Displacement, Resettlement, Rehabilitation ... - World Bank Group [PDF]

Contributing Paper

Displacement, Resettlement, Rehabilitation, Reparation and Development - China Report

Jun Jing Department of Anthropology, City University of New York, USA

Prepared for Thematic Review I.3: Displacement, Resettlement, rehabilitation, reparation and development

For further information see http://www.dams.org/

This is one of 126 contributing papers to the World Commission on Dams. It reflects solely the views of its authors. The views, conclusions, and recommendations are not intended to represent the views of the Commission. The views of the Commission are laid out in the Commission's final report "Dams and Development: A New Framework for Decision-Making".

World Commission on Dams

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Displacement, Resettlement, Rehabilitation, Reparation and Development

Disclaimer This is a working paper of the World Commission on Dams - the report herein was prepared for the Commission as part of its information gathering activity. The views, conclusions, and recommendations are not intended to represent the views of the Commission. The Commission's views, conclusions, and recommendations will be set forth in the Commission's own report. World Commission on Dams 5th Floor, Hycastle House 58 Loop Street PO Box 16002 Vlaeberg, Cape Town 8018, SOUTH AFRICA Telephone: +27 21 426 4000 Fax: +27 21 426 0036 Email: [email protected] http://www.dams.org

This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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Preface Since the 1950s, the construction of hydraulic and hydroelectric projects in the People’s Republic of China (PRC) has resulted in the relocation of at least 10 million people. The Chinese government identifies these people as “reservoir resettlers” ("shuiku yimin"), a term to be used throughout this perspective paper. Any discussion on China's water projects should take note at the onset that many of the country’s resettlement problems today are associated with the Great Leap Forward (1958-1960) and the Cultural Revolution (1966-1976), when reckless decisions were made that severely affected the resettled people and their communities, not to mention the safety standard of hastily constructed dams and reservoirs. With political agendas put in command and resettlement planning taken lightly, the leadership under Mao Zedong neglected the resettled people’s basic welfare. In fact, the resettlement programs of all major water projects undertaken in China from the late 1950s to the late 1970s failed disastrously. This unfortunate situation began to change in 1981, when corrective regulations were introduced. In the decade that followed, the Chinese government emphasized what it now routinely calls “developmental resettlement policy” ("kaifaxing yimin zhengce"). The thrust of this policy is to aid the development of local economies to provide resettlers with opportunities to improve their livelihood in the post-relocation phase. Put differently, the new policy stresses the overall economic improvement of project-affected areas as the broader base and foundation for resettlers to cope with the social, financial, economic, and ecological effects of river-basin projects. Chinese officials describe the new policy as "blood-creating assistance" ("zaoxue fuzhi"), contrasting it to "blood-giving assistance" ("shuxue fuzhi") in the past that relied merely on monetary compensation and poverty alleviation to solve resettlement problems.1 The central goal of this perspective paper is to review the consequences of the Chinese government’s former and new resettlement policies. The fact that China has built many water projects at different times in the past 50 years sets limitations on this paper’s scope. What will be emphasized in the pages that follow involves three main issues. First, a discussion will be devoted to what the Chinese government calls “leftover problems of reservoir resettlement” ("shuiku yimin yiliu wenti"), that is, the unsolved burden of social, economic, and environmental problems on the resettlers who had been displaced before the developmental resettlement policy was implemented. Second, the question of whether or not China’s new resettlement policy has been effective will be addressed on the basis of information in regard to some of the more recent water projects to which the so-called developmental resettlement policy has been applied. And third, a description of the resettlement programs associated with the Xiaolangdi Project on the Yellow River and the Three Gorges Project on the Yangtze River is offered.

Sources of Data Much of the information in this paper is taken from Chinese government documents, especially a series of reports in Memorandums of Hydraulics, Poverty Relief, and Development of Reservoir Areas (shuili fupin yu kuqu kaifa dongtai). This specialized publication, issued six times a year since February 1997, is founded by the Reservoir Resettlement Office and the Poverty Relief Office at the Ministry of Water Resources in the PRC. Edited at the Center for the Study of Reservoir Resettlement, in Nanjing, most of the reports in this publication are written by provincial, municipal, and county officials in charge of resettlement.

1

Meng Xiujing, “Tentative Ideas on the Methods of Handling the Leftover Problems of Reservoir Resettlement (qiantan chuli yimin wenti de zuofa yu tihui), Memorandums of Hydraulics, Poverty Relief, and Development of Reservoir Areas (shuili fupin yu kuqu kaifa dongtai), Issue No. 3, 1997, pp. 13-18.



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In addition, on-site investigation reports by Chinese researchers will be quoted at length, including studies on a staircase of three dams in Gansu Province, the Xin’anjiang Dam in Zhejiang Province, the Sanmenxia Dam on the Yellow River, and the Three Gorges Project on the Yangtze River. Figures and conclusions in two World Bank reports on three dam projects in China will be quoted as well. Furthermore, summaries and analyses of the information gathered from the above sources will be combined with some of the insights that the author of this perspective paper has gained in the past 10 years through field research on population resettlement associated with five water projects in China: the Liujiaxia, Yanguoxia, and Bapanxia Multipurpose Dams in Gansu Province, the Zhanxi Reservoir in Hunan Province, and the Three Gorges Project.

Background Briefing Before 1949, China had no more than 40 small hydroelectric dams and only a handful of large-scale reservoirs. In the early 1950s, the stage was set for a dramatic development of the country’s hydropower industry. The former Soviet Union played a pivotal role in the early phase of the PRC’s endeavors to build multipurpose dams to control flood, increase irrigation and generate electricity. In planning the construction of 46 dams on the Yellow River in the early 1950s, for example, a delegation of Soviet experts went to China to help conduct the feasibility studies, including surveys of dam sites. Population resettlement received scant attention in these feasibility studies, as their emphasis was on the engineering aspects of the planned projects. In addition to the Soviet-style central planning approach in handling large water projects, the fact that top PRC officials had been deeply involved in warfare for many years helps explain why they treated large river-basin development projects as if they were conducting miliary campaigns. Central directives for population resettlement underscored the importance for local officials to strictly obey orders from the above, stressed the necessity of relinquishing individual, community, and even regional concerns, and highlighted the expectation of long-term gains for the country as a whole vis-avis what was perceived to be only temporary losses in the project-affected areas. The lack of consideration for local concerns and rural resettlers in particular was most typical of large-scale water projects in the Maoist era (1949-1976). Consequently, compensation was decidedly insufficient, a problem coupled by farmland shortages and environmental adversities. At the height of the Great Leap Forward, central authorities made hydraulic and hydroelectric projects into development showcases through a nationwide dam-building campaign. Similar campaigns were to be launched in the years to come. By 1985, the state-organized campaigns for electricity, irrigation, and flood control succeeded in building 70,000 dams and 80,000 reservoirs.2 Of these waterworks, 300 dams and 340 reservoirs are built on a large scale. By 1992, when the Three Gorges Project was approved for construction, China already had 369 large reservoirs.3 These man-made lakes, each exceeding 100 million cubic meters, facilitate the operation of hydroelectric stations installed with turbines of varying power-generating capacities. From an extreme feeble sector of the national economy, the hydropower industry now contributes to 20 percent of China's electricity output.4 The Xiaolangdi and Three Gorges projects, scheduled to be completed in the next decade, have been designed to make the hydropower industry an even more important sector of the Chinese national economy. 2

State Statistic Bureau, China Statistical Yearbook (Zhongguo tongji nianjian), Beijing: State Statistics Press, 1993, p. 351; Vaclav Smil, China's Environmental Crisis: Inquiry into the Limits of National Development, Armonk, NY.: M.E. Sharpe, 1993, pp. 109-10. 3

China Statistical Yearbook (ibid), p. 351.

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Thermal power plants are still the main source of electricity supplies in China, contributing to about 70 percent of the country's total electricity output. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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The Human Costs China's success in building so many dams and reservoirs has been achieved at enormous human costs, which are revealed by the large number of people uprooted from their hometowns. After years of damming the country's large rivers, their tributaries, and smaller rivers, 10.2 million people in China were officially recognized as “reservoir resettlers” by the late 1980s.5 This figure has yet to be officially updated to include new figures of population resettlement. The actual number of China's reservoir resettlers may be substantially higher than 10.2 million. In this regard, it is worth mentioning that the dams and reservoirs already built on the tributaries and the main course of the Yangtze River alone have caused the relocation of at least 10 million people, according to incomplete figures recorded in the project-by-project descriptions in the 1997 edition of a Chinese reference book about the Yangtze River. Not all project descriptions in this book include resettlement figures.6 The characteristic features of reservoir resettlement in China before the 1980s can be summarized in the following ways: First, the absolute majority of the displaced people were farmers from small and remote villages; they were seldom consulted in advance and nearly always inadequately compensated. Second, about half of the resettlers were displaced by large-scale water projects directly financed by the Chinese central government.7 And third, as victims of mandatory relocation, inadequate compensation, and farmland destruction, an overwhelming number of the displaced farmers became considerably poorer than before they were moved and worse off than their neighbors who were not. In fact, China's leading povertyrelief agency acknowledged in a 1989 publication that more than seven million, or roughly 70 percent, of the country's existing 10.2 million reservoir resettlers were living in "extreme poverty" ("jidu pinkun"), suffering from acute shortages of food, clothes, and decent shelter.8 To ease their problems, the then combined Ministry of Water Resources and Electric Power had embarked in 1986 on a 1,900 million yuan rehabilitation program at 46 resettlement areas where 5 million reservoir resettlers could not make ends meet. Although living conditions improved markedly among China’s reservoir resettlers by the early 1990s, thanks to government aid and an overall improvement of the Chinese economy, a 1994 World Bank report cited the Chinese government as saying that 46 percent of the country's reservoir resettlers had yet to be "properly resettled" and that they "were at great risk."9 The fact that years, even decades, later a significant proportion of the country’s reservoir resettlers remained a costly welfare burden to the state raises serious questions about not only the monetary costs of big dams but also the costs in human suffering.

Policy Adjustment

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World Bank, "China: Xiaolangdi Resettlement Project," Report No. 12527-CHA, 1994, p. 3. See also Zhang Yue, "Migration and Development" (Yimin yu fazhan), Forum of Rural Affairs (Nongcun wenti luntan), Rural Development Research Center of State Council, Beijing, July 1, 1988, no. 138, p. 40.

6

Wang Jie (editor), Comprehensive Dictionary of the Yangtze River (Changjiang dacidian), Wuhan: Wuhan Publishing House.

7

Tian Fan and Lin Fatang, Human Migration in China (Zhongguo renkou qianyi), Beijing: Zhishi Press, 1986, p. 185.

8

Leading Group of Economic Development of Poor Areas, Outlines of Economic Development in China's Poor Areas, Beijing: Agriculture Press, 1989, p. 25. Note that this is a Chinese-English text. 9

World Bank, 1994, op.cit., pp. 2-3.



