ina and to helping China meet its basic energy needs” so as to avoid afflicting already strained United States-China relations (Companies Turn Up 1996). Eight months later, the Ex-Im Bank recanted its former proposition that large hydroelectric projects are environmentally beneficial, and voted unanimously not to issue a letter of interest for the project. According to Martin Kamarck, Ex-Im Bank chairman at the time of the ruling, China had failed to “establish the project’s consistency with the Bank’s environmental guidelines” (Tomlinson 1997). This marked the first time the Ex-Im Bank refused financing on purely environmental grounds (Ex-Im Bank Rejects 1996). The Ex-Im Bank, however, stated that if the Yangzi Three Gorges Project Development Corporation, the project’s sponsor, provided additional information on plans to mitigate environmental degradation, it would reconsider its position. It also stressed that its decision would not in any way limit or impede American companies from doing business related to the project on private terms or with financing from other sources. However, because China demands export creditguarantees (essentially insurance to covercontracts) and supporting loans from contractorson all major Three Gorges deals, the Ex-Im Bank’sruling hindered most U.S.-based applicants’chances. As construction proceeds, the Japanese,Germans, French, and Canadians have steppedforward to help their companies garner a piece of the project, while American firms look on and suffer losses that they say could amount to over $1 billion in exports and 19,000 jobs. Using private financing over the past few years, for example, Rotec Industries, an Elmhurst, Illinois engineering firm has sold cranes and conveyor belts worth around $50 million to the dam developers and executives reckon a further $100 million of similar equipment will be needed (Tomlinson 1997). But without export credit g...
