After decades of large-scale infrastructure projects carried out by the Chinese Communist Party (CCP), they are once again accelerating forward with a new round of developments. Following the high-speed rail projects, a batch of canal projects are either underway or in the planning stages. Official media emphasize the need for economic development, but experts point out that digging canals will disrupt the water system and potentially lead to more flooding. Questions have arisen about the funding for these canal projects, and analysis suggests that even if the projects are forcefully initiated, they may end up incomplete.
In recent years, apart from projects like the Xiong’an New Area touted as millennium initiatives, the Xi Jinping administration is planning a series of ambitious mega water conservancy projects.
According to a recent report by financial media, the construction of the 134.2-kilometer Pinglu Canal in Guangxi started in August 2022 and is expected to be completed by the end of December 2026, connecting Nanning in Guangxi to the Beibu Gulf. The investment in the Pinglu Canal exceeds 70 billion yuan. As of June 2024, official figures show that over 33 billion yuan has been invested in the canal, with over half of the excavation completed.
Officials claim that the Pinglu Canal will be the first canal built by the CCP after taking power, and once completed, it will become the shortest, most cost-effective, and convenient sea route for trade between the southwestern region and ASEAN.
In inland provinces such as Jiangxi, Hunan, Henan, Hubei, and Anhui, there is a quiet wave of canal construction projects receiving investments in the billions.
In Jiangxi, a plan to invest 320 billion yuan is underway to build the Zhejiang-Guangxi-Yue Canal, stretching approximately 1,988 kilometers, even longer than the Beijing-Hangzhou Grand Canal.
Hunan plans to invest 150 billion yuan to construct the Xiang-Gui Canal, connecting the Yangtze River and the Pearl River systems.
Henan plans to invest 141.6 billion yuan in the construction of 47 inland water transport projects, aiming to create an “internationally competitive inland water transport industry cluster.”
Hubei plans to invest 78.4 billion yuan to build the Jinghan Canal, with the goal of improving shipping efficiency on the Yangtze River.
Anhui has been the fastest to act, investing over 90 billion yuan in the construction of the Jianghuai Diversion Project, which commenced in 2016. One of its components, the Jianghuai Canal, was completed and opened for navigation in 2023.
Reportedly, the total investment in canal projects in these six provinces amounts to around 850 billion yuan, exceeding the Gross Domestic Product (GDP) for Liaoning Province in 2023, which stood at 812.2 billion yuan.
This canal excavation frenzy is not a spontaneous initiative by local governments. Back in 2020, the CCP’s Ministry of Transport issued the “Outline for the Development of Inland Water Transport,” proposing to “open up a major North-South cross-basin water transport corridor and construct a new Grand Canal,” coordinating projects like the Pinglu Canal among others. In 2021, the State Council issued the “Outline Plan for the National Comprehensive Intermodal Transport Network,” incorporating the Pinglu Canal project into the 14th Five-Year Plan and the long-term vision for 2035.
Water resource expert Wang Weiluo, interviewed by Epoch Times, remarked that the recent canal projects in China stem from Xi Jinping’s water control ideology akin to Mao Zedong’s Great Leap Forward era, believing that the Party can command water and control it. “China’s grand canal planning clearly embodies the Chinese Communist Party, fully embracing Soviet or Stalinist thinking, aiming to conquer nature and beat the heavens,” he said.
However, Wang Weiluo argued that the CCP’s approach is anti-science and anti-nature, making these canal projects essentially “contrary to nature.” “Water flows from high to low, the water in China mainly flows from the west to the east, but now many canals are going wherever they please. The CCP wants to control all the water,” he added.
He further mentioned that Guangxi has been facing numerous floods and disasters in 2024 due to the excavation of new canals, disrupting the water system in Guangxi and potentially leading to even greater calamities in the future.
“The nationwide excavation of canals causes significant ecological damage, disrupting natural river and lake systems, leading to more frequent floods and droughts,” he explained. He pointed out the South-to-North Water Diversion Project, especially the Middle Route Project from Danjiangkou to Beijing. It should pass through about 800 natural rivers along the way, but for cost-saving purposes, only about 200 natural rivers remain intact; the rest have been cut off, with some even developed into cities. As a result, several hundred rivers have disappeared, and during floods, these rivers may reappear since they originally served as water pathways. The sudden emergence of water in many residential areas, towns, and cities can be attributed to this change.
The CCP’s official media defends the rationale behind canal excavation, often citing the successful Beijing-Hangzhou Grand Canal that has been servicing numerous vessels throughout the year.
According to Wang Weiluo, the ancient Beijing-Hangzhou Grand Canal was not an “against the heavens” project since it mainly connected Hangzhou to northern Jiangsu and then turned towards Luoyang from Suzhou, facilitating the transportation of goods from the south through natural waterways, primarily active in the Jiangnan region at that time.
“To this day, the Beijing-Hangzhou Grand Canal has the highest traffic volume from Hangzhou to Zhenjiang in Jiangsu, and then from Zhenjiang to northern Jiangsu, as the focus of China’s economic development lies in the Yangtze River Delta region. However, this segment of the Grand Canal is one of the most severely polluted stretches among China’s rivers,” he added.
Chinese issues expert Wang He also expressed to Epoch Times that ancient China valued following nature’s course when digging canals, with caution exercised. However, the CCP today fights against nature, altering landscapes recklessly. Historically, such endeavors have led to more harm than good, severely damaging China’s ecological environment. Projects like the Three Gorges Dam and the South-North Water Diversion have brought significant disasters to the Chinese people. Hence, pushing for further canal excavations now is bound to spark strong discontent nationally and locally.