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In retrospect, legal protection for reservoir resettlers was the first step the Chinese government took in the 1980s to deal with an enormous amount of accumulated problems. In 1981, the country’s Reservoir Resettlement Law was promulgated, and it established a “reservoir maintenance fund” to divert money from the hydropower industry for poverty relief among many of the displaced and disenfranchised people in the Chinese countryside. Under this law, hydropower stations were required to allocate 0.001 yuan per kilowatt hour of electricity they generated for funding projects designed to improve the living conditions of reservoir resettlers. A year later, the Law of Land Acquisition in State Capital Construction significantly raised compensation rates for land acquisition, clarified land titling, stipulated protection of incomes and assets, and required consultation with affected communities. These leal stipulations were incorporated into the Land Administration Law in 1986. Around this time, the Ministry of Water Resources and Electric Power took special measures aimed to compensate lost assets at replacement cost, restore pre-relocation incomes, and attend to the special needs of ethnic minority groups. Most of all, the Chinese government promoted its developmental resettlement policy, which became widely known in reservoir areas by the early 1990s. What this policy means in practice is the incorporation of local economic development into resettlement plans. Specifically, the approval of construction funds is made contingent upon plans made by project administrators and local governments to utilize part of the resettlement investment to improve economic conditions in reservoir areas or at resettlement sites elsewhere. The goal of this procedure is to guarantee the creation of a viable economic base to provide resettlers with tangible benefits such as industrial jobs, low-interest bank loans, and training classes for farmers to grow cash crops or acquire other skills to participate in China's emerging market economy.10 In organizational terms, the implementation of the new resettlement policy is handled by different departments at all administrative levels. Offices explicitly set up to take charge of reservoir resettlement now have become a full-fledged bureaucracy, extending from the central government at the top down to provincial, prefectural, municipal, and county governments. Apart from the obvious need for coordination between different government agencies, the resettlement offices at the local levels are responsible for drawing up specific plans, allocating new land, approving compensation rates, and supervising infrastructure construction. Much of the detailed work, however, has to be performed at the three lowest tiers of the administrative system: the county resettlement office, the township government, and the village committee. China’s reservoir resettlement bureaucracy is also responsible for the establishment of training centers for local officials from different areas to take short-term courses on financial management, policy and legal stipulations, information exchange, arbitration skills, and post-relocation monitoring. Compared with economists and engineering scientists who have been actively involved in different aspects of resettlement planning and post-relocation monitoring, Chinese demographer, sociologists, and social anthropologists have yet to gain more opportunities to use their expertise in applied studies of water projects.

10

See e.g., Resettlement Office of the Hydraulics Bureau of Shandong Province, “ On Effective Management and Utilization of Resettlement Funds for the Promotion of Economic Development in Reservoir Regions” (Guanlihao yonghao shuikou yimin zhouzhuan jin), Memorandums of Hydraulics, Poverty Relief, and Development of Reservoir Areas (shuili fupin yu kuqu kaifa dongtai), Issue No. 1, 1998, pp. 37-43.



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Specific Lessons from the Past Studies of population resettlement associated with dams and reservoirs began to emerge in mid-1980s. Tian Fang and Lin Fatang, two veteran central planners and government economists, devoted a chapter to dams and reservoirs in their 1986 book about people's migration within China.11 According to Tian and Lin, 86,000 reservoirs had been built in China by the mid-1980s, and 311 of these reservoirs were large-scale projects. The large reservoirs alone flooded 8.8 million mu of arable land and displaced 5.04 million people.12 In describing what had happened to this particular population, Tian and Lin provided one of the earliest accounts of the so-called “leftover problems of reservoir resettlement.” Later government reports characterized these problems as “seven difficulties" ("qi nan") and "four inadequacies" ("si cha"). The "seven difficulties" include shortages of electricity, drinking water, schools, food, medical services, and means of communications and transportation. The "four inadequacies" refer to the insufficient amount and poor quality of irrigation, housing, flood-control, and reservoir maintenance facilities. To identify the particular causes of these problems, it is necessary to examine three specific cases.

Xin’anjiang Dam and Forced Resettlement The Xin’an River originates in the Yellow Mountains in Xiuning and Qimen Counties in Anhui Province, flows through Tunxi and Weng Counties in Anhui and Chun’an County in Zhejiang Province, joins the Lan River in Jiande County, in Zhejiang, and then flows northeast into the Fuchun River. About 260 kilometers in length, the Xin'an River drains an area of 11,800 square kilometers. The Xin’anjiang Hydropower Station was first planned in 1952 and the dam design was approved in 1956. Construction at the dam site began in 1957, and three years later the station’s first group of turbines started operating. The station generates 1.86 billion kilowatt watts of electricity per year, and the dam’s 580-square-kilometer reservoir stores 17.8 billion cubic meters of water. Two counties with long and rich history, Chun’an and Sui’an, were severely affected by the Xin'anjiang Reservoir. Seven townships, 1,140 villages, and 320,000 mu of arable land were submerged; 280,000 people, mostly farmers, were resettled.

11

Tian Fang and Lin Fatang, op.cit.

12

One mu = 1/6 acre



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According to Mou Mo (a former government official) and Cai Wenmei (a sociologist at Beijing University) who have studied the Xin'anjiang case,13 government officials approached to the project with great care in the experimental phase of resettlement in 1956-57 that involved the relocation of 20,000 people from two villages and two township seats. Official caution at this stage was reflected by the allocation of 508 yuan for each of the resettlers to cover the cost of moving their belongings, by the designation of an adequate amount of farmland in the receiving communities, and by the construction of new houses in accordance to the design, space, and quality of the displaced people's original homes. The launching of the Great Lead Forward in 1958, however, changed the cautious approach. As the dam construction was speeded up, a government directive ordered the local farmers to “take more good ideology with them and less old furniture” so that resettlement could be carried out “like a battle action.” In Chun’an County alone, more than 137,000 farmers were relocated in 1958 without even being told in advance of the whereabouts of their resettlement sites. The following passage from the published study by Mo Mou and Cai Wenmei describes how the villagers in Chun'an were forced to leave their homes: "At this point, the farmers had no time to help clear the reservoir site of loose debris in preparation for flooding. Authorities in Hangzhou (i.e., provincial capital of Zhejiang) had to send in squads of outside workers to clean up the reservoir's bottom land. But what they mainly did was to dismantle and pull down residential buildings as a way of driving people out of their homes as quickly as possible. By regulations for reservoir construction, population resettlement should take place before the impounding of the planned reservoirs. But during the Great Leap Forward in some areas of Xin’anjiang, this procedure was reversed and inundation was used as an excuse to chase people away by force. Not all resettlers could silently endure the shock. Bewildered and depressed, some villagers put up feeble resistance. Others, however, protested angrily and refused to move. Some went mad or became so disturbed psychologically that they set their own houses on fire." For the 137,000 displaced farmers of Chun’an County, according to Mou and Cai, their long journey on foot to the resettlement sites was a nightmare. Freezing and starving, they ate unheated food to fend off the hunger, and at night they slept tightly next to one another to stay warm in open air. Some villagers became sick and even died. Pregnant women had to give birth on the roadside. As a local official recalled years later, this journey was like an exodus of wartime refugees. A villager even likened the journey to running away from Japanese soldiers in the Second World War. On arrival at the resettlement sites, the tired resettlers found that they had been assigned to live in swamps or wastelands which officials expected them to reclaim and make habitable. The lands proved extremely hard to cultivate, and many evicted families eventually had to find new places to live. Moreover, the compensation for the resettlers was reduced from 508 yuan to 150 yuan per head. In Chun’an, the per capital compensation was brought down to 120 yuan, not enough to cover even the cost of a decent coffin. Forced resettlement in the Xin'anjiang case and elsewhere in China have had serious political repercussions. At the beginning of the Cultural Revolution, for example, the Xin'anjiang resettlers gained their first opportunity to act collectively to denounce the way they had been displaced. How they did so calls for a brief background explanation: During the "high tides" of the Cultural Revolution between 1966 and 1968, almost every urban school and work unit in China erupted in dissension and factionalism, very 13

Mou Mo and Cai Wenmei, "A Review of the History of Population Resettlement on Xin'anjiang," in Dai Qing and Xue Weijia edited, Whose Yangtze Is It Anyway? (Shui de changjiang?), Hong Kong: Oxford University Press, 1996, pp. 167-85.



