In 2013, the Chinese Government under the leadership of President Xi Jinping launched a series of infrastructure investments and diplomatic endeavors known as China's Belt and Road Initiative (BRI). With over 3,485 projects across 138 countries and over 273.6 billion USD in official Chinese financing, the size of the BRI is unprecedented. The BRI seeks to stimulate economic growth through connective infrastructure built by China, with the support of the recipient country. It assumes that these projects will have positive spillover effects for nearby sectors while attracting more investment. The BRI is heavily concentrated in the Afro-Eurasia geographic regions and has, in recent years, expanded to Latin America and the Caribbean. As of 2020, nineteen countries in Latin America & the Caribbean have signed BRI agreements. Many critics have questioned the relative success of BRI projects, focusing on unintended consequences, such as the impact on the environment and indigenous populations, and the quality of implementation.

Chinese investment in renewable energy through the BRI could help to improve energy security and transform energy sectors to favor low-carbon emitting sources in recipient countries. However, a significant portion of BRI energy projects is fossil-fuel-based. And of the non-fossil fuel energy projects China is financing in South America, many are hydroelectric power projects, which carry their own environmental consequences.

In June 2018, the Chinese and Bolivian governments signed a Memorandum of Understanding (MoU) stating that Bolivia would join the BRI. In the years leading up to and subsequent to the establishment of the MoU, China's investments in Bolivia have continued to grow. These investments have largely been concentrated in the hydropower sector. Former President Evo Morales believed that the exportation of surplus energy from HPPs would provide a stable solution to Bolivia's energy and economic issues and, as a result, concentrated Chinese investment in the hydropower sector. Bolivia's geography of both the Andes Mountains and Amazon Rainforest lends itself well to the construction of hydroelectric power projects. By partnering with the Chinese, Morales put these HPPs at the center of Bolivia's national development strategy. This could not have been accomplished without Chinese state-owned enterprises (SOEs) providing financing and technical knowledge on hydropower development.

In 2011, the installed capacity connected to Bolivia's National Grid System (SIN) was 1.31 gigawatts (GW). While electricity generation has increased since then, it remains largely dependent on natural gas, rather than renewable sources. Over the past decade, the demand for electricity in Bolivia has skyrocketed and has led to a series of outages and unsatisfied demands.

There are currently six proposed hydroelectric power projects (HPP) in Bolivia. Of the six, only two have been completed--the San Jose I HPP in 2018 and the San Jose II in June 2019--and are both now producing energy to the national grid. Larger projects, such as the Ivirizu and the Rositas HPPs, are still under construction due to delays caused in part by mobilized opposition against the projects, as detailed in the report and in the scorecard. The Chepete-El Bala Dam and HPP Complex were supposed to start construction in 2019, along with 13 other infrastructure projects which were all announced in 2015. Satellite imagery shows that construction of the HPP has yet to start as of January 2021.

Lessons to take away from project outcomes:

• The hydropower industry continues to face an interconnected web of challenges and opportunities that are continually evolving.
• Hydroelectric power projects have the potential to revitalize local communities by providing jobs and stimulating economic activity.
• Many hydroelectric power projects contracted by China's SOEs have ignored environmental impact assessments. These projects have negative impacts on the surrounding environment, including deforestation and loss of biodiversity.
• Consultations of proposed infrastructure projects with local peoples are required under international and Bolivian law. However, a number of proposed hydroelectric power projects have not been approved or even shown to local populations. Without proper consultation, thousands of Bolivians will be displaced and their lands could be inundated. This has caused numerous indigenous-led protests against the construction of these projects.

Methodology

In this article, and the case study on hydropower in Ecuador which will be released in the near future, each BRI project was analyzed in the context of the environment, community impact, and legal indicators. These three indicators were then broken down into relevant success factors. For each success factor, each project was ranked as unsuccessful (0), neutral (1), or successful (2). To rate the overall impact of the dams, the scores for each dam were averaged out, creating a scaled ranking of unsuccessful (0 - 0.68), neutral (0.69 - 1.34), and successful (1.35 - 2). For more information on the specific rankings for each project and success factors, see the scorecard of hydro project factors. Also, download our BRI threshold matrix to see what factors we used to classify projects as BRI or not. 

