
2. (SBU) The Mekong River Commission (MRC) held its second annual
stakeholders meeting October 15 - 16 in Chiang Rai, Thailand. In
addition to representatives from the four member states - Thailand,
Cambodia, Lao PDR and Vietnam - there were representatives from the
MRC's two dialogue partners, Burma and China. The major donors to
the lower Mekong countries, including USAID equivalents SIDA
(Sweden), GTZ (Germany), AUSaid, and DANIDA (not present, but
sponsored) participated, as well as representatives of the Swiss
embassy, ASEAN secretariat and the European Commission. A number of
local NGOs active in river issues, as well as international NGOS
such as International Union for Conservation of Nature (IUCN), World
Wildlife Federation (WWF), and International Rivers took part.
Present also were representatives from the Stimson Center and
another U.S. consultant that have existing analytical projects in
the region. Regional ESTH Hub assistant and OES/PCI Asia officer
also attended.

CHINESE PARTICIPATION MAKES FOR A LIVELY MEETING
--------------------------------------------- ---
3. (SBU) China is a MRC "dialogue partner," along with Burma.
Earlier, MRC representatives told ESTHoffs that although there had
not been much active participation from China in the past, recent
cooperation had been good. MRC representatives had solidified plans
to take a study trip later this year to Yunnan to view dam sites and
discuss downstream effects. In the Chiang Rai meeting, China's
presence was a catalyst, forcing member countries to be more focused
and productive in their discussions, rather than using China's
absence as an excuse for not reaching consensus on difficult issues.
There were a total of six Chinese representatives, of which two
made substantial contributions to the meetings. Chinese Deputy
Director for International Organizations, Ministry of Foreign
Affairs, Mr. Lu Haitien, as head of delegation, was the principal
spokesperson. Mr. Zhou Shichun, a senior engineer from Ecosystem
Study Commission for International Rivers, made the main
presentation on environmental impact analysis of China's proposed
Lancang (upper Mekong) River dams.

4. (SBU) China's formal presentation centered on analyses of the two
dams in the process of construction on the Lancang River.
Mr. Zhou stressed key baseline features of the potentially affected
area: it is not heavy in fish, it is not a major source of flow for
the lower Mekong River, and riparian land is not generally used for
farming. The Chinese concluded that the two dams' impacts on the
environment were not significant. The Chinese reported that the
postponement of a third dam due to potential significant impact to
fish migration demonstrates their commitment to environmental
protection. Other interlocutors pointed out that, at least for the
lower Mekong flows, the number of migratory fish was so high and so
often during the year that models from colder rivers were inadequate
models to predict how many fish could survive fish ladders or
flow-through turbines (3 million per hour in Cambodia's Tonle Sap
Lake which drains into the Mekong River compared to a maximum 2
million per year in the U.S. Columbia River).
(Note: At the USGS DRAGON program summit in Siem Reap in June,
described in reftel, Chinese hydrologists from Yunnan presented data
that two existing mainstream Mekong dams did not affect
significantly downstream flow to Laos. Several participants noted,

BANGKOK 00002682 002.2 OF 003


however, that the dams on the Chinese Mekong would add an order of
magnitude to flow manipulation. End Note.)

5. (SBU) With regard to the Chinese assertion that the planned dams
would not significantly affect downstream flow, NGO representatives
asked what if in the future China were to need the water for
irrigation or human consumption in a way not planned now. The
Chinese responded that the upper Mekong is not an area that is
currently irrigated, that there are not many riparian farms and
there are no plans to channel this water elsewhere in China. Other
interlocutors noted that China could need more of the upper Mekong
flow, and thus reduce dam flow through, if climate change (e.g. the
reduction of water from Tibetan glaciers) or migration to the area
altered China's demand for upper Mekong water. The Chinese
participants stressed many times that they had important economic
interests in the Lower Mekong Region. They were participating in
the MRC meeting not just to talk, but to listen; they would take
back to their government not just the comments but the emotions
expressed at the meeting.

6. (SBU) A representative from Cambodia complained of improper
practices of Chinese companies. Mr. Lu responded by pointing out
that Chinese companies had invested and taken risks in Cambodia when
no other country would do so. He also urged the Cambodian
representative to report these poor practices to both the Cambodian
and Chinese governments so that the rule of law could be enforced.
Mr. Lu pointed out that if there were environmental problems with
Chinese dams, those problems would come back to haunt China and they
would lose face and influence in the lower Mekong. China stressed
that it was doing careful environmental analysis and that its
standards were stronger than those of the MRC. He compared
hydropower development to driving a car: an undeniable right, but
one that also comes with risks to oneself and others.