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often spiraling into violence. Amidst exaggerated charges, a great many basic-level leaders were topped from below and humiliated -- or worse. In every city, so-called Rebel and Conservative factions emerged from the melee and fought each other in the streets. In the villages, by contrast, there were far more divergent scenarios. A great many villages did not directly experience any turmoil at all, whereas the ferocity of the violence in certain rural districts surpassed even the urban upheavals. Li Rui, a vice minister in the Ministry of Water Resources and Electric Power in the 1950s, reports that in the Cultural Revolution some angry farmers in reservoir areas seized the chaotic situation to murder local officials who were in charge of resettlement. In the Xin'anjiang case, according to Mou and Cai, more than 10,000 displaced farmers marched to the county seat of Chun’an at the start of the Cultural Revolution where they attacked and badly injured one leading resettlement official. They forced another official to denounce himself at public rallies for the failure of resettlement. The second official felt so humiliated that he went mad. In a nearby county, angry resettlers dragged the county magistrate to the reservoir trying to kill him by drowning. He was rescued by army officers. Other effects of forcibly achieved resettlement in the Xin’anjiang case may be grasped by looking at a few economic figures: Chun’an County, for example, went from producing a grain surplus to importing over two million tons of grain within just one year after the dam was built. Contrast this situation to 1957, when Chun’an’s 74,000 registered rural households sold the state, after keeping enough to eat by themselves, a total of 13.61 million kilograms of grain. In the Xin’anjiang case, absolute poverty affected the resettlers not for years but decades. In 1983, 65,000 locally resettled rural residents lived off 0.34 mu of arable land per head. For most, this was much less than they had before they were resettled. Also in 1983, the average rural income in Chun’an was 205 yuan, but 61.4 percent of the people resettled locally earned less than 200 yuan per capita, and 28.2 percent of these resettlers earned less than 150 yuan. The under-150-yuan income level was what the government identified, a few years later, as “absolute poverty.” The long-term impact of deprivation was hard to erase, even though the Xin'anjiang Reservoir became a hot tourist site by the late 1980s. By then, the reservoir had acquired a different name: the Thousand Island Lake (Qiandaohu). The so-called islands are the tops of small hills inside the reservoir. Mou and Cai's description of how resettlers came back to live on some of these islands is a sober reminder of these people's vulnerability: "For Western tourists visiting the Thousand Island Lake, they see it as beautiful as the Geneva Lake. But they have no idea of how it was created, and they know nothing about the suffering among the people who settled down on the islands. We once interviewed a 42-year-old farmer named Wu Haiquan and his family.... They had resettled four times because of the dam. After their initial resettlement, they moved back to their old hometown in 1962. Later they moved to Jiangxi and then to Anhui, eventually coming back to settle down on one of the islands in the reservoir. For 25 years, 17 families had lived on this particular island with only 14 mu of cultivated land.... There were only seven or eight houses, one made out of tile and the rest of mud and grass. Neither electricity nor gas was available on the island. In 1980, when these families finally obtained their local residence cards, the local government gave each households 1.5 kilograms of kerosene a year for lighting. When the kerosene ran out, they had to use candles, and those who could not afford candles had to burn pine twigs.... Wu Haiquan used to have four children, but two of them were drowned after falling off the steep cliffs along the island’s shore. The island did not have proper docks. Wu Haiquan became so worried about his other children’s safety that he would rarely permit them to leave the island and, as a result, they were unable to attend school. One of his children, a beautiful girl and already 18-years-old, was illiterate. Although the Thousand Island Lake have developed into a tourist spot, this young woman and other youngsters living in isolation like her find it difficult to interact with the outside world." This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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Mou and Cai argue that if a scientist's proposal had been adopted for the resettlement program of the Xin’anjiang project, maybe the result would not have been too disastrous as it turned to be. The scientist was Xu Zhishi, chief engineer of the Xin’anjiang project. In 1952, he proposed building a group of smaller dams along the river to avoid the inundation of too much farmland. The Ministry of Industrial Fuel in Beijing preferred, instead, the construction of one single big dam. Xu Zhishi was then ordered to work with teachers and upper-class students of the Zhejiang Finance and Economics College to conduct surveys of arable land, housing property, crop yields, population figures, and transportation facilities in the planned reservoir area. When the surveys were completed in about two years, Xu Zhishi concluded that 300,000 mu of arable land would be flooded, necessitating the relocation of 200,000 people. He also realized that there was simply not enough vacant land in Zhejiang Province to resettle these people and that some of them would have to relocate to neighboring provinces. Thus, he traveled with his assistants to the nearby provinces of Jiangxi, Anhui, and Jiangsu to find land. In southeast Anhui, they found large plots of farmland that were left deserted after the Taiping Rebellion in the mid-19th century depopulated this region. In Jiangxi Province, Xu Zhishi and his assistants also found extra land. The provincial governments of Anhui and Jiangxi each agreed to receive 50,000 Zhejiang farmers and build houses for them. With this assurance, Xu Zhishi proposed resettling half of the targeted population in Zhejiang and the other half in Anhui and Jiangxi. His proposal was vetoed, ironically, by the provincial government of Zhejiang, for reasons that are not explained by Mou and Cai but might have to do the provincial government’s eagerness to impress upon central authorities that Zhejiang could handle the entire population of displaced farmers without relying on help by neighboring provinces. As resettlement in China was and remains to be, ultimately, the responsibility of local governments, central authorities overruled Xu Zhishi’s proposal and approved the Zhejiang government’s resettlement decision. When Xu Zhishi tried to insist on the soundness of his resettlement proposal, he was criticized by Zhejiang officials and forced to endorse the official resettlement plan. Resettling the targeted farmers within Zhejiang quickly turned out be a total failure, typified by an acute shortage of farmland which in turn led to a food crisis -- precisely as Xu Zhishi had predicted it. But it was not until a decade later that the Zhejiang government reconsidered its earlier decision and began sending resettlers to neighboring provinces. By the early 1970s, 19,000 Zhejiang farmers had gone to Jiangxi voluntarily, and 86,000 farmers had moved out of Zhejiang by government degree, according to Mou and Cai. The number of people who moved out of Zhejiang in the end reached 40 percent of the affected population, lending vindication to Xu Zhishi's suggestion for building small dams and his resettlement proposal. The Liu-Yan-Ba Dams and Environmental Degradation As a shorthand, Liu-Yan-Ba refers to Liujiaxia, Yanguoxia, and Bapanxia. These are three narrow gorges on a section of the Yellow River that zigzags through Yongjing County, Gansu Province. From 1961 to 1975, the mouths of these gorges were dammed to build a staircase of three hydropower stations that have since greatly aided the development of northwest China -- though not necessarily the rural county of Yongjing where two of the three dams and all the reservoirs of the Liu-Yan-Ba projects are located. In the Liu-Yan-Ba case of resettlement, the Yanguoxia Hydropower Station (built from 1958 to 1961) and the Liujiaxia Hydropower Station (built from 1958 to 1969) displaced 41,588 people in a total of 7,589 households. The compensation these resettlers were supposed to receive was 250 yuan and 364 yuan respectively, but they got about 20 percent less than promised because some of the money had to be used for building roads and saving an important archaeological site. In the construction of the Bapanxia Hydropower Station, built from 1968 to 1975 when China was in a relatively better economic shape, the 2,241 resettlers in 379 households were given 1,100 yuan per head, enough to build new houses with



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salvaged materials but still far too little to cover the destruction of farmland.14 Local government documents show that the resettlers in the Liu-Yan-Ba case were moved from fertile to poorer lands when they were relocated from the river’s bottom land to windswept uphill lands.15 Before the move, they farmed 2.6 mu of arable land per head. Because 18,229 mu was flooded, a 1988 survey found that the resettled villagers had only 1.47 mu of farmland per head, and most of this was in areas with severe soil erosion.16 The drastic reduction of farmland, among other things, contributed to "extreme poverty" ("jidu pinkun"). In 1987, the per capita annual income in the resettled communities along the river was on average 33 percent less than the pre-relocation level while the per capita annual grain supply declined by an average of 30 percent.17 Before relocation, the average villager had an income of 356 yuan per year and a grain supply of 214.5 kilograms. By 1987, the per capita income had declined to 239 yuan while the grain supply had dropped to 154 kilograms per head. The 1987 level of per capita income in the Liu-Yan-Ba area was 20 percent below the average for Gansu's rural population.18 In the same year, 9,768 resettled households had a per capita income of less than 150 yuan, putting them below China's official poverty line, set between 150 to 300 yuan depending on regional differences of price for food and clothing.19 The widespread poverty in the Liu-Yan-Ba case was closely related to the rapid deterioration of the local ecosystems. Intensive farming on hilly flanks along the river, where the soil consisted of a fragile loess silt, contributed to erosion and eventually led to the abandonment of 15,944 mu of land that the resettlers had painstakingly reclaimed. In communities along the reservoirs, the problem of silting in the reservoir raised the water table in the fields nearby and thus rendered 15,621 mu of farmland unfit for growing crops.20 These figures represent a 9.5 percent loss in the cultivated fields that either had been retained or were acquired through land reclamation. Of all the farmland (300,900 mu) being cultivated in 1988, 3,500 mu was damaged by salinization and 40,000 mu by landslides; these badly spoiled fields constituted 15 percent of the farmland still available to the local villagers who retreated to uplands to live.21 14

The flooded farmland was compensated at a rate set by the central government in 1958. This fixed the purchasing price as equal to the estimated grain yield for each mu of land over three years. The government compensation for land destruction was inadequate, too meager to reestablish agriculture in the new and usually less fertile fields allocated to the resettlers. A more generous standard for compensation, doubling the 1958 rate, was adopted until l982. 15

Linxia Prefectural Government, "A Request for Sharing Profits with the Three State-Built Hydrostations in Our Prefecture" (Guanyu guojia jianzai wozhou jingnei sanzuo shidianzhan gei difang rangli de qingqiu), 1987, p. 4. 16

Gansu Hydraulic Society, "An Assessment of the Planned Solutions to the Existing Problems of Resettlement at the Liujiaxia, Yanguoxia, and Bapanxia Reservoir Sites" (Guanyu Gansu sheng Liujiaxia Yanguoxia Bapanxia kuqu yiliu wenti chuli guihua de pinjie yijian), 1988, pp. 3-19. 17

Gansu Provincial Government, "An Outline for Planning Solutions to the Remaining Problems of Population Resettlement in Gansu Province's Liujiaxia, Yanguoxia, and Bapanxia Reservoir Areas" (Gansu sheng Liujiaxia Yanguoxia Bapanxia kuqu yimin yiliu wenti chuli guihua gangyao), 1988, p. 3. 18

Gansu Hydraulic Society, op.cit., p. 5.

19

Gansu Provincial Government, op.cit., p. 3.

20

Ibid, p. 18; Gansu Provincial Economic Planning Commission, "An Investigation Report of the Existing Problems in the Reservoir Resettlement Areas of Yongjing County" (Guanyu Yongjing xian kuqu yimin dangqian cunzai wenti de diaocha baogao), August 31, 1987. 21

Gansu Provincial Economic Planning Commission, "The Planning of Solutions to the Remaining Problems of Population Resettlement in Gansu Province's Liujiaxia, Yanguoxia, and Bapanxia Reservoir Sites" (Gansu sheng Liujiaxia Yanguoxia Bapanxia kuqu yimin yiliu wenti chuli guihua), April 5, 1988. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


12


Worsening this ecological disaster was what village cadres and local officials call "repeated resettlement" ("fu qian"). It simply means moving for a second or third time in order to find a new place to live when the original resettlement site became unlivable.22 The primary cause of this problem was the rise of the water table that caused erosion to the foundation of residential houses and thereby rendered them unsafe.23 By 1988, 4,725 households, comprising 27,433 people, had resettled for a second time, mostly for fear of endangered houses. Meanwhile, 1,273 households, or 7,254 people, needed be resettled again but local officials could not find suitable places or enough money for them to do so.24 In Dachuan Village of Liujiaxia Township, located next to the Yanguoxia Reservoir, 560 households had relocated once, 322 households twice, and 120 households three times during the period between 1961 and 1987.25 Even with some government aid, "repeated resettlement" was costly and often depleted a household's savings over two to three years.26 Most disbursing in the Liu-Yan-Ba case was the lack of drinking water. More specifically, 60,717 resettlers had no easy access to drinking water in 1987.27 In Yanguoxia Township alone, the shortages of drinking water affected 20 villages, 4,413 households, and 24,825 people every year for up to three or four months.28 In this period, caused by an inability to protect pumps and pipelines from freezing in the cold months, the villagers of Yanguoxia had to travel about 10 kilometers to fetch drinking water from the Yellow River.29 By the early 1990s, the problem of drinking water shortages was greatly eased, thanks to the central government's recognition of Yongjing as a "poverty-stricken county" (pin kun xian), a special status of official recognition that called for the transfer of poverty-relief aid, low-interest loans, and free supplies of water-drawing equipment to help the local farmers climb out of a dire situation of survival. But the problem of water shortages in the Liu-Yan-Ba case was not completely solved. In the summer of 1995, when a delegation of officials from Beijing toured the Liujiaxia Reservoir on a pleasure trip, a large white banner was raised on top of the Liujianxia Dam. The banner bore two rows of big Chinese characters written in black ink: "The people of Yongjing built reservoirs; the people of Yongjing have no water to drink."30 The banner was secretly put up by the people of a resettled village who still had to come down

22

Linxia Prefectural Government, 1987, op.cit., p. 3-6.

