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In a remote corner of western Ghana, close to the border of Côte d’Ivoire, is a new village. But it’s unlike the many villages you drive through to get there, with their mud houses and now seemingly ubiquitous mobile phone card sellers sitting under their bright, branded umbrellas.

This new village has around 250 Chinese in it, 60 Pakistanis, and 2000 Ghanaian workers, many with families. The houses are prefabricated cabins laid out in neat rows and it even has broadband connection. Barely twelve months ago this village did not exist, but is the work camp for the Bui Dam. This hydroelectric project is being built by the Chinese company Sinohydro and is one of a growing number of dam projects in Africa and the rest of the developing world being funded and built by China.

The workcamp for Ghanaian workers.
[Image by Giles Mohan © copyright Giles Mohan]

The case against such dams is persuasive. They are seen as ecologically damaging and socially disruptive and they often arise out of non-transparent governance arrangements. Moreover, some people question whether such energy-intensive development should be encouraged at all. On the other hand, for many African countries, their infrastructure is so poor that basic welfare is compromised as roads are often impassable and electricity for basic activities is erratic or non-existent. So things like the Bui Dam can be seen as absolutely vital for Ghana and countries like it. Such questions are important and there are no easy answers. One approach is to evaluate them on a case by case basis.

The company contracted to build Bui Dam is the Sinohydro Corporation. It was one of the main contractors on the Three Gorges Dam in China and, as part of the government’s “Go Out” policy, has embarked on an ambitious internationalisation strategy with projects in 50 countries. However, according to the International Rivers Network, Sinohydro has repeatedly received low grades by China’s State-owned Assets Supervision and Administration Commission for its poor safety record, construction and environmental accidents, and pollution. Indeed, some even blame the Sichuan earthquake of May 2008 on geological problems created by dam construction in the region.

The Bui Dam, and others built by Sinohydro, are “EPC” projects, meaning “engineering, procurement, construction”. This is the preferred route for many African governments since the price is agreed up front and fixed. The Chinese favoured the dam project as opposed to the Ghanaian Government’s preferred option of a railway from the coast to Burkina Faso in the North, because the sale of electricity would guarantee repayment in a way that a railway could not.

When it comes to these large Chinese projects, rumours abound about the importation of labour, some of it even sourced from convicts, and also that the Chinese import all the capital equipment and inputs and that they treat local workers badly. How true is this?

Much of the capital equipment is Chinese. Most of the heavy vehicles and the quarrying and aggregate plant are Chinese (although the aggregate crusher is American). The dam is the first in Ghana to be built using roller compacted concrete as opposed to rock fill and so requires huge amounts of cement which is coming from Ghacem, in Ghana’s main port city of Tema, which is German-owned.

The dam site.
[Image by Giles Mohan © copyright Giles Mohan]

The contract with Sinohydro specified the upper limits of Chinese labour on the project, which meant recruitment of unskilled and semi-skilled labourers from within Ghana. Interestingly, the Chinese have brought in 60 Pakistanis to drive the heavy equipment who count as “Chinese” for purposes of the imported labour quota. Communication is a problem but the Chinese organise in small work teams with one Chinese foreman and one Ghanaian foreman, both of whom have some English, and 3-4 Ghanaian labourers under them. Even then much communication is via drawings. Chinese corporations in general do not encourage trade unions, and originally did not allow for it at Bui. But a deputation from the Ghana TUC argued that it was enshrined both in Ghanaian law and the contract and so they had to. The union has pushed for better protection from the debilitating black fly which comes during the rainy season, although this threat affects all workers and is being dealt with through a daily insecticide programme.

All the Chinese labour is male and they sleep in the dormitories. In theory, they are not allowed to drink alcohol, but socialise in a club with TV and table tennis. Mixing between Ghanaian and Chinese workers of all levels is limited although there are “inter-national” soccer games, which one Ghanaian official told me proudly were always won by the Ghanaians and that in general the Chinese were “not friendly”. The Bui Power Authority’s role during construction is essentially to monitor the delivery of the contract and so it has its own engineers to report on quality and progress, and to monitor health and safety and environmental standards. One engineer joked that the Chinese don’t care about hard hats and pointed to a tree that they had saved given that the Chinese were too willing to remove it.

Chinese and Ghanaian workers.
[Image by Giles Mohan © copyright Giles Mohan]

Sinohydro and other Chinese firms are looking to deepen their footprint in Ghana and Africa more broadly. Although the Chinese seemed to have got a foothold in Africa through these semi-commercial, Chinese government-supported projects they are now competing more openly for tenders and, as one European aid official told me, “winning in straight fights”. For example, one Chinese firm is building roads in Northern Ghana funded by French aid, and Sinohydro also has plans for four smaller dams in Ghana.

