U.S. Could Find Itself Up a River Without a Stake in Dam Project

SANDOUPING, China — The government’s steadfast determination to move ahead with the Three Gorges Dam project is likely to put more pressure on the U.S. Export-Import Bank to provide concessionary credit--a mixed package of export credits and foreign aid--that will allow major engineering and equipment firms to participate in the world’s largest construction project.

Some U.S. companies--notably Caterpillar, which sold China most of the earthmoving equipment at the site, including dozens of giant dump trucks--have already profited from cash sales.

But others, including manufacturers of electric generators and turbines, feel that they will be left out without a change in U.S. policy that will put them on an even footing with European and Canadian competitors that benefit from concessionary credit. To them, the irony is that the U.S. could be left out of a project that was originally the brainchild of American engineers, including the legendary post-World War II dam builder John L. Savage.

On Saturday, one of the handful of foreign guests attending a “river closure ceremony”--in which the main channel of the Yangtze River was blocked to permit construction of the hydroelectric dam--was Alex Taylor, chairman and CEO of the Canadian engineering consulting firm AGRA Monenco, which won a $35-million contract to develop a computer-management program for the dam project. In conversations with U.S. diplomats in Beijing, Chinese officials confided that they would have preferred to use a U.S. firm in the management contract but were attracted to the low-interest financing offered by the Canadian government.