The Bolivian Context

Former Bolivian President Evo Morales entered office in 2006 as Bolivia's first indigenous president, a group that makes up 41% of the nation's population over the age of 15, according to the 2012 census. Morales' platform, while primarily focused on indigenous rights, included the 2025 Patriotic Agenda, which outlined, among other objectives, Bolivia's transformation into a regional energy hub through the generation of 3,000 megawatts (MW) of hydroelectric energy for domestic use and exportation. To accomplish this ambitious goal, Morales commissioned a series of hydroelectric power projects, many of which were to be built or funded through China's Belt and Road Initiative (BRI). While two of the six BRI-associated projects have been completed, most are at a standstill, falling short of public declarations.

Morales envisioned Bolivia becoming the "energy heart of Latin America," and saw hydroelectric power as the means by which to achieve this. This is in part due to the country's geography, home to the elevated Andean mountains and the Amazon rainforest, a landscape that contains a large potential for hydropower production. In order to achieve this, Bolivia needed financial backing, which would come from Chinese BRI investments. While the hydroelectric power projects are meant to expand Bolivia's clean energy supply, the projects have had damaging consequences, including the displacement of indigenous peoples and destruction of the wildlife and biodiversity, countering Morales' platform championing indigenous rights.

In 2019, Evo Morales ran for and won an unprecedented fourth term. Unlike Morales' previous re-elections (that were still beyond the two-term limit previously enshrined in the constitution), his run in 2019 was marked by a low degree of support by Bolivian citizens leading up to the vote. Instead, his refusal to accept term limits backed by a majority of Bolivians strengthened opposition and led to a series of protests against his candidacy. The Bolivian public's ability to quickly organize a mass mobilization became apparent in the series of protests, in which at least 36 people died and many more were injured, that occurred following Morales' victory claim. The protests successfully forced Morales to resign as multiple foreign entities, including the Organization of American States (OAS), published claims of electoral fraud. In October 2020, Luis Arce was elected with a landslide majority of votes in a closely monitored presidential election. ¹

Luis Arce has made it clear that his government will work closely with Xi Jinping's government to cultivate the relationship between Bolivia and China, claiming that the nations' friendship is "unbreakable." Prior to becoming Bolivia's President, Arce promoted economic development through foreign investment, mostly from China, as the Minister of the Economy and Finance under Morales. However, this came at the expense of Indigenous Peoples' rights and preservation of ecosystems and biodiversity, as several planned hydroelectric power projects and dams were visualized to be constructed in protected areas and the Amazon. Despite these negative factors, the political relationship between Bolivia and China remains strong. Since Arce assumed office, China has supported Bolivia in more humanitarian ways by aiding in COVID-19 vaccination distributions, suggesting that the relationship between the two nations goes beyond the BRI investments in renewable energy infrastructure.

Completed Hydroelectric Power Projects: San Jose I & II Hydroelectric Power Plants (HPPs)

Located on the eastern slopes of Bolivia's Andes Mountains in the Cochabamba Department, outside Carrasco National Park, the San Jose I and II HPPs provide energy to Bolivia and beyond. The San Jose I and II HPPs aim to meet the nation's growing energy demand and increase reliability and security of future power supply. This joint project was constructed by the Chinese state-owned Sinohydro Corporation and the Bolivian state-owned Empresa Nacional de Electricidad [National Electric Company, (ENDE)]. The Morales administration worked closely and relied heavily on BRI financed infrastructure projects, such as the San Jose I and II HPPs, to complete Bolivia's 2025 Patriotic Agenda, which included achieving energy independence and becoming an energy exporter to Bolivia's neighbors--Argentina, Brazil, Chile, and Peru--through the National Interconnected System (SIN).

The SIN connects major urban areas in seven of Bolivia's nine departments, the equivalent of states in the US, accounting for 84% of the national demand for electricity. The Morales Administration strived for the rational and efficient use of natural resources to expand and improve their national energy matrix. The San Jose I and II HPPs were connected to Bolivia's national grid system in January 2018 and June 2019, respectively, which is verified by the below August 2018 and August 2019 imagery. However, it is unclear how much of the energy produced at the San Jose I and II HPPs will be exported.

Many Chinese state-owned enterprises (SOEs) struggle to meet the standards and safeguards their host country requires for projects, such as HPPs. In many cases, these companies fail to provide an accurate environmental impact study, or none at all. For instance, in Ecuador, Sinohydro never completed a geological examination for the infamous Coca Codo Sinclair Dam and HPP complex, leading to the dam being constructed on a fault line. The lack of due diligence is concerning for other governments and businesses who have contracted Sinohydro. For San Jose I and II HPPs, the environmental and community development failings, as reflected in our indicators, demonstrate Sinohydro's relative ignorance of the local context and needs.