23

Gansu Provincial Economic Planning Commission, 1988, op.cit., p. 4.

24


25

Linxia Prefectural Government, "The Planning of Solutions to the Remaining Problems of Resettling the Populations Displaced by the Liu-Yan-Ba Reservoirs" (Guanyu Liu-Yan-Ba shuiku yimin anzhi yiliu wenti chulu guihua), 1987, pp. 3-5. 26

Communist Party Committee of Yongjing County, "Resettlement Problems Are Factors of Instability" (Yimin wenti shan qianzai zhe bu anding yinsu), Document No. 269, July 29, 1987, p. 6. 27


28

Communist Party Committee of Yongjing County, "A Report on Resettlement Affairs and Problems in Yongjing County" (Guanyu Yongjing xian yimin qianyi anzhi qingkuang ji cunzai wenti de baogao), December 12, 1987, p. 6. 29

Yongjing County Gazetteer, vol. 10, p. 51.

30

The exact Chinese words on this banner, Yongjing renmin xiu shuiku, Yongjing renmin mei shui he, were recounted to me by a local government official in Yongjing a year later. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


13


to the reservoir from a mountaintop to get drinking water.31 The Sanmenxia Dam and Backtracking Resettlers In the above two cases of resettlement, the numbers of people who were actually resettled all exceeded the numbers mentioned in original plans. In the Xin'anjiang case, 200,000 were predicted; the actual number was 280,000. In the Liu-Yan-Ba case, the figure was 42,000 but it increased by 1,300 later. As for the Sanmenxia Dam, built at the middle reaches of the Yellow River, the proposed figure was 320,000, and yet far more - 410,000 people - were uprooted. No evidence has been found to suggest that the lower population figures were falsified officials at the planning stage. The problem of population underestimation was primarily caused by overrating the ability of local governments to mobilize people in dealing with a drastically changed ecology. In the Sanmenxia case, nature's reaction to the project came in the form of rapid silting. The planners had been aware of this problem but they thought that it could be controlled by building silt-checking and siltprecipitating dams along the higher stream of the river. With these devices planned along with 12 reservoirs on the tributaries and many more extensive public works for forestation, grassing, and terracing, the project's leaders and technical experts confidently concluded that any difficulties that might arise in power generation, irrigation, and navigation as a result of the silting up of the reservoir would be easy to deal with.32 While the mobilized efforts to plant tree and create terraces were put on hold due to the widespread famine caused by of the Great Leap Forward, silt accumulated in the reservoir at a speed much faster than anticipated. By 1973, silt filled up nearly 70 percent of the reservoir's total storage. Long before the silting problem rendered the reservoir of little use, large quantities of silt had been deposited in the man-made lake as soon as the hydropower station began operation in 1962.33 Silting directly affected the local people when it pushed up the water table in the farm fields and residential quarters along the reservoir, leading to landslides, soil erosion, and collapses of residential houses. These problems triggered the relocation of an additional 90,000 people in the Sanmenxia case. Thanks to a passionate report published in 1996 by Leng Meng in the popular Chinese Writers magazine,34 what the Sanmenxia Dam has become best known for among many Chinese nowadays is the struggle of the displaced people to return to their hometowns after the project was completed. About 300,000 of the 31

In addition to the cited government documents, my description of the Liu-Yan-Ba case is based on my own fieldwork in this area and the following sociological on-site investigations: Wang, Weimin, "Research in Reservoir Resettlement at the Upper Reaches of the Yellow River" (Huanghe shanyu shuiku yimin yanjiu); Yu Changjiang and Feng Xiaotong, "An Investigation Report on the Fifth and Tenth Production Teams of Xiayuancun in the Sanyuan Township of Yongjing County"(Yongjingxian Sanyuanxiang Xiayuancun wushe shishe shequ taocha baogao). These two papers were presented at the "Second Conference on the Development of the Remote and Minority Nationality Regions," Xi’an (April 4-7, 1989); they are available at the Institute of Sociological and Anthropological Research at Beijing University. See also Jun Jing, "A Sociological Perspective on Reservoir Resettlement." Rural Economy and Society (Nongcun Jinji Yu Shehui), Chinese Academy of Social Sciences, vol. 5, no. 11, 1998, pp. 41-47; Chen Shengli, An Investigation Report on a Community of Reservoir Resettlers in Wei Village, Gansu Province (Gansu weicun yimin shequ diaoca baogao), a manuscript written in 1988 and kept at the Department of Sociology, Beijing University; Wang Bo and Ye Ling, “An Investigation Report on a Community of Reservoir Resettlers in Xinyuan Village, Gansu Province (Gansu xinyuancun yimin shequ diaoca), a manuscript also written in 1988 and kept at the Sociology Department of Beijing University. 32

Vaclav Smil, The Bad Earth: Environmental Degradation in China, Armonk, New York: M. E. Sharpe, 1984, p. 45. 33

Smil (ibid).

34

Leng Meng, "The Massive Population Resettlement on the Yellow River," (Huanghe dayimin), Chinese Writers (Zhongguo zuojia), 1996, pp. 60-92. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


14


project's 410,000 resettlers were moved from a fertile Yellow River basin in Shaanxi Province to the northern bank of the Wei River, still within the province but in its arid western reaches. Nearly 40,000 people were sent to further west, to the even more arid Ningxia Hui Autonomous Region where some of the resettlers found themselves in conflict with the local Hui people (i.e., Chinese-speaking Muslims). Soon after they were resettled in Ningxia, many of these resettlers returned to Shaanxi. In the early 1960s, more people returned from Ningxia, to live at the Wei River settlements. By 1985, about 100,000 of the Shaanxi farmers, who either had resettled to Ningxia or the Wei River's north bank, forced their way back to the Sanmenxia reservoir area to live. In their return-to-homeland journey, these farmers had to overcome various obstacles, including police blockades set up expressly to impede what became known officially as "reverse flow of reservoir resettlers" ("shuiku yimin dao liu"). The cause of this persistent "reverse flow" is explained in a 1984 central government report quoted by Leng Meng: "For more than 20 years at the resettlement sites, the per capita daily wages in many production teams ranged from only a few fen to several dozen fen....35 Many resettlers have been living in shabby shelter, and are short of clothes and sleeping quilts...In Liujiawa Township, Dengcheng County, several families have had to live under the same roof with their livestock. In Longtou Village, Shanhua Township, a household of seven people headed by An Shitou has in winter only one pair of padded-cotton trousers, and even that pair of trousers came from government aid. It is not uncommon to find resettled families with four or five people who have only one or two badly tattered sleeping quilts.... The resettlers' wish to return to the reservoir area is first and foremost caused by the inferior living and working conditions at the resettlement sites. The reality of postrelocation life is completely at odds with the government's original promise that the resettlers' annual per capita income would be no lower than before relocation."36 It should be quickly explained here that a significant number of the resettlers could return to their homeland primarily because the originally planned water level of the Sanmenxia Reservoir had to be lowered to avoid flooding Xian, northwest China's largest city.37 This means that a long stretch of farmland was not submerged after all. But instead of being handed back to the returned farmers, these fields were occupied by military and state farms. It was only after many years of hard struggle, involving fights with fist and shovel, letter-writing campaigns, and street demonstrations, that 150,000 Shaanxi farmers were allowed by the central government to retrieve 300,000 mu of land from the military and state farms, according to a 1993 World Bank report. But the actual amount of land turned over to the returnees was 230,000 mu, not the promised 300,00 mu. Moreover, half of the returned land belonged to low-lying sites which were threatened by floods or located along the edge of reservoir which suffer from cliff slides and soil erosion. The latest word on the Sanmenxia case is found in two official report. One says that in 1996 the total number of resettlers in Shaanxi alone reached 460,000 (because of population growth) but only 56,000 of these people had a per capita income level higher than farmers in the same area who were never resettled.38 The other report, issued in 1999, says that many of the 2,096 pumps in the Sanmenxia 35

One hundred fen is one yuan.

36

Quoted in Leng Meng, op.cit., pp. 83-4.

37

For a summary of the miscalculations in the building the Sanmenxia project, see Vaclav Smil, 1984, op.cit.,

pp. 45-7. 38

Hou Bulun, “A Few Experiences in the Management of Projects for Solving the Leftover Problems in the Sanmenxia Reservoir Area of Shaanxi Province” (Shaanxi sanmenxia kuqu yimin yiliu wenti chuli xiangmu guanli This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


15


Reservoir area have become so obsolete that they are breaking down the local irrigation systems. In Weilin Township, Dali County, for example, 100 out of 685 pumps for drawing water from wells have become so out of repair that they are useless.39 A New Age of Planned Resettlement? In 1992, China's State Planning Commission issued a stern circular on resettlement problems associated with both old and new water projects.40 This circular, frankly acknowledging the government's difficulty in dealing with reservoir resettlement, is worth quoting in part: "At the present, various problems of reservoir resettlement are becoming a principal impediment to the construction of hydraulic and hydroelectric projects. If not handled properly, these problems will affect agricultural development and social stability. After the Third Plenum of the 11th Congress of the Chinese Communist Party, the Central Committee of the Chinese Communist Party and the State Council became keenly concerned about and paid special attention to reservoir resettlement problems. We have since adopted a series of effective policies to improve the situation. Better results have been achieved subsequently. Through earmarked funds, we have eased many leftover problems affecting 10 million people. Considering population growth among these people, the number of reservoir resettlers today has reached the 1.5 million mark. Most reservoir resettlers have been able to enjoy improved living standards and better conditions for production, reaching the basic point of proper resettlement. Consequently, the number of organized visits to government agencies to seek solutions to the old problems of reservoir resettlement has dropped and social order in reservoir areas has become stable." After the resettlement situation associated with older dams and reservoirs was summarized, it was stated

de jidi tihui), Memorandums of Hydraulics, Poverty Relief, and Development of Reservoir Areas (shuili fupin yu kuqu kaifa dongtai), Issue No. 5, 1997, pp. 28-30. 39

Gu Maohua, “Ideas on and Investigations into the Maintenance of Small-Scale Irrigation Facilities in the Sanmenxia Reservoir Area” (Sanmenxia kuqu xiaoxing shuili sheshi guanli wenti de daocha yu xikao),Memorandums of Hydraulics, Poverty Relief, and Development of Reservoir Areas (shuili fupin yu kuqu kaifa dongtai), Issue No. 1, 1999, pp. 1-6. 40

“Various Suggestions by the State Planning Commission for the Reinforcement of Supervision over Reservoir Resettlement (Guojia jiwei kuanyu jiaqiang shuiku yimin gongzuo de ruogan yijian), January 17, 1992. In Almanac of China Water Resources (Zhongguo shuili nianjian), Beijing: Hydraulics and Hydroelectricity Press, 1993, pp. 9-11.



