China’s project of the century

China just broke ground on what it’s calling the “project of the century”: a $167B hydropower mega-dam in Tibet (aka China’s ‘Xizang Autonomous Region’).

This big Motuo dam aims to:

• Generate ~300TWh per year (more than the UK’s entire consumption)

• Push China closer to its 2060 net zero goal, and

• Jolt its economy awake with another massive infrastructure project.

And ‘jolt’ it did. In the hours since China’s premier (Li Qiang) confirmed the news…

• Shares in the lead contractor (China Energy Engineering) surged 51% 

• Both Power China and Huaxin Cement were up 10% (Shanghai’s daily limit), and 

• Ore, steel, and rolled coil futures all soared. 

Of course, this project is hardly a surprise for Intriguers: we flagged when the dam got its approvals back in December. But Saturday’s soil-turning ceremony with Premier Li is what caught everyone by surprise here: they’re really doing this.

And beyond the dam’s remarkable scale above, it’s turning heads for two big reasons:

1. Tibetan autonomy

The Dalai Lama doesn’t seek Tibetan independence, but rather what he calls a ‘Middle Way Approach’: genuine cultural, religious, and administrative autonomy within China.

So you can see how Beijing building the world’s largest dam in Tibet might be a tad inflammatory. We don’t have to speculate, either: China’s much smaller plan straddling Sichuan province met rare Tibetan protests in February last year because it involves:

• Submerging a valley home to ancient monasteries, and

• Relocating several villages home to thousands of people.

As for this new Motuo dam? It’s 30 times bigger. It’s even three times bigger than China’s famous 1990s-era Three Gorges Dam! And that one stirred ultra-rare dissent in China’s rubber-stamp legislature as authorities involuntarily resettled 1M+ people.

So while details on this new Motuo dam are still scarce, its sheer scale makes some kind of repeat seem inevitable: it’ll plonk a reservoir on the Yarlung Tsangpo River and bore tunnels through Namcha Barwa mountain, both reportedly sacred for Tibetans.

As for how China’s ruling party might handle any unrest? The past examples above have seen mass detentions and beatings. And the world will already be watching, because…

2. The neighbours are worried

If there’s one thing we remember from geography class, it’s that rivers flow. And yes, the Yarlung Tsangpo flows into both India (where it’s called the Brahmaputra) and Bangladesh (where it’s called the Jamuna), watering perhaps 400 million lives and livelihoods via agriculture, fisheries, sanitation, and transportation.

That kind of leverage means both neighbours have already flagged concerns China could weaponise these water flows. And it’d hardly be a first: right after India suspended its own water treaty with Pakistan during their May spat, China started fast-tracking a dam in Pakistan to help loosen India’s grip.

But for now, Beijing is dismissing any concerns, arguing it doesn’t want to benefit at the “expense of its neighbours” — though various neighbours like Bhutan, Nepal, and the South China Sea claimants (plus China’s own annexed territories) might like a quiet word.