The San Jose I and II HPPs have both positive and negative impacts in the field of community development, with an overall neutral rating. Regarding positive impacts, the projects combined provide 124 MW of electricity, which has improved the quality of life for over 700,000 Bolivians in the Cochabamba Department through the introduction of reliable electricity. Additionally, Sinohydro relied on local labor to construct the two HPPs, providing over 1,000 new construction jobs for local and indigenous communities. These new jobs have provided much needed economic wealth for workers and for the local Bolivian economy. Regarding negative impacts, there is no record of other economic or social development benefits to the local communities. Further, construction was stopped at both HPPs in January 2016 by a worker's strike at the construction site. Approximately half of the Bolivian laborers, around 500 people, were demanding the compliance of Bolivian and international labor laws, and the end of discrimination towards the Bolivian laborers by the Chinese laborers. Anonymous testimonies discussed the lack of industrial safety, workers' dormitories that were falling apart, lack of food, and abuse of employment contracts. Many signs at one of the protests read, "Basta de discrimacion, esto es Bolivia no China" [Enough discrimination, this is Bolivia not China], referring to how Bolivian workers must be treated with respect and Bolivian labor laws must be followed. The strike lasted less than a week and was resolved by Sinohydro signing 14 agreements to improve conditions. Due to a lack of data, it is unclear whether Sinohydro followed through on these agreements. It is important to note that Sinohydro's mistreatment of workers and poor safety conditions has occurred at construction projects across the world, including at Ecuador's Coca Codo Sinclair Dam and HPP complex. The events at San Jose I and II are not abnormalities.

According to the Development Bank of Latin America, the San Jose HPPs saved 7.81 billion cubic feet of gas, exponentially reducing CO2 emissions in the surrounding region. However, the environmental impact of the San Jose HPPs extends beyond simply reducing CO2 emissions. Per our scorecard, despite the large reduction of CO2 emissions, the projects are unsuccessful in the land and biodiversity environment indicators. Both San Jose I and II HPPs are located close to Carrasco National Park, one of Bolivia's most biologically diverse parks. Both facilities saw large amounts of deforestation near valuable water sources, which has the potential to destroy ecosystems. As visible in the comparison of the 2013 satellite imagery to later images of both HPPs, visible deforestation exists even beyond the areas where the main facilities are located.

The environmental impacts of large infrastructure projects, including deforestation, will be exacerbated by the additional infrastructure that is needed to support these facilities and connect them to the national grid. For the San Jose I HPP, not only was land cleared for the powerhouse, reservoir, and access roads, but additional land was cleared for storage facilities to house materials during construction (August 2018 image) and the SIN's transformer and transmission lines (August 2019 image).

San Jose I imagery

San Jose II imagery

Construction Delayed: Rositas Hydroelectric Power Plant (HPP)

Located in the Santa Cruz Department of Bolivia, the Rositas Hydroelectric Project Complex is expected to generate between 500 and 600 MW of energy once completed. Funded by the Export-Import Bank of China, the dam is projected to cost between $1 to 1.5 billion USD. The Rositas HPP has a long history. The project was originally proposed in 1987 and has been reconsidered multiple times. The project was expected to begin energy generation in 2024; however, this goal is presently unrealistic given the current state of the HPP shown by satellite imagery as well as the backlash it has provoked. In terms of the construction timeline and all of our indicators, the Rositas HPP project is decidedly unsuccessful.

In 2016, the Bolivian government awarded the construction contract for Rositas project to the Accidental Rositas Consortium Association [Asociacion Accidental Rositas Consortium, (AARC)], which is composed of the Chinese SOE China Three Gorges Corporation, its subsidiary China International Water and Electric Corporation, and the Bolivian construction company, Reedco SRL. The Bolivian national power company, ENDE, will oversee AARC's construction of the Rositas HPP. It is unclear when construction will resume due to the mobilization of indigenous and human rights groups against the dam, and former President Evo Morales briefly suspending the project.