16


in this circular that: "But judging by the information coming from different regions, successful resettlement for new projects has been achieved unevenly and many regions have encountered serious problems. From an objective point of view, the imbalanced ratio between many people and little land is making resettlement harder to achieve than in the past. But subjectively, many comrades, especially some leaders, are not keenly aware of the importance of the resettlement task, and they have thus weakened the government's role of supervision in matters of reservoir resettlement. At the stage of preparation, project construction and people's departure have been treated as if they are more important than appropriate resettlement. There are also organizational problems, including the lack of coordination between different agencies, the incompatibility of institutional functions and the problem of mismanaging, misusing, and wasting investment funds. These problems have hampered a number of projects and resettlement programs." This circular, submitted to the State Council and sent around the country in June 1992, should serve as a sober reminder of the tremendous burden that the Chinese government is faced with in handling both old and new problems under the policy of developmental resettlement. In the course of the six years that have passed since the circular was issued, what improvement over the problems identified by the State Planning Commission has been achieved? To address this question, again it is necessary to examine a few specific cases. China as a Model of the World? Since the aforementioned circular was released, several World Bank reports have cited China's policy of developmental resettlement as a model for other governments worldwide. These reports covered Xiaolangdi, Shuikou, and Yantan dams. Compared with the Shuikou and Yantan dams, the Xiaolangdi Project on the Yellow River has a far greater number of people to resettle. Three World Bank reports in particular have regarded Xiaolangdi Project's planned resettlement operation as a success.41 The following is my summary of these reports: Planners of reservoir resettlement in China, according the aforementioned World Bank reports, have used the lessons they learned from the past render Xiaolangdi into the first water project in China to undergo extensive resettlement planning. Resettlement for this project is set to be completed through four stages from 1992 to 2012. The object of the Xiaolangdi resettlement operation, the largest of its kind assisted by the World Bank, is to protect the livelihood of more than 180,000 resettlers. Its explicit goal is to restore and improve the resettlers’ income and living standards through the construction of housing and other basic facilities for people from 10 towns and 276 villages. In addition, the goal to restore and improve the resettled people's income is planned to depend on the development of 11,110 hectares of new land, the relocation of 252 small industries and mines, and the establishment of 84 new industries with 20,500 jobs. To guarantee these results, the Xiaolangdi Project has the highest resettlement budget per person of any project in China. Moreover, a separate Bank credit was created, distinct from the dam 41

“Recent Experience with Involuntary Resettlement: Overview.” World Bank, 1998, Report No. 17538; “Recent Experience with Involuntary Resettlement: China – Shuikou (and Yantan).” World Bank, 1998, Report No. 17539; “China: Xiaolangdi Project.” World Bank, 1994, Report No. 12527-Cha.



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project and loan, to ensure a high level of attention, staff inputs, and budgetary resources.

The majority of the arable land within the Xiaolangdi reservoir counties is already in use by the primary populations. Most of the households that will be resettled in these selected areas will therefore have to share the existing land resources with those already present. Under the resettlement plan, intense irrigation will allow crop yields to increase by 130 to 150 percent. A technical training program is developed for the resettlers to acquire new skills needed for aquiculture, sideline industry, dryland and irrigated farming. A cash crop industry is planned to replace the traditional subsistence farming. But because of limited farming resources, resettlement offices have drawn up plans to shift 36 percent of the agricultural populace to the industrial sector. The resettlement offices have attempted to make the transition as easy as possible. Although the shift in occupation will require significantly different skills, the majority of the affected farmers already have had the experience of participating in a wide range of non-farm activities. These farmers often fluctuate between their normal land-based occupations and temporary factory work or village enterprises. Therefore, the transition from agriculture to factory work will not be so drastic. To create employment opportunities for land-based resettlers who will move into the industrial sector, the government established incentives for local businesses to hire some of the resettlers. Such businesses will enjoy three to five years of "tax vacations," followed by three years of a 50-percent reduction of normal company taxes. Along with tax breaks, industrial enterprises are to receive loans with interests as low as 5 percent a year. Mining, the production of construction materials, and electronic plants will make up the majority of the enterprises that will provide 11,130 jobs, and 8,900 of these jobs are reserved for resettlers. The project administrators, according to the World Bank reports, have made the alleviation of any anxieties as a central goal of successful resettlement. Thus, information on compensation, new sites, prospective housing conditions, and employment opportunities have been planned to be distributed six months prior to the relocation of households. Basic infrastructures will consist of communications and power lines, broadcasting facilities, water supply works, and sewage systems. Wharves and ferries will be constructed around the reservoir. The total area of land to be used for erecting new housing for the displaced will be 3.9 million square meters. Single-storey structures will be made of bricks or timber. Though most new towns will have preconstructed housing, to minimize the stress of relocation, individual households would have the opportunity to construct their own homes with materials provided at wholesale prices. The new towns will be centered around an administrative facility, a hospital, and various shops. A primary school will be built in a locality easily accessible to the resettled villagers. Resettlers are not the only ones that would benefit from the resettlement program. The original inhabitants of the resettlement areas will benefit from training programs and improved social services. Counseling, comparable to that provided to the resettlers, will be available in host communities to ensure their acceptance of resettlers and the latter's smooth adjustment to the resettlement sites. To ensure that compensation is fairly distributed amongst resettlers, local resettlement offices have maintained detailed reports of assets and population figures. Everything, from the number of saplings to each square meter of every room, is being recorded in standardized booklets. These documents bear the signatures of household heads, local administrators, and resettlement officials. As an essential step toward resettlement planning, implementation, and monitoring, government offices for receiving complaints This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


18


will be organized at all levels to handle compensation disputes and other resettlementrelated grievances. National and international review boards will be responsible for conducting various surveys to monitor the resettlement operation. Village-level or township administrators will be required to fill out monitoring forms. These forms will be constructed into quarterly reviews, by county and provincial governments, and eventually consolidated into progress reports by Yellow River Conservancy Commission Resettlement Office. The value of the materials to suffer damage was established at the time of project design. All prices are based on those of June 1993. Local contractors, material input costs, and equipment would be subject to an 8 percent contingency plan. Price increases of 0.5 to 2.4 percent are anticipated for the period ranging from 1993 to 2011. The total cost of the resettlement program is $571.3 million. Infrastructure costs will add up to $235.7 million, with another $216.5 million to be used for livelihood development. Public health, sanitation, and relocation of cultural relics are additional concerns that have been brought up by the governing parties. Little impact on the natural environment is anticipated as a result of the planned agricultural improvement projects. The forested areas will not be infringed upon, and in fact barren lands will revert to forests. Since the Xiaolangdi resettlement operation has been furnished with the highest resettlement budget per person of any project in China, the World Bank believes that positive social adjustment on the part of the resettlers and the communities receiving them is to be achieved. In this connection, it is stated in the World Bank reports that the resettlement operation has already proved to be a success in the relocation of the first 2,000 people from their homes for dam construction. These people enjoyed, within the first of their relocation from the dam site, a 10 to 60 percent increase in per capita income. The transfer of some of these farmers into industrial lines of work also has proved to be a success, with 776 resettlers hired to work in factories. The achievement as described in my summary of the aforementioned World Bank reports is impressive but one must keep in mind that the Xiaolandi Project has been financed in part by the World Bank, and the Bank has specific criteria for resettlement, which means that this project has been handled by Chinese officials with extra care, as compared to domestically financed projects. Furthermore, the initial number of people who were resettled in the Xiaolangdi Project was relatively small when investigation for writing the Bank's staff appraisal report was completed. These people were relocated from the dam site, not from the reservoir site which stretches over a long distance and over many areas with possibly quite different economic and environmental conditions. The people at the dam site may have benefitted from the fact the project's central offices are located nearby and that the relocation of local residents from the dam site would be viewed by future resettlers at the reservoir site as an example of how they would be treated. Official attention to this public perception - crucial in convincing the much larger number of people to be resettled later that they will not suffer too much or that they would even benefit a great deal from the move - has to be considered as an important factor in the reported success of resettlement in the Xiaolangdi case. Why should relocation from the dam site should be distinguished from that from the reservoir area in general? The answer is that resettlers from dam sites in China (and perhaps elsewhere in the world) usually have more opportunities than resettlers from reservoir sites to be employed in project-related lines of work. Construction of transportation routes, installation of communications facilities, provision of services to incoming workers, and the sheer concentration of money and materials pouring into the localities where large dams are being built all help create non-agricultural jobs. If not necessarily permanent, these jobs can last for a long time, depending on the construction cycle. The vast majority of resettlers, however, have fewer of such employment opportunities. Many people living at the middle and upper sections of a large reservoir are even less likely to get into project-related lines of work. Given these circumstances, one has to be cautious in assessing reports about how the first group of resettlers from a given dam project quickly This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


19


had their pre-relocation income level restored within a year and even increased their income significantly. China’s policy of developmental resettlement is designed for all resettlers but in practical terms it varies in its effects, in part because the investment and economic opportunities are concentrated at the dam sites, not at the reservoir sites where the absolute majority of the people slated for resettlement live and work. Xiaolangdi and the Experience of Kuangkou Villagers In the Xiaolangdi case specifically, there is actually an important lesson to be learned, that is, even a sound approach to resettlement at the planning stage may encounter unexpected problems and sometimes failure. In building the Xiaolandi cofferdam, for example, 40,952 individuals in 12,259 rural households were relocated from 37 villages by July 1997. The farmers and their families in one of these villages, named Kuangkou, were allowed to become urbanites in the nearby city of Yima. Out of the 5,570 Kuangkou villagers, 1,444 were supposed to find urban jobs with the Yima city government's help, and 970 were to be employed in businesses that were planned to be set up by resettlers themselves. In a 1999 article by two resettlement officials,42 the authors said that appropriate arrangements for the Kuangkou resettlers to live and work in the city of Yima failed to materialize, as most of the city-run enterprises were operating at a loss and could hardly take care of their existing employees. The increase of production problems at the large, state-owned Yima Mining Corporation, the financial constrains imposed by the state’s financial austerity policy upon the construction of gas pipelines and the postponement other infrastructure projects by funding delays also made the transfer of Kuangkou villagers to Yima more difficult than anticipated. Th Yima city government had to change the original resettlement plan by asking the resettlers to invest the very money they had received from compensation in four local factories as a precondition for their employment. A total of 1,103 resettlers did so. Meanwhile, 277 farmers managed to find jobs in the service sector, and 452 Kuangkou villagers returned to farming. However, 582 villagers were still waiting for the allocation of land to become farmers again. In reviewing the Yima resettlement experience, the two authors of the aforementioned article (affiliated with the Resettlement Office of the Sanmenxia Municipality and the Second Construction Bureau of the Hydraulic Department of the Henan Provincial Government), wrote: “The Yima resettlement operation exposes some of the major problems in the transfer of rural populations to urban settings and industrial occupations. First, the rural resettlers are poorly educated and lack the dispositions that modern industries require of their employees. If we have learned anything from the economic reforms in our country, it is that modern enterprises not only need well-educated people to work as managers who are familiar with cutting-edge technologies and know-how but they also need skilled and smart employees. Of the 5,570 Kuangkou villagers, 2,414 needed industrial jobs. But surveys show that only 26, or 1.1 percent of these job-seekers, have a college degree. As for high school graduates, there are 269 of them, or 11.1 percent of the total. The number of people who hold vocational school diplomas is 1,786, or 74 percent of the total. There are 222 people, or 9.2 percent of these job-seekers, who have only elementary education. The others, or 4.6 percent of the total, are illiterate. This is a poorly educated horde of rural laborers. Resettling them in an urban setting and finding them industrial jobs will only create problems for the enterprises receiving them. Second, the state-set 42

Zhang Tongfeng and Zhang Yunfeng, “The Practice of Accepting Rural Resettlers into Factories in the City of Yima” (Yima shi gongye anzhi yimin de shijian), Memorandums of Hydraulics, Poverty Relief, and Development of Reservoir Areas (shuili fupin yu kuqu kaifa dongtai), Issue No. 2, 1999, pp. 28-31.



