n took office, Interior Secretary Bruce Babbitt canceled the project under pressure from environmental NGOs. In 1992, because of the increasing influence of more environmentally-attuned officials appointed by President Clinton, the Congress added a requirement to the Ex-Im Bank’s mandate that environmental reviews be conducted for foreign projects that sought its backing, and the project became the first serious test of the new guidelines. The Ex-Im Bank asked the National Security Council (NSC) to convene a panel to evaluate the costs and benefits of American participation. In 1993, the U.S. Bureau of Reclamation statedofficially that it was no longer convinced thatmegadams were economically feasible or environ mentally sound. It also stated that it will not fund any such dams anywhere in the world. In September 1995, the interagency NSC panel recommended to the Ex-Im Bank that it should not help finance American companies in bids to assist in the construction of the dam. Deputy National Security Adviser Samuel R. Berger cited three broad reasons why the Bank should not support the project: First, we think it would be unwise for the United States Government to align itself with a project that raises environmental and human rights concerns on the scale of the Three Gorges. Second, any decision to provide assistance would present legal difficulties as environmental and human rights group are threatening to sue the Bank if it became involved. Third, the White House has expressed concern about the project’s financial viability as private bankers and the World Bank have raised serious questions about the Chinese government’s estimates of its cost and economic benefits (Dunne 1995). The memo also added a clause that counseled the government to “refrain from publicly condemning the Three Gorges project,” and to “emphasize the U.S. government’s commitment to strengthening commercial relations with Ch...