Regarding canal excavation, officials emphasize not so much the role of water conservancy but rather the importance of transportation layout and economic development. State media laud these initiatives as promoting the so-called high-quality development of the Chinese economy, representing cultural symbols of the new era, but fail to address the financial struggles faced by various regions in China.
On September 7, mainland China’s Sohu Sige Working Studio published an article entitled “What is the Meaning of a Canal Costing 5 Billion Yuan per Kilometer, More Expensive than High-speed Rail,” pointing out that the massive investment poses an even more challenging issue.
Bestselling author Song Hongbing also questioned in late August where the funding for China’s canal mega infrastructure projects is coming from.
The article mentioned that while the national government financed the construction of high-speed railways, the focus has shifted towards local autonomous construction, as is the case with canals. For example, the already completed Jianghuai Canal received more than 20 billion yuan in central government funding, while Anhui province and municipalities collectively raised over 40 billion yuan, besides securing an additional loan of more than 20 billion yuan from policy banks.
The article also noted that the plan for the Jianghuai Canal, which commenced in 2016 when local governments had surplus funds, faces delays after several years. However, with local governments across inland provinces even relying on fiscal transfers from eastern provinces for years and struggling this year, some regions are facing difficulties, some even failing to pay salaries, highlighting the challenge of raising funds to sustain these “super projects.” On the national level, with a 6.4% year-on-year decline in general public budget revenue, which stood at 5.9745 trillion yuan for the first seven months of the year, the situation is far from ideal.
Wang Weiluo pointed out that whether it’s the planning of high-speed railways, expressways, or canals, they all fall under the jurisdiction of the Ministry of Transport, headed by Li Xiaopeng, the son of former Premier Li Peng. Li Xiaopeng’s major achievement since taking over as Minister of Transport from Shanxi Provincial Party Secretary in 2016 has been investing, investing, and then reinvesting. The result has been losses in high-speed railways, losses in expressways, and the anticipation of losses in canals as well.
Analyzing the situation, Wang Weiluo explained that despite financial difficulties and arguments against these projects, local governments remain highly motivated. Once the project funds are allocated, local authorities prioritize diverting funds to pay civil servant salaries, aiming to resolve local fiscal crises. Moreover, corrupt practices in large-scale infrastructure projects could range up to a third of the funds, with even higher corruption rates in water-related projects.
Emphasizing that the central authorities’ large-scale transportation and canal excavations planning occurred in 2020 and 2021, in the face of economic downturn, in 2023 and 2024, authorities rolled out two documents, aiming to strictly control large-scale infrastructure projects. On September 1, 2024, the CCP’s Ministry of Finance, Ministry of Housing and Urban-Rural Development, and four other departments jointly released the “Urban Basic Infrastructure Asset Management Measures (Trial),” officially stating the absolute prohibition of illegal and irregular borrowing for public infrastructure assets with no or little income, decisively prohibiting the addition of hidden debts.
Earlier, in 2023, the State Council’s document “Classified Strengthening of Government Investment Project Management Measures (Trial)” mandated that 12 key provinces, including Guangxi, temporarily suspend new government investment projects in 2024.
In fact, the elaborate plan to construct the Zhejiang-Guangxi-Yue Canal in Jiangxi has faced delays for years, having been conceived shortly after the CCP took power. In 2010, the proposed Zhejiang-Guangxi-Yue Canal was planned to connect the Pearl River with various northern water systems, but controversies arose due to ecological risks. A website in Jiangxi conducted a public opinion survey on the pros and cons of initiating the construction of the Zhejiang-Guangxi-Yue Canal, where 48.71% of netizens believed that “building the grand canal would bring more harm than good to Jiangxi,” whereas only 29.03% thought that “building the grand canal would benefit Jiangxi more than harm it.”
After the CCP authorities announced the slogan of building a “new Grand Canal” in 2020, plans for the Zhejiang-Guangxi-Yue Canal resurfaced, fueling continuous controversies.
Wang He noted that even though various regions have proposed digging numerous canals, only two, namely the Pinglu Canal in Guangxi and the Jianghuai Canal, have received official approval to commence work. The rest of the canal projects are still in the planning phase. The central government in Beijing has not approved them, indicating extensive debates. One reason for the delay is the current debt crisis in local regions.
“With the central government’s financial difficulties and strapped local finances, where would the massive funds for these canal projects come from? Although the CCP is pushing for major infrastructure developments to maintain economic growth at 5%, its approach through infrastructure projects brings endless troubles and unimaginable ecological damages. At present, the CCP is struggling, and not all of these projects might commence soon,” he concluded.
Wang He pointed out that amidst China’s overall economic turmoil, although local governments and central ministries hope to start these projects to secure revenue, strong opposition and unfavorable economic conditions restrain their impulses. Hence, the current situation is at a standstill. Initiating these canal projects forcefully could worsen the economic situation, causing these projects to eventually stall without completion.
Wang Weiluo pointed out the example of Emperor Yang of the Sui Dynasty who launched canal projects, leading to a fiscal crisis, and ultimately, the downfall of the dynasty. Similarly, after the CCP’s extensive endeavors in the era of “against nature projects,” a similar fate is likely to unfold.