The Three Gorges Dam Project

Economic Issues

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The construction of the Three Gorges Dam on the Yangtze River has a number of positive and negative economic impacts for the Three Gorges area and for China. A cost-benefit analysis was done to determine these impacts.

Since the Yangtze River has a tendency to flood frequently, measures have been taken in the past to lessen the impacts on the area. Flooding in the past has cost millions in damages to homes, land, and other property. With the building of the Three Gorges Dam, the flood frequency is increased to one-hundred years, thus lessening the impact floods with have on the economy. The dam will also provide energy for much of China. Hydroelectric power is a self-sustaining, renewable, clean energy resource. According to the Chinese government, the dam will have paid off all its debts by the year 2012, a mere three years after completion is scheduled.

Large cargo ship traveling upstream Yangtze River. Courtesy of Edwin Moise.

The creation of the reservoir has a number of economic values. It will aid in boosting agriculture, since the reservoir will hold more water for irrigation. It also will provide the surrounding areas with a stable source of drinking water. With a final depth of 525 ft, larger ships can be used to transport products up and down the Yangtze River. This increased navigability will increase the economy in the area. Trade is estimated to increase five times in the Central China. Transportation costs are expected to reduce by 35-37%. This enhanced navigability is furthered by the shiplocks at the Three Gorges Dam. They are big enough to allow twelve large commercial ships to travel over the dam at once.

China will lose money due to the inundation of fertile farming land. The 100,000 acres that will be flooded accounts for 10% of the grain supply, 50% of which is rice. To make up for this loss, China will have to import more grain and rice from other countries. Resettlement of the people living in the reservoir area includes the switching of agricultural commodities. The new land is less fertile, and therefore the growing of grain and rice will be harder and more expensive. Instead, value added products, such as citrus fruits, are more viable to grow. However, since these farmers may be unfamiliar with growth citrus fruits or other products, production on these new farms may be slower and yield less economic trade. The people who are not granted land to farm will be trained to work in cities and towns. The majority of the people living in the reservoir area are uneducated, thus making this transition more difficult. who are not granted land to farm will be trained to work in cities and towns. The majority of the people living in the reservoir area are uneducated, thus making this transition more difficult.

Fisherman in front of Three Gorges Dam. Courtesy of European Space Agency.

The Yangtze River contains 300 different fish species. It is argued that the construction of the dam will prevent fish from spawning upstream, thus diminishing population sizes. This would have a negative impact on the local fishing industry and also on the livelihoods of fisherman who depend on it. It has been noted that fish are now moving upstream on tributaries to the Yangtze River to spawn. The government also insists that the creation of the reservoir will make room for more fish and so increase fish population in that way. Only the future will be able to tell how the dam will affect local fisheries.

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