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compensation rate for the transfer of displaced farmers to Yima to lead an urban lifestyle and have industrial jobs was the rate for resettlement in rural areas. These people should have been compensated by and provided with resettlement funds in accordance with the costs for building urban facilities. The city's effort to help the resettlers secure jobs, drinking water, residence, electricity, and access to paved roads was frustrated by too many fees that are typical of urban development, including land utility tax, construction tax, building design tax, cultural relics protection fees, ground-clearing fees, inspection fees, construction supervision fees, contract certification fees, and urban tree-planting fees - amounting to a total of 25 million yuan. The Yima City Government planned to invest 291 million yuan in industrial enterprises to help employ the rural resettlers. The City Power Plant would receive 250 million of this investment. But the state-provided fund for the city's enterprises to employ rural resettlers was only 30 million. The shortage of 261 million yuan had to be secured by bank loans, outside investments, and the contribution by the job-seeking resettlers using their compensation money. Of the four factories that have employed some resettlers, the power plant is most profitable, earning in theory 41.6 million yuan a year. With this earning ability, the plant still needs six years to return the money borrowed. If its earning ability decreases and the interest rate increases, it will take a much longer time for the plant to return the loans. Given these problems, it is unlikely that the resettlers can restore and improve their living standards in a short period. Second, the dam's construction and the resettlement program took place almost simultaneously. Arrangements of residential and other basic facilities occurred together with or even ahead of the creation of jobs in the city. While the resettlers were required to leave the dam site according to a fixed schedule, the creation of jobs for them was still at the stage of feasibility studies, submissions of proposals, evaluations and endorsements of such proposals. All the job-related projects had a rather long cycle to be completed. Thus, these projects were yet to be approved or constructed when the Kuangkou villagers were uprooted and moved into Yima. Most of the resettlers needing jobs did not get them as quickly as planned. For a long time, the resettlers had no regular incomes and their lives were severely hampered by financial difficulties.... We suggest that in the future transfers of rural populations to urban areas, the creation of urban jobs should take precedent over the construction of residential facilities while the latter should take precedent over the construction of dams. The purpose of so doing is to avoid the detrimental situation in which many people are evicted by the incoming water before employment can be arranged for them.” A Few Words on the Yantan Case of Resettlement Turning from the Xiaolangdi Project to the Yantan case of resettlement, the fact that 200,000 rural residents of the displaced farmers were resettled from the Yantan area to two state farms in the Beihai area is a key of the reported success. In other words, the crucial factor for the reported success in this case is the availability of lots of land, actually 23,462 mu in total or roughly 1.2 mu for each of the most needy resettlers in the Yantan Project. The land that these farmers received had been left attended for some years. They used to be farmed by urbanites who had settled down on the two said farms in 1960s. In the late 1970s, many of the farm workers returned to their urban hometowns, leaving large plots of land vacant. Resettling rural people on these state farms does not lead to conflicts between resettlers and local hosts over land resources. But when farmers are resettled in other farming villages, such conflicts over land resources are likely to occur. In addition, a fully developed system of social services at these state farms, including schools, shops, training programs, and welfare facilities, had been already in place. The resettlers did not need to start from the scratch. Furthermore, the two state farms treated the resettlers as assets for turning the vacant lands into crop-yielding fields. Instead of becoming liabilities or competitors for limited resources, the 20,000 resettlers were welcomed. Had they resettled in nearby villages where they would have to compete with local residents for limited resources, they might not have enjoyed the dramatic This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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increase of personal income from 285 yuan in 1992 to 2,166 yuan in 1994. The 200.000 people settling down on the state farms were not ordinary resettlers. They belonged to what the Chinese government calls "double flooding households" ("shuang yan hu"). That is to say, both their cultivated fields and residential areas were flooded. For the relocation of people who lose only their farmland but not residential areas, the government has invented the term "arrangement of productive necessities" ("shengchan anzhi"), that primarily involves finding farmland or reclaiming wasteland. For those who lose their residential areas but not their cultivated fields, the solution is called "arrangement of residential necessities" ("shenghuo anzhi"), which means finding them land to rebuild houses. As for those families losing both farmland and residential land, they are identified as "households in need of double arrangement" ("shuang’an hu"). Problems of the Three Gorges Resettlement Program Unlike other large water projects in China, the Three Gorges Project has been attracting worldwide attention primarily because the officially projected population number for resettlement: more than one million people. The area where the project is undertaken includes parts of Hubei Provinces and areas of Chongqing Municipality at the middle reaches of the Yangtze River. The goal of this controversial project is to build a huge multipurpose hydroelectric dam to reap tremendous economic benefits. For the project to succeed, the Chongqing reservoir area has to play an important role. The reason is that the Chongqing reservoir area suffers the greatest loss in land inundation, has the largest number of people to resettle, and bears more than 80 percent of the project-related damages. Of the entire investment for resettlement, 85.5 percent is for the Chongqing reservoir area. If the success of the Three Gorges Project depends on the success of resettlement, Chongqing must do well. For Chongqing to do well, the relocation of industrial enterprises must proceed smoothly. According to the Three Gorges Construction Plan, the project will take 17 years to complete, between 1993 to 2009. The flood zone includes Wanxian City, Fuling City, and Qianjiang Prefecture, in addition to 18 counties. Altogether, two cities, seven county seats, and 104 market towns will be inundated. A series of reports from China have pointed to failures of the Three Gorges Project’s resettlement program. One report will be cited below extensive. Written by a team of seven financial experts in China,43 this report says that the dam will affect 1,380 industrial enterprises that have a fixed value of assets at 4.8 billion yuan, or 86 percent the asset value of all industrial enterprises and mining establishments in the Chongqing reservoir area. By December 1996, approval of 3,048 resettlement programs had been granted. For industrial relocation, 2.036 billion yuan, or 34.5 percent of the total budget, was invested into the Chongqing reservoir area. This investment includes the state’s offer of 930 million yuan of compensation, 750 million yuan of bank loans, 126 million yuan of raised funds by local enterprises, and 230 million yuan from other sources. The relocation of industrial enterprises has proved to be mired by a number of problems, according to the seven financial experts. In summary, these problems are as follows: 1. It is very difficult to choose a development project that offers good prospects and economic benefits during the relocation process. In addition to the problem of too much administrative interference, industrial relocation has been affected by the tendency of excessive expansion, the obsession with equipment from abroad, and the influence of immodest ambitions at the stage of feasibility studies and development 43

Xie Gaoxin, Zhang Bing, Zen Xiangchu, Wang Yong, Yang Rong, Deng Chaohui, and Ran Yong, “An Investigative Report on the Relocation of Industrial and Commercial Enterprises in the Chongqing Reservoir Area” (Chongqing kuqu qiye banqian daocha baokao), Almanac of China's Finance and Banking, 1998 (Zhongguo jinrong nianjian), 1998, Beijing: Chinese Finance and Banking Association, pp. 324-25. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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planning. On the other hand, there were few intermediary institutions that could help the enterprises relocate by cooperating with other enterprises or organizations. In discussions of the terms of financial and technical cooperation, disagreement between the concerned parties over the division of profits and the sharing investment risks doomed most negotiations. Moreover, disagreement over the question of how to deal with the existing equipment and how to re-employ the current workforce to accommodate the introduction of new technologies and equipment also became an impediment. Issues such as these caused the enormity of problems in identifying and choosing a sound project of industrial relocation to launch. 2. Relocating industrial enterprises that are operating at a loss has proved to be extremely difficult to accomplish. According to our survey results: more than 80 percent of the relocating enterprises in the Chongqing reservoir area are small or medium-sized businesses. Among these businesses, the number of those that are losing money is considerably high. Most of the money-losing enterprises have halted production or reduced their scale of production. They can hardly pay off their debts and are on the verge of bankruptcy. Enterprises like these cannot raise funds for relocation. The relocation funds they have received from the state and the loans they have obtained from banks are too limited for them to relocate. Even if they are forced to move, they are unable to improve the existing technologies or their products, a problem that will prevent them from competing on the market. Thus the day when they complete relocation is the day when they have to declare liquidation. These enterprises therefore lack the incentive to abide by the state policy that they relocation funds they have received or earmarked for them can be only used for purposes of relocation. This problem makes industrial relocation even more difficult to accomplish. 3. The ways that industrial enterprises have been relocated have failed to be compatible with the marketization of the national economy. Some enterprises have ignored their financial limitations, pursued plans of greater productivity, and thus slowed down the relocation process by excessive spending. For example, the Wanxian Light Industrial Machinery Corporation and the Wanxian Veterinary Pharmaceutical Plant were given 15.08 million yuan for relocation and for consolidation into one factory. The new factory, to be build on a 105 mu of land through requisition was planned to be equipped with a production line capable of manufacturing 40,000 tons of cast-iron pipes a year. After groundbreaking on December 16, 1994, only a little more than 10 mu of the needed land was obtained and the purchase of this little land cost the 6.8 million yuan. If the remainder of the needed land is to be purchased this price too, 50 percent of the total investment will spent on buying land alone. Since so much of the investment has been spent and the new factory still has found no other sources of guaranteed funding, the Wanxian Light Industrial Machinery Corporation, which was a profit-making enterprise before relocation, has been plunged into a too difficult situation to eradicate.



