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Water in a Multipolar World: China and the Issue of Water Management

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Natasha Hall

On July 17, Iranian president Ebrahim Raisi opened the Chamshir Dam. In spite of vociferous opposition from environmentalists, who argued that the dam would cut off the water-impoverished and neglected province of Khuzestan from the Zohreh River, construction proceeded—supported by a 244 million USD loan from China. China’s role in the Chamshir Dam is representative of the country’s increasing influence over shared water resources worldwide. Charting its own course in the face of international environmental standards, China’s dam diplomacy is poised to escalate global tensions and threaten water security.

The financing and construction of dams is an important but little-understood component of Beijing’s larger agenda to promote its vision of sovereignty in multilateral fora around the globe. Over a decade ago, China’s Sinohydro, a state-owned dam-building giant, claimed more than 50 percent of the market share of new dams erected around the world. China itself has more large dams in service than every other country combined. Many of these dams (both in China and elsewhere) lack transparent water-sharing agreements between local and regional authorities, or even notification of those affected by such projects. Just last year, Kurdistan’s regional government signed a memorandum of understanding with Power China to build four new dams—unbeknownst to the federal government in Baghdad at the time.

On the international stage, China has sought to block agreements governing the use of international rivers, maintaining that upstream countries must be free to develop their part of shared waterways. For example, in 1997, China was one of only three countries that voted against the UN General Assembly resolution to approve the UN Watercourses Convention. The flexible legal framework sought to establish basic standards and rules for cooperation between riparian states on the use, management, and protection of international waters. Yet despite building numerous dams upstream of the Mekong, Brahmaputra, and Indus, China lacks even a single transparent and binding water-sharing arrangement with the affected downstream neighbors.

Many analysts believe that Beijing will use the dams for political leverage in its own backyard, increasing water releases to improve relations with downstream countries and diverting water to exert pressure. This is partially why there is so much anxiety over one of its planned projects on the Brahmaputra basin. The Great Bend Dam—positioned close to China’s heavily militarized frontier with India—will reportedly be the largest in the world. Rather than engaging in transparent discussions about the implications of the dam, China has cloaked the project in secrecy.

China’s actions on waterways reflect its overarching approach toward foreign policy. In the government’s view, sovereignty implies the right to manage resources as Beijing sees fit—even if those policies violate the rights of populations within and across borders. Rather than allow third parties or multilateral organizations like the United Nations to impose regulations within its borders, China maintains that countries have the right to act as they choose. But while Beijing is reluctant to sign comprehensive agreements with countries downstream from its rivers, it does have these agreements with its upstream neighbors, Kazakhstan and Russia, suggesting that China does not consistently apply its principles when its interests are at stake.

Beijing’s influence over transboundary waters does not stop in Asia. At the UN Security Council, China advanced its sovereignty argument in the debate over the Grand Ethiopian Renaissance Dam (GERD) project. As the downstream country, Egypt sees the GERD as an existential threat to the Nile River, from which nearly 112 million Egyptians get their water. In spite of China’s comprehensive strategic partnership with Egypt, China is helping the Ethiopian government devote resources to the GERD by supporting nearly 400 development projects (to the tune of almost 4 billion USD). It is also financing transmission lines from the dam to cities and villages in Ethiopia, and Chinese dam-building companies are also engaged in building the GERD itself. Nor does China’s influence stop at Ethiopia’s border: it has financed dams on the Blue Nile in Sudan, further affecting the water supply in the Nile basin.

Egypt sought a binding agreement on the GERD’s construction and operation from the United Nations, but China insisted that the parties resolve the dispute at the regional level, even as those negotiations ground to a standstill. China rebuffed requests to use its economic leverage to get Addis Ababa back to the negotiating table on the GERD. Ethiopia followed suit, refusing U.S. and World Bank efforts to restart talks.

China’s growing influence around the world could create new challenges for transboundary river cooperation, and it poses distinct challenges for conflict management and cooperative development. Peaceful transboundary water sharing relies on transparent agreements between riparian countries—agreements China does not require when financing new dams on international river basins. Nor does construction of such dams follow international environmental and social standards. Unlike in the West, where institutions are susceptible to external pressure, Chinese civil society cannot effectively critique its dam construction practices, and Beijing resists international demands. The same is not true of Western institutions like the World Bank, which declined support for the Bisri Dam in Lebanon and the GERD due to international pressure and civil society concerns.

Bilateral development agencies and other international multilaterals like the World Bank are taking the transboundary challenge on, but China could be an obstacle to those advocating for the equitable use of shared water resources. Though Chinese-built mega-dams are trumpeted as the answer to water insecurity, the benefits of big dams tend to accrue to politically powerful groups with important transnational allies. Yet the social and environmental costs—displacement, shrinking biodiversity, and water insecurity—tend to fall on those outside of elite circles. A case in point is seen along the Nile basin, where, despite violent protests, Chinese engineers have not altered course and factored in the impact of climate change on new irrigation projects for water-intensive cash crops for export.

Dams symbolize China’s emerging status as a global power, and its increasingly influential role gives China tremendous leverage over countries across transboundary basins. Working with China to promote sustainable water management will be essential as Beijing is positioned to play a unique role in exporting water saving and monitoring technology and mitigating tensions. In spite of China’s role in the GERD, even Egypt has acknowledged Beijing’s importance. The Egyptian Parliament has called on state institutions to cooperate with China on projects aimed at developing and conserving water resources such as desalination plants and recycling wastewater for use in agriculture. At the same time, China’s political and economic weight with countries that do not have close relationships with the West could also mitigate tensions stemming from water resources. For example, China could use its relationship with Iran to help Iraq overcome the negative aspects of Iranian influence on the country such as Iranian dams impeding the flow of water into Iraq. In 2022, Iraq received only one-tenth of the water that came from Iran in the past.

To date, China has opted not to play peacemaker, expressing its reluctance to interfere with other countries’ domestic issues. Yet, China also resists calls to follow international standards and policies. As a result, its international projects and investments risk profound social, environmental, and violent consequences. Traditional multilateral development banks and Western donors must improve their effectiveness in promoting transparent and equitable water sharing and management, and they must raise awareness of the consequences of unsustainable dam construction. Building long-term support for river basin organizations between riparian countries will also foster more cooperative and balanced water sharing. Recipient countries need to understand that shortcuts will harm their longer-term interests.

Sustainably managing dwindling water supplies will be increasingly difficult to do even without great power competition. But whether through cooperation with China or competition with it, the world will have to meet the challenge.

Natasha Hall is a senior fellow with the Middle East Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Ashok Swain is head of the Department of Peace and Conflict Research, UNESCO Chair on International Water Cooperation, and director of the Research School for International Water Cooperation at Uppsala University, Sweden.