China signs new hydropower deal with Myanmar

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AFP 7 April 2007

Military-run Myanmar and China have signed a deal to build a hydropower dam on the Salween River, as yet the longest undammed waterway in southeast Asia, official media said Saturday. The deal is the fourth hydropower agreement signed with China this year, and came just days after Thailand began work on a six-billion-dollar dam on the Salween to generate electricity that will be carried back to the kingdom.

Activists warn the dams could prove disastrous to the Salween's delicate ecosystem and accuse Myanmar's military junta of using the dams as an excuse to evict thousands of ethnic minority villagers from their land.

Myanmar's Hydropower Implementation Department signed the deal Thursday with the Chinese firms Farsighted Investment Group and Gold Water Resources, the official New Light of Myanmar said.  The dam, which is the fifth planned for the 2,800-kilometre (1,750-mile) river, will have a capacity of 2,400 megawatts, the government mouthpiece said. The paper gave no other details of the deal, but said the dam would be on the Upper Salween in Myanmar's northern Shan State. China and Thailand have signed a raft of deals over the last year to tap impoverished Myanmar's energy resources, particularly in natural gas and hydropower. The United States and Europe have economic sanctions against military-run Myanmar to punish them for the ongoing detention of democracy leader Aung San Suu Kyi and other human rights abuses. But the effect of the sanctions has been largely eroded by rapidly increasing trade with energy-hungry neighbours like China, Thailand and India.