Per our community development indicators, the Rositas project will have a resounding negative impact on local communities and their livelihoods. The Rositas project will span 452 km² traversing five municipalities. Within this impacted area, large flooding areas will displace twelve different indigenous communities, one of which is visible in December 2019 imagery, encompassing thousands of people. This flooding area will eradicate much of the communities' critical infrastructure, including schools, roads, power lines, and a crucial bridge over the local Rio Grande. However, the HPP would irrigate 164,000 hectares of agricultural land, supply drinking water to Santa Cruz, and reduce the risk of flooding downstream. Yet, it is unclear if any of these benefits will be visible and accessible to the directly impacted indigenous communities.

Impacted indigenous communities claim that there have been no informed consultations regarding the project by the Bolivian government or the AARC. The right to informed consultations and the voicing of consent prior to the installation of impactful infrastructure projects is required by the International Labour Organization's Convention 169 on Indigenous Peoples and the 2009 Bolivian Constitution. Since the 1970s, indigenous resistance has been one of the primary reasons for the lack of construction progress at Rositas project. Grassroots mobilized resistance has only grown and become more formalized since then. In 2018, the Guarani communities of Tatarenda Nuevo and Yumao sued ENDE for violating their rights. The case was controversial, and included human rights defender Nelson La Madrid receiving threatening messages and attempted police detainment. After taking their case through three separate courts, the communities' petition was ruled as inadmissible.²

Protests by indigenous communities have been compounded by backlash regarding the environmental impacts of the Rositas project. The project is located in three protected areas: the National Park and Integrated Management Area Serrania del Inao [Parque Nacional y Area de Manejo Integrado Serrania del Inao], the Integrated Management Area Rio Grande-Valles Crucenos [Area de Manejo Integrado Rio Grande-Valles Crucenos], and the Parabano Municipal Protected Area [Area Protegida Municipal Parabano], which together house nearly 2,500 species of plants and 570 species of animals. The deforestation caused by the project--the potential of which is visible in the 2019 imagery--removes part of the carbon sink, and consequently, increases CO2 emissions by approximately 70 million tons (due to the lack of trees absorbing CO2). The flooding discussed in the previous paragraph, which displaces twelve indigenous communities, will also impact the habitats of thousands of species, some of which are endangered. The changed river flow could impact the quantity of water and sediment load transported downstream, both of which impact those communities that rely on the water for sustenance and agriculture. Some environmental opposition groups to the dam cite Bolivian Law 2727, which protects the Serrania del Inao region. Others claim that the river's high sediment loads would fill the reservoir with dirt within 30 years, a commentary on the long-term functionality of the dam.

Indigenous women in the community of Yumao have organized yearly demonstrations against the construction of the Rositas dam, bringing awareness to the detrimental impacts of the hydroelectric project on biodiversity and indigenous rights. As of December 2019, the construction of the Rositas complex was being "reconsidered" by former interim-President Jeanine Anez. It is unclear what the final consideration verdict was, largely due to continued political turmoil and the beginning of the COVID-19 pandemic in the months following the December 2019 announcement. But if groups, like the Yumao women, continue to protest, what activists call the "dam of death" may never resume construction.

Construction Delayed: Ivirizu Dam and HPP Complex

In 2017, Sinohydro, a Chinese state-owned hydropower engineering and construction company, was awarded the opportunity to lead the construction of the Ivirizu hydroelectric power complex in the Pocona municipality on the Ivirizu River, in the Bolivian Carrasco National Park. Sinohydro committed to investing $550 million USD over four years for the construction of the dam. The Bolivian hydropower company, ENDE Valle Hermoso, would assist Sinohydro with the construction, while the Central Bolivian Bank would finance the project. The Ivirizu hydroelectric power project was a part of Evo Morales' 2016-2020 National Economic and Social Development Plan and is estimated to be completed in 2021. The dam and the HPP complex will consist of two power plants--Sehuencas and Juntas--which will jointly provide 280MW of energy to the national grid, helping Bolivia achieve its long-term goal of increasing the domestic supply of hydropower while bolstering Bolivia's status as an energy exporter.

In October 2020, construction of the diversion channel at the project was completed. As of March 2021, construction is still ongoing for the rest of the project. Since September 2019, there have been active signs of construction as identified via satellite imagery. Additionally, recently, Indar, a Spanish construction company, has been contracted to provide generators for the two HPPs. Sinohydro hopes to widen and develop roads that will lead directly to the Ivirizu dam and HPP Complex. Based on the imagery and on-the-ground sources, evidence of preliminary construction and movement of materials is visible, suggesting that Sinohydro's project is moving forward. The June 2019 satellite image below depicts several signs of construction, including: a bridge for transporting materials, supporting infrastructure to house materials, land clearing for the main water reservoir, and road construction.

