China may scrap the $3.6 billion massive Myitsone dam in Myanmar in exchange for other economic and strategic opportunities, The Irrawaddy News Online reported on Thursday.
Burmese President U Htin Kyaw who is currently in China will discuss the dam project with his Chinese counterpart, according to two senior Burmese officials.
Until recently, China had been actively pushing for the 6,000 megawatt project to go ahead despite widespread opposition in Myanmar forcing suspension of the project since 2012.
An informed source said China is discussing alternative options with Myanmar, including development of a string of small hydropower projects and securing preferential access to a strategically important port to compensate for the shelving of the dam project.
The dam project was supposed to supply 90 percent of the electricity to China’s Yunnan province, angering many in electricity-starved Myanmar. But in recent months, China’s appetite for the project has diminished as Yunnan now has an oversupply of electricity as it switches to less energy-intensive industries amid an economic slowdown.
With “One Belt, One Road” ambitions of improving links with central Asia and Europe, China wants a face saving solution that would allow it to advance its other economic interests if it shelves the dam project, said a senior Burmese government official.