But these are essentially turnkey projects and so have limited multipliers locally, which is why it is so imperative that African governments ensure that local content agreements are written into contracts. That said, African infrastructure needs are so chronic and have been so overlooked by donors for years that the Chinese are welcome for the investment they bring and the speed of their operations. They look set to continue for many years to come.

For more information on China and Africa see http://www.geography.dur.ac.uk/projects/china-africa/. And on the Bui Dam see
http://www.sinohydro.com/ and http://www.buipowerauthority.com/.

About the author

Dr Giles Mohan is a Reader in the Politics of International Development at the Open University. His research has examined politics in Africa, particularly ways in which rural communities access the government as well the role of diasporas in national politics.

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African democracy often seems like an oxymoron. We hear so much in the western press about corruption, failed states, dictatorships, ethnic violence, and disputed elections that many would be surprised to find that anything like ‘normal’ politics occurs in Africa. But in Ghana there has just been a very close presidential election that saw the opposition candidate win by the tiniest of margins. On 7^th January Professor John Atta Mills was sworn in as President, representing the National Democratic Congress (NDC) who displaced the New Patriotic Party (NPP) that had governed for two terms. The NDC conspicuously borrowed from President-Elect Obama’s campaign by arguing that ‘A Change We Need’ although in terms of economic policy there is not a lot to tell between the two main parties.

NPP election billboards in Accra.
[Images by Giles Mohan, © copyright Giles Mohan]

Although the credit crunch and global recession have affected many developing countries in terms of demand for their commodities and availability of credit, Ghana already had a huge budget deficit compared to the size of its economy. So, like all governments, it is concerned with what will drive the country’s economy. Last year, after much speculation, oil was discovered in the west of the country, mainly offshore, but with the possibility of land-based reserves. For a country dependent on oil imports and a massively over-stretched energy generation infrastructure this was great news. No sooner had the discovery been confirmed than the NPP president hailed Ghana’s economic problems to be greatly relieved. Domestically people were cautiously hopeful, but have witnessed the plight of their near neighbours in Nigeria who have massive oil wealth, but are dogged by corruption, environmental damage, and growing inequality and so are desperate that Ghana doesn’t go down the same path.

Internationally, the oil producers began arriving. Initially the discovery was through a UK-US consortium, but the Chinese were soon in negotiations to secure drilling rights in one of the off-shore blocks. The Chinese, like all industrialising countries, need to secure energy supplies and so see sub-Saharan Africa as a region that is under-exploited, although one with higher than average risks for investment. Already the Chinese are well-established in Sudan, Angola, Gabon, and Equatorial Guinea with Ghana representing the latest addition to a string of producers bordering the Gulf of Guinea. With oil production due to begin within the next two years it is a critical period for Ghana and the new NDC government who have the benefits of this new revenue stream, but also need to manage the potential downsides.

Ghana’s energy problems run deep. When I was in Accra last month we had power cuts everyday as the water levels in the Volta Dam, Ghana’s main source of electricity, dropped during the dry season. Here, again, the Chinese are heavily involved in energy production through the construction of another hydro-electric dam in the north-west of the country at Bui, and a power plant near Accra.

Sign for the power plant near Accra built by a Chinese State construction company.[Images by Giles Mohan, © copyright Giles Mohan]

As part of China’s development assistance and more commercial considerations it has given low interest loans to the Ghana Government for the Bui Dam. The original plans to dam this part of the Black Volta River began in the 1920s and both the Soviet Union in the 1970s and the French in the 1990s looked at the feasibility of the project. However, it was the Chinese who offered the most favourable finance package and the cheapest tender, and got agreement from the Ghana Government in 2005. The Chinese contractor, Sinohydro, is a major multinational and is well under way to finishing the project with electricity beginning to flow in December 2011.

Although Chinese firms in Africa have been criticised for importing their own labour the agreement ensures that jobs go to Ghanaians with about 700 Chinese expatriates working on the project compared with 3000 Ghanaians. Already we have seen migration of job-seekers from other parts of Ghana to the remote Bui site. Bui is also a national park and about one-third of it will be lost to the dam with associated loss of land and wildlife. However, despite some rumours on the web about an anti-dam lobby we made inquiries among a number of NGOs in Ghana and not one of them seemed opposed to the dam, which will add 400 MW of power to the grid. And there are plans to build Bui City next to the dam, which one official optimistically said would be “like Dubai”. All in all, then, these are interesting times for Ghana where the people deeply crave the infrastructure of modernisation and have new lines of finance from China and the prospects of oil revenue.

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About the author

Dr Giles Mohan is a Reader in the Politics of International Development at the Open University. His research has examined politics in Africa, particularly ways in which rural communities access the government as well the role of diasporas in national politics.

Subscribe to Giles Mohan's posts