Hydro prospers under economic reform

Prior to 1978, hydropower construction in China was arranged entirely by central government in a system that neither required, nor offered opportunities for competition. The economic reform and policy of greater openness declared by the government in 1978 released the taboo on foreign loans from the West. Such loans, however, brought with them contracts which required competitive bidding for projects. Gradual acceptance of this system has been achieved as its benefits have been demonstrated. Chief amongst these is cost effectiveness, effective introduction of advanced techniques from abroad and efficient management in hydropower construction contrasting with the waste engendered by the old system. Competitive bidding has spread to many other projects in China, including some entirely financed by domestic funds, and economic reform has promoted hydropower development at different levels. Examples are given of joint ventures between central and provincial governments for the construction of large hydro schemes, increasingly important medium-sized hydro plant construction at county level and the boom in mini-hydro sets for family or small village use. (UK)