CHINESE ASK TO ENGAGE WITH THE U.S.
-----------Q----------------------
7. (SBU) In a private conversation, MFA's Q asked the U.S.
representatiQs to consider beginning a policy dialogue with China
regarding development in the lower Mekong Region; he said that China
already had a similar dialogue with Japan. He said that the
creation of a dialogue would eliminate the guesswork about each
other's activities, as well as reduce competition. Perhaps
establishing the dialogue at the director general level, he
suggested that we could first build trust and communication, and
then advance to potential joint projects. ESTHoff responded that
the proposal was of interest and said that the idea would be floated
in Washington to consider where such a dialogue could fit into
existing regional and bilateral relationships.

FOOD vs. ENERGY SECURITY
-----------------------
8. (SBU) As the effect on migratory fish from mainstream and
tributary dams was debated, so was the future of subsistence
fishing. Some participants noted that as trade corridors improve
with development, trade in the Mekong fishery could become more
profitable and therefore a more important part of the rural
economies. However, it was also postulated that the economic
benefits of this trend may not be sustainable if the markets for
high value species dominate, as would likely occur. Furthermore,
experts pointed out that as an alternative to sustainable fisheries,
aquaculture was not without its own environmental and economic
impacts. An NGO representative claimed development partners were
willing to invest in "fuel for cars" but not for "fuel for people,"
alluding to the fierce debate on the trade-offs between fisheries
and electricity in achieving development goals. Several local NGOs
noted that hydropower and fish-related food security issues were
already the main topics of local election platforms.

CAMBODIAN REP ASKS ABOUT U.S. COMMITMENT
----------------------------------------
9. (SBU) The Cambodian government representative noted that the
Lower Mekong Initiative, as he understood it, was welcome but
overdue - this appeared to him to be the first engagement of the USG
that affected Cambodia. He noted that USG efforts to recover
missing-in-action servicemen from the Indochina conflict were
well-known to Cambodians but not development assistance. The
Cambodian made the point privately that China is Cambodia's big
brother in the neighborhood, and Cambodia had to get along: was the
U.S. just passing through on a whim, or will this new Mekong

BANGKOK 00002682 003.2 OF 003


engagement be here to stay? He expressed the view that if his
country was being asked to choose between these two development
partners, it made sense to choose the one with regional proximity,
despite misgivings towards China.

COMMENT AND RECOMMENDATIONS
---------------------------
10. (SBU) Several gaps were apparent from the MRC meeting that could
provide avenues for USG cooperation and may be suitable topics of
discussion for the October 22-23 Lower Mekong Initiative meeting in
Phnom Penh. Much of the data and research on environmental impact
analysis of China's dam projects had not been translated into
English for regional or international audiences, and thus could not
be made available for peer review and critique. The local NGOs
exhibited not just capacity problems, but seemed to feel a lack of
validation that their views had been sufficiently incorporated into
planning. They were very concerned with disaster planning, whether
it originated from natural disaster or dam design failure. From the
science perspective, it was apparent from discussions with various
donors and NGOs that there had been insufficient data accumulated on
ground water, soil, and irrigated agriculture aspects of the lower
Mekong. While there had been studies of fish migration patterns and
the feasibility (for conservation purposes) of dams that permitted
fish to migrate, there was not enough consensus on the science to
make decisions clear-cut for policy makers. Finally, a regional
environmental regulatory framework would be needed to reduce unease
with China's unilateral ability to capture and release upstream
water flow with the construction of dams.

11. (SBU) The USG's Lower Mekong Initiative could be used to bring
greater regional clarity to the key political debates on food
security, energy security and poverty reduction, and climate change.
Each year there is normally an International Visitor Program (IVP)
which targets NGO capacity building; for the next cycle a
LMI-oriented IVP could help build capacity for the NGOs that work on
lower Mekong fishery issues, with the goal of them becoming
responsible and effective actors. Other IVPs could study
irrigation, groundwater, and soil components of river use. (Note:
Embassy Bangkok will soon have a USDA soil/water Embassy Science
Fellow for three months to assess the state of knowledge in Thailand
and if possible some of the other lower Mekong countries. End
Note.) Another IVP could study hydropower in the U.S., especially
smaller scale hydropower, as an earlier trip dealt with large scale
projects built many years ago. The U.S. Army Corps of Engineers is
redesigning a Snake River turbine in Washington to improve fish
survival, and is interested in sharing lessons learned from their
research. A profitable IVP could take resource managers to Alaska,
where migratory fisheries are managed for native subsistence,
commercial and tourism uses. END COMMENT.

ENTWISTLE

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