The Erdeneburen project would displace hundreds of herder families. (VWPics via AP)
As China marked the 10th anniversary of the Belt and Road Initiative with leaders from participating nations in October, President Xi Jinping declared that the program had begun prioritizing smaller and greener projects.
The Chinese leader was implicitly addressing criticism that his signature international development program has produced white elephant infrastructure around the world that has burdened partner nations with unserviceable debt and wasteful environmental damage.
Yet at the same event where Xi spoke, he also signed off on loans for an infrastructure project in the far west of neighboring Mongolia that will be anything but small and green.
The Erdeneburen hydropower project involves building what will be Mongolia’s largest dam. The 90-megawatt project will cost an estimated $266 million, with the loans approved by Xi covering 95% of the bill.
The surrounding western region of Mongolia, which is not connected to the country’s main power grid, currently uses only around 51 MW of energy. As most of that power is now imported from Russia, the dam offers the promise of bringing energy independence.
Yet the 24-kilometer-long reservoir that would be formed behind the dam on the Khovd River would displace hundreds of herder families, submerge lush pasturelands they depend on and engulf numerous archaeological artifacts.
Proposals for building a dam on the Khovd kicked around for years, but Erdeneburen really took shape in 2018 when it was included on a list of potential projects to be financed by a $1 billion soft loan from the Export-Import Bank of China.
In 2021, state-owned Power Construction Corporation of China was selected as a turnkey contractor to build the dam, and a local company carried out an environmental impact assessment. Anxious about the rapidly building momentum for construction in an ecologically sensitive area of a national park, a local citizens’ council voted to call a halt to the project, and representatives were dispatched to travel 1,500 km to Ulaanbaatar to demand parliamentary intervention.
The following year, the national government abruptly dismissed the governor of Khovd province for holding up Erdeneburen and also launched an investigation into opponents of “strategic development” projects. During a subsequent visit to Ulaanbaatar in August 2022 by Chinese Foreign Minister Wang Yi, the national government pledged to accelerate Erdeneburen.
As part of its own environmental impact assessment in relation to its funding of a transmission line from the dam, the Asian Development Bank last year found serious issues with the local company’s impact assessment for the dam itself.
The bank noted that the earlier report had erroneously omitted a site covered by the 1971 Convention on Wetlands from its scope and that it had failed to determine the biodiversity conservation habitat status of the impacted area. The ADB report also cited an absence of a detailed operational plan, among other flaws.
Local environmentalists, who have been smeared by public officials and threatened with prosecution, have warned of the dangers of fundamentally altering the wetlands highlighted by the ADB and the dam’s potential impact on the habitats of migratory birds, species of fish found only in the area and the snow leopard.
Opponents argue that the government is potentially displacing hundreds of families without an adequate notion of the real scale of the socioeconomic and environmental costs of Erdeneburen. One of those impacts could be to increase conflict among different ethnic groups whose frontier pasturelands are governed by customary law, with the risk of trouble between ethnic Kazakhs and Mongols of particular concern in this area due to tensions over other incidents in recent years.
Western Mongolia would benefit from being able to tap its own power resources, and this would also remove a drain on the country’s foreign reserves. But Erdeneburen is far bigger than what the area requires, so its environmental and social impacts appear hard to justify.
Given how BRI-financed dams and other infrastructure in Southeast Asia and Africa have caused serious damage to the environment and indigenous rights, Mongolia should realize that it cannot afford to repeat the mistakes of others and take risks that it has very little ability to mitigate.
The authorities should look at smaller-scale ways to tap the area’s hydropower potential that would pose less of a threat to the area’s unique ecosystem and the livelihoods of its diverse population. Instead of threatening civil society and strong-arming local officials, Ulaanbaatar needs to rebuild trust with area communities and chart a precautionary approach in implementing such risky projects.
Munkhnaran Bayarlkhagva, previously a staff member of the National Security Council of Mongolia, is an independent geopolitical analyst in Ulaanbaatar for Nikkei