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4. The management of relocation funds is lackadaisical and involves too many agencies. The local economic planning commissions are responsible for planning, reviewing, and approving projects in need of funding. The local resettlement offices and banks are responsible for the allocation of funds. Agencies for land administration and taxation are responsible for the requisition of land and the collection of taxes. No agency has the authority to provide integrated supervision over factory relocation. As a result, the whole process of industrial relocation has been affected while supervision and monitoring of particular enterprises are ineffective. Specific problems include the following: First, the relocation funds are spent on too many projects as if the money should be used like black pepper -- scattered evenly without concentration. Second, the relocation funds are not all used for the set purpose. One cause of this problem is the decision by local governments not to distribute the money for relocation but to use it for other ventures. As a result, the relocation of industrial enterprises has been slowed down. For example, in Lidu District of Fuling City, 3.84 million yuan of the relocation funds was used to create a joint venture -- the Hangzhou, Dongbao, & Lidu Corporation. Although this company turned out be relatively profitable, the Lidu District authorities failed to plan the relocation of local factories for which the state had provided the relocation funds in the first place. Another form of financial management is the shift of the relocation funds for factory construction and technological improvement into the realm of consumption such as the construction of dormitories for factory employees. In so doing, the need for the reconstruction of production bases is ignored. 5. The allocation of relocation funds is delayed or not timed with the approval of bank loans. This problem is manifested in two ways. First, cooperation between banks and resettlement offices is inadequate. Funds earmarked for relocating factories and bank loans designated for upgrading factory technologies are managed by separate agencies, making it impossible to be used together and invested simultaneously. Separate applications have to be filed to receive for relocation funds and bank loans. Since the project proposals are different in content and the timetables of reviewing and approving these proposals also vary, the relocation funds and the banks loans cannot be obtained within the same time frame to guarantee construction and production. According to state regulations, the industrial relocation funds must be managed by and deposited at the local branches of the China Construction Bank. But 80 percent of such funds has been transferred to and deposited at other banks. Loans for upgrading technologies are also transferred to other banks. Thus, the China Construction Bank loses the incentive to monitor the use of relocation funds. This explains why factory relocation has encountered poor economic results and why the problem of unregulated cash flow has remained for such a long time. 6. Some enterprises refuse to be responsible for the debts they have accumulated. Specifically, some enterprises, upon receiving the relocation funds, have take advantage of factory relocation, technical upgrading, and structural reorganization to become totally different entities. Thereafter, they are unwilling to assume the responsibility of paying off the debts they accumulated in the past. As a result, the banks cannot recover the loans, and they are therefore less inclined to make to loans to enterprises in relocation. In addition, some enterprises deliberately kept banking officials from getting involved when they declared them bankrupt and sold off their assets through auction. In effect, these enterprises used bankruptcy and auction to avoid debt liabilities. Other enterprises, after transforming themselves into new entities, have disregarded the obligation to re-employ some of their former workers. By getting rid of these workers as a burden, these enterprises have realized the purpose of factory relocation but violated the original intent of taking care of the employees who also have to relocate.



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The Experience of Gaoyang Farmers Problems in rural resettlement are equally disturbing, if not more. In “an emergency appeal” filed the Chinese Communist Party Committee and the People's Government of Gaoyng Township, Yunyang County in 1996,44 the failure of transferring rural resettlers to urban areas to be employed as industrial workers is detailed: “Under the direction and arrangement of the Wanxian City Resettlement Office and the Yunyang County Resettlement Bureau, the Wanxian Textile Factory recruited 370 displaced farmers from Gaoyang Township on April 16, to start work at the factory on July 16. After some 20 days, about 300 of the Gaoyang farmers quit their jobs and returned their homes in the reservoir area. They did so out of dissatisfaction over the pathetic living and production conditions in the factory. Since coming back, these farmers have tried to bother the local government and disturbed all aspects of our work. Their return from the factory disturbs popular morale in the reservoir area and may bring forth bad social influence. We are hereby informing higher authories of the following facts and situations: 1. Recruitment of Gaoyang Resettlers by Dongfeng Textile Factory - On April 16, 1996, three representatives from the Dongfeng Textile Factory, came to Gaoyang Township to recruit 400 workers among local resettlers. They brought with them the official recruitment documents issued by the Wanxian City Resettlement Office, Longbao District Resettlement Department, Longbao District Personnel Department, and Yunyang County Resettlement Bureau. Since the recruitment number was huge and details were not clear, the Township Party Committee and the local government decided to send seven officials and representatives of resettlers to make an investigation tour of the said factory before they decided if the recruited workers should go to work there. The investigation team first contacted section officer Wan at the City Relocation Office. Wan said, "Recruitment of the said factory follows the rules and regulations, and it has the ability to take good care of the recruits. The factory also has a resettlement feasibility report. It was approved and signed Wang Juxuan, head of the City Resettlement Office to allow the recruitment of 400 workers from Yunyang and Wushan counties. There will not be any problems and please do not worry." Our investigation team then talked with the Longbao District Personnel Department and was told, "Please do not worry. The factory's ability to take care the resettlers is great. We have special supervisors there. Do not worry." Our team also made an investigation tour to the old factory site. The team members checked the salary forms in the old factory, inspected the new factory site, and talked to the factory's leaders to understand the nature of its production, sales, and institutional affiliation. The team then reported to the Gaoyang Party Committee and government to the effect that arrangements for the resettlers to live and work at the factory were well done and approved by the City Resettled Office and the Longbao Personnel Department. In addition, the team mentioned that the factory is an county-owned collective enterprise and operates under the supervision of the Longbao District Personnel Department. Since 44

The Chinese Communist Party Committee and the People's Government of Gaoyng Township, Yunyang County, “An Emergency Appeal” (jinji huyu) August 7, 1996.



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Yunyang County Resettlement Office has urged against resettling too many people in one place and given the fact that this recruitment was based on the principle of voluntary employment, the township government of Gaoyang decided not to take side but to publicize the findings of our investigation our tour factually and let the resettlers make their own decision. As of June 11, the Dongfeng Textile Factory had recruited 370 workers in Gaoyang. Workers were to start work on July 16. Before the Gaoyang farmers reported to work, the factory had claimed and taken away 1.75 million yuan from the County Resettlement Office as fees for providing jobs for rural resettlers. At the beginning, however, the recruiter said, "We will process household registration and claim the resettlement fund three months after the recruited farmers begin working in the factory." 2. The Actual Conditions at the Dongfeng Textile Factory - On July 16, 1996, our township official who are in charge of resettlement escorted 370 farmers to the factory. But little preparation was made in advance by the factory. Neither electricity nor water was available in the workers' dormitory. No security measures were adopted to guard the dormitory, leading to two incidents in which female workers from Gaoyang were sexually harassed by hooligans from the outside. Moreover, food was not provided on time. These problems left a bad first impression with the new workers. The following problems further their determination to go home. As the factory leaders were divided, against one another, and and engaged in endless arguments. No leader took charge of the specific procedures of production. After 20 days of reporting to work, the new workers had no water to drink while working in a hot temperature. More than 30 people had to sleep in one room. Most of the workers became ill. Since the they began working, industrial accidents happened every day. When hooligans in the neighborhood entered the factory, beat workers and assailed women with obscenities, authority figures at the factory never intervened. Nor did they bother to do anything when the new workers were injured. In fact, the factory manager rarely appeared during those 20 days. The factory was a mess and the morale low. The factory misused the state's investment of funds designated for the transfer of rural resettlers from agriculture to industrial occupations. Before the factory began normal operation, it had already accumulated deep debts. According to our sources, the factory received 1.75 million yuan of resettlement fees from this recruitment. Out of this amount, the factory used 700,000 yuan to pay off its old debts, 100,000 yuan to rent the dormitory, and 900,000 yuan to buy the factory site, with 400,000 yuan already paid and $500,000 still outstanding. Within three months, each major expense at the factory cost 500,000 yuan. Since the factory leaders were not enthusiastic about pushing for production, the workers performed their duties only when they wanted to and sometime they went out to play. There was no sign of normal production. Thus, the new workers became concerned and believed that the factory lacked a responsible and industrious team of leaders. There was no managerial system in place t allow the factory to compete with other enterprises. The new workers became so disappointed because they figured out that this factory would be closed down sooner or later. 3. Proposals and Requests - In order to prevent fake relocation projects and to enable the displaced people settle down calmly, we suggested in advance to the County Resettlement Office that the relocation money not be released until a trial period of three months and until the workers were all settled down properly. The recruiters of the factory made the same promise too. But since the money had already been released, we want to make the follow requests: This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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First, we ask the factory authorities and relevant government agencies and departments to come to in Gaoyang to take the workers back to the factory, and to resolve all the problems of mismanagement, poor production order, and bad living conditions so that the workers can be at ease while living and working there. Second, if the factory cannot provide proper means of taking care the new workers, please have the related government departments return household registration forms and the resettlement fund to our Yunyang's resettlement office. The return of more 300 farmers to Yunyang plants the seeds of a major social crisis. First, these people will gather in front of the local government to demand that they be treated as improperly resettled people and therefore be given a chance for another round of resettlement. Second, they will not allow the local government to take their names off the lists of people for whom resettlement funds have been already spent. Otherwise, they and their relatives will be united together to refuse the delivery of taxes and levies to the local government.” It should be mentioned that the transfer of some of the rural people into industrial lines of work is meant to reduce the intense population pressure on land in Yunyang county, where Gaoyang township is located. In Yunyang county as a whole, rural resettlement has run into serious problems that have been widely reported in international news media. However, the most reliable source of information on Gaoyang in specific and Yunyang as a whole is an article published by Wei Yi,45 a Chinese sociologist who has intimate knowledge of the resettlement program in Yunyang county. Wei Yi has the following to say about resettlement in Yunyang within the broader context of the Three Gorges Project: 1. The Three Gorges Project will displace 1.2 million people. In the areas under the jurisdiction of Chongqing Municipality, the urban and rural residents who have been targeted for resettlement constitute 80 percent of the total. In Yunyang County of the Chongqing region, 120,000 rural people will be resettled, equal to the total of number of people to be resettled in Hubei Province. The goal of the Three Gorges resettlement plan in Yunyang County, as elsewhere throughout the reservoir area, is to relocate and settle the affected population locally, that is, within the confines of the affected villages and townships. 2. In a county of limited land resources like Yunyang, local resettlement means that hilly lands must be reclaimed. Such efforts so far have only aggravated soil erosion. And because compensation is calculated in part on the basis of land quality, Yunyang County, with its harsh natural conditions and steeply hilly lands, has received less funding than other counties. By contrast, Fuling, a relatively well-developed area that will not be affected by a large population of relocatees, has received much of the technological development loans. 3. Villagers in Gaoyang Township, Yunyang County, have repeatedly appealed to the central government for more resettlement funds. Their appeal has to do, in part, with the regional discrepancies in the amount of compensation that resettlers can get after part of the resettlement investment is used to build community infrastructures such as roads, irrigation systems, schools, and medical clinics. The following figures are the varying rates of per capita compensation for distribution among individuals: 45

Wei Yi, “Major Problems and Hidden Troubles in Relocation of the Three Gorges Project: Focus on Yunyang County, Chongqing City” (Sanxia yimin de wenti yu yinhuan yi Chongqing shi Gaoyang xian weili), Strategy and Management (Zhanlue yu guanli), January 1999, pp. 11-22. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.

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World Commission on Dams Displacement, Resettlement, Rehabilitation, Reparation and Development

Fengjie County: Zhongxian County: Kaixian County: Wushan County: Yunyang County:

9,458 yuan 7,611 yuan 7,306 yuan 7,197 yuan 6,773 yuan.