Beyond the slow pace of construction, Ivirizu is expected to have a relatively negative impact on the environment, which has been largely ignored by the Bolivian government. The impact of construction is evident in the deforestation and rerouting of the Ivirizu river, as visible in the annotated satellite imagery shown below. Approximately 1,235 acres of land would have to be cleared within the protected forest area for the construction of the project, taking a tremendous toll on the park's rich biodiversity. However, the mayor of Pocona, Juan Carlos Rodriguez, has assured the media that the hundreds of different species of flora and fauna would not be greatly affected by the construction of the dam due to regulations put in place. ENDE Valle Hermoso has also made efforts to rescue, preserve, and return species to the park. ENDE ambitiously stated that for every hectare of land that is deforested, they will plant double the amount of trees. While ENDE Valle Hermoso and Mayor Rodriguez have stated that the Ivirizu dam will not have significant environmental impacts, its construction in the untouched Carrasco National Park still suggests otherwise. Regarding community development success factors, there are notable positives including the improvement and development of roads and the generation of employment opportunities for 3,000 people, 80% of whom are Bolivian--not Chinese--laborers.

The majority of the analyzed sources were published between 2017 and 2019, suggesting that there is limited data and information about the Ivirizu project's progress. The lack of reporting on construction updates could be, in part, due to the turbulent presidential transition from Evo Morales to Luis Arce and the COVID-19 pandemic, both of which could have put the Ivirizu project on pause since late 2019. Another potential barrier could be the lack of accessible indigenous sources, due to the remoteness of the impacted communities.

Construction Postponed: Chepete-El Bala Dam and HPP Complex

The Chepete-El Bala Dam and HPP Complex is being constructed on the Beni River in the Amazon region of Bolivia. The project is proposed to be completed over the next 10-15 years with a combined energy generation capacity of 3700MW. However the construction, which was supposed to begin in 2019, has been indefinitely postponed due to major backlash over the project's negative impact on the local communities and environment. In 2015, China and Bolivia signed an official agreement for China to construct 13 infrastructure projects, including the Chepete-El Bala Complex. While specifics for who is funding and implementing this project, including the specific companies involved, has yet to be announced, the project is clearly part of the official 2015 agreement between the Chinese and Bolivian governments.

According to an article from the World Politics Review, Bolivia inherited the debt and assumed the risk for most Chinese-financed infrastructure projects. A majority of these projects are contracted out to Chinese companies through turnkey contracts, which "place [China] in charge of both design and construction, bringing their own materials, equipment, technology, and often their own labor." With turnkey contracts, Bolivian government oversight and involvement with the project shrinks dramatically. While the type of contract for the Chepete-El Bala Complex is unknown, the lack of transparency and government oversight has caused outrage among environmentalists and local communities. In our indicators, Chepete-El Bala Complex scored low in the legal indicators because of this contract and protests against the project.

The low legal indicators for the project are complemented by an even lower environmental rating. The Chepete-El Bala Complex intersects with the Madidi National Park [Parque Nacional Madidi] and Pilon Lajas Biosphere Reserve and Communal Lands [Reserva de la Biosfera y Tierra Comunitaria de Origen Pilon Lajas], which together are one of the most biologically diverse and well-preserved areas of the Amazon rainforest. There is risk of soil degradation, disappearance of river-side beaches, and changes in fish migration and reproduction. Between 200-600+ species live in the park and their habitats would be altered by the potential floodplain, as outlined in the December 2020 imagery. This floodplain could hold water in a space covering almost 680 square kilometers and up to 200 meters deep, this potential reservoir is visible in the below imagery. This de-facto swamp would emit large amounts of greenhouse gases and toxic methane gas. There is an expectation of large levels of deforestation from road construction, transmission lines, and water reservoirs. Finally, the complex is located in a geologically unstable area that is prone to intense rainfalls and landslides, all of which could cause the dam to fail.

For the people who call this area home, this is not just an environmental issue. The local interdependence with the natural environment reveals the socio-economic impacts on local communities. As previously discussed, Bolivian law, along with International law, guarantees indigenous groups an open consultation when an infrastructure project is proposed in their area. If constructed, the inundations would displace 4,000 local inhabitants, including those citizens