4. Among the five counties listed above, Yunyang has more cultivated fields to be submerged and a greater number of villagers to be resettled. But it has the smallest amount of compensation to distribute among the local resettlers. The primary cause of this unfortunate situation is the inadequate amount of resettlement funds for Yunyang. Therefore, although it is faced with an arduous resettlement task ahead and needs more investment than other counties, Yunyang has in effect received less compensation. 5. If Yunyang had a viable industrial base to absorb landless and ill-compensated farmers, the problems of resettlement could be greatly eased. But that is not the reality. Although industrial enterprises in Yunyang are encouraged to employ resettled farmers, they have operated at a loss. As some of these factories became bankrupt and were shut down, the farmers who had become factory workers lost their jobs subsequently. The central government has stipulated that all regions and organizations with the great benefits to gain from the Three Gorges Project should help the people in the reservoir area. However, the support comes into Yunyang in the form voluntary donations of money, equipment and other material goods. These donations have been symbolic gestures of aid to this day. For instance, through arrangements by the central government Yunyang County has had Jiangsu Province as its supporting partner. Jiangsu will benefit a great deal from the Three Gorges Project and is also one of the most developed regions in China. What has Jiangsu done for Yunyang? Between 1994 and 1997, Jiangsu donated some 40 million yuan (including material goods) to Yunyang. This amount of monetary and material aid helps but it is not enough to provide a significant boost to the local economy. 5. Resettlers in Yunyang have difficulty accepting the great disparity in living standards in their area and in the regions that will benefit most from the Three Gorges Project. For example, both Yunyang and the downstream Changshu County in Jiangsu Province are similar in terms of population size and in their geographic adjacency to the Yangtze River. However, Yunyang had a GNP of 1 billion yuan with a county revenue of 100 million yuan in 1996. That year, by contrast, Changshu had a GNP of 16 billion yuan and a county revenue of 1.1 billion yuan. Also in 1996, farmers in Yunyang had an average per capita income of 1,200 yuan, as compared to 6,000 yuan per head in Changshu. Some people may argue that it does not make much sense to compare two completely different counties. The point we are making here, however, is that these counties are linked together by the Three Gorges Project, with Yunyang having everything to lose and Changshu having a lot to gain. 6. The carrying capacity of the reservoir region is already at its saturation point. Considering this factor, the policy of local relocation, which means even less land to farm and many environmental problems to deal with, will probably make the reservoir region even more underdeveloped. 7. Adding to the ecological constraints, official corruption has directly and adversely affected resettlement. Although the government has severe punitive measures in dealing with official who mishandle resettlement funds, quite a number of local officials have embezzled a lot of money. In Yunyang, over 2 million yuan of the resettlement funds has This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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been embezzled. Charged with embezzlement, the head of Yunyang’s resettlement office has been sentenced to prison. In addition, seven resettlement officials responsible for the construction of the new county seat have been disciplined upon charges of corruption, embezzlement, and negligence of duties. At the township level, six local cadres who embezzled and misused resettlement funds have been removed from their positions. One link between official corruption and resettlement problems is the emergence of "fake resettlers." Many township officials have inflated the numbers of resettlers in their localities in order to get more money to put their own pockets. This practice has created the problem of disorderly and dishonest distribution of compensation, which was at the center of several protests by real resettlers. Feeling that their interest was comprised, these resettlers lodged complaints with the central government with corrupted local officials.



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The conclusion that Wei Yi has reached on the basis of his research in Yunyang is that the central government must reconsider the existing policy of resettling people locally. Some of the people in the Three Gorges area must be relocated to other places, says Wei Yi, because local resettlement is faced with too many problems to overcome. But all areas suitable for agriculture in China have already been densely populated, and therefor it is difficult to find similar places settled residents in the Yangtze valley. To assuage the tensions of social instability that would be caused by the resettlement in the next dozen years, the best solution is probably to lower the dam's planned height so as to reduce the total number of people to be relocated. For example, if the normal water level in the reservoir were lowered to 160 meters, and the flood control level to 130 meters, more than 500,000 people would not have to be relocated. In short, the resettlement problems must be taken seriously and solutions badly need be found. If not, Wei Yi suggests, social instability in the Three Gorges area is bound to cause far-reaching consequences. Conclusions: China is both blessed and cursed by the forces of its seven major rivers.46 These mighty cascades of water produce great agricultural bounty but they also can cause devastating floods. Ever since the art of irrigation was fully developed in ancient China,47 river management - shui zheng in Chinese - has been designated as a special function of governance, and it has played a crucial role in the lives of ordinary people. Thousands of Chinese farmers would be on their kneels thanking river gods when severe floods left local dykes intact. An emperor’s Mandate of Heaven would be brought into question if a large river changed its course to destroy everything in its path. Popular belief had it that evil in this world was the cause of the river dragon’s horrific wrath. Before officials in charge of river management would be implicated, the first victims of the river dragon’s anger over human offense were the people of farming communities in densely populated valleys. So from the beginning of China’s recorded history, countless morality tales have been passed down from one generation to the next on how human righteousness may tame the river dragon’s temper. It is no exaggeration to say that China surpasses all other nations in investing so much of its economic and cultural energies into river management. A fundamental difference of river management in China before 1949 and thereafter is the construction of large hydroelectric dams. In 1949, as said earlier, the country had no more than 40 small hydroelectric dams and only a handful of large-scale reservoirs. At the height of the Great Leap Forward, a nationwide campaign was launched by central authorities to build dams and reservoirs not only on major rivers but also along hundreds of smaller tributaries. By 1985, the state-organized drives for electricity, irrigation, and flood control succeeded in building 70,000 dams and 80,000 reservoirs. Of these waterworks, nearly 300 were big hydroelectric dams and 340 were large-scale reservoirs. By 1992, when construction for the controversial Three Gorges Dam project was approved by authorities in Beijing, China already had 369 large-scale reservoirs. The material in this perspective paper should make it abundantly clear that China’s resettlement policy before the 1980s was ill-conceived and often forcibly implemented. While the country’s current policy for resettlement still relies on involuntary resettlement, the difference is the government’s emphasis on treating resettlement as part of a more comprehensive plan for the development of local economies, not merely as a matter of moving people out of the designated dam or reservoir sites. Being a theoretically sound principle for resettlement, the new policy is an encouraging progress away from the disastrous policy in the past. In addition, China has developed a large bureaucracy for and a planning culture in dealing with large-scale resettlement. In practice, however, a rosy picture of the developmental 46

The seven major rivers in China are the Yangtze River (6,300 km), Yellow River (5,500 km), Heilongjiang (3,100 km), Zhujiang (2,200 km), Liaohe (1,400 km), Haihe (1,100 km), and Huaihe (1,000 km). 47

The world’s oldest operating river diversion system, built in the 3rd century B.C., is the Dujian Dyke on the Min River in China’s Sichuan province. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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resettlement policy is hard to pain due to a variety of reasons. Of these is the restructuring of the Chinese national economy. As more and more older and less educated factory employees are laid off to raise efficiency and reduce the financial burdens of state-owned factories, the transfer of rural resettlers into industrial lines of work is increasingly becoming an illusion, even in cases such as the Xiaolangdi Project in which an international agency - the World Bank – plays a major role. All studies of reservoir resettlement in China conclude that access to farmland, preferably in the vicinity of the hometowns of the targeted rural people, is the key to successful resettlement, especially in building large-scale dams and reservoir in tensely populated areas. However, the reality is that little extra land is available in these areas and hence the creation of industrial or service jobs must be guaranteed. Otherwise, resettlement will fail. Furthermore, a relatively new problem in some of China’s resettlement programs is official corruption, as suggested by Wei Yi’s article. And according to the National Audit Office in early 199, officials had embezzled 232 million yuan from funds earmarked for resettlement in the Three Gorges area.48 Moreover, China is faced with the double burden of coping with both old and new problems of reservoir resettlement. Take the Danjiangkou Project in Hubei Province for example. A report on this project by an veteran resettlement official, Huang Yinggui,49 reveals that the project, started in 1958 and completed in 1974, has an inundation zone covering four rural counties and 345 villages. Within the reservoir area, there are 71,876 households containing 278,841 individuals. Of these, 238,765 people in 64,249 households are rural residents, mostly resettlers who must rely on 181,189 mu of cultivated land to make a living. This comes to 0.73 mu of arable land per head. Although the Chinese government had tried hard to improve the living standards of the resettlers in the Danjiangkou area in the 1980s and 1990s. there remained in 1997 many unsolved problems. In the areas around the city of Shiyan, more than 8,000 units of housing and 2,000 elementary schools were in dangerous conditions. In the same year, the shortage of drinking water was still a problem affecting more than 5,000 households. Forty percent of the relocated villages were without roads wide enough to allow handy tractors to go through. There were 18,000 people in 4,900 households who did not have any electricity as late as 1997. Contributing to these lamentable conditions of living so many years after resettlement is the fact that 50 percent of the cultivated land available to the resettlers is on mountains with a 25 degree of incline, making these fields difficult to irrigate. Most of these lands are also small in size, dry, and infertile. Most of all, about 40 percent of the resettled villagers own less than 0.3 mu of productive land. According to Huang Yinggui, the shortages of land help explain why in the areas around the city of Shiyan there were - in 1996 - 35,148 resettlers whose annual income was less than 530 yuan, that is, below the official poverty line. China’s transition to a market economy also has hurt the resettlers in the Danjiangkou area, according to Huang Yingkui. In experimenting with a market economy, the Danjiangkou resettlers no longer can enjoy inexpensive materials provided by the state. They have to buy everything needed for agricultural production from the market. As a result of the liberalization of food prices, the original supply of inexpensive grain by the state is also gone. In addition, the price for electricity has been raised. Many farmers cannot afford electricity anymore and therefore have stopped irrigating their fields. In short, while the Chinese government must properly handle the resettlement programs of new water projects, the seriousness of the problems associated with completed projects continues. It is not only too early but also fallacious to declare China as a model for the world in handling population resettlement in the construction of large-scale dams and reservoirs. Even Chinese officials have repeatedly stated in 48

See e.g., Jasper Becker, “Dam Cadres ‘steal 217m’.” South China Morning Post, February 14, 1999, p. 1. Note that the figure of embezzled money cited in the headline is converted from Renmibi yuan into Hong Kong dollars. 49

Huang Yinggui, “The Present Situation and Ideas on Economic Development in the Danjiangkou Reservoir Area” (Danjiangkou kuqu xianzhuang yu jingji fazhan silu), Memorandums of Hydraulics, Poverty Relief, and Development of Reservoir Areas (shuili fupin yu kuqu kaifa dongtai), Issue No. 2, 1997, pp. 9-15. This is a working paper of the World Commission on Dams. The report herein was prepared for the Commission as part of its information gathering activity. The views, conclusion, and recommendations are not intended to represent the views of the Commission.


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writing that resettlement for new project remains a taunting task for them to accomplish while there are a great many unsolved problems from the past for them to tackle. Their candid assessments of the station are the basis of this perspective paper, and they should continue to serve as the basis of evaluations to be conducted by the World Commission on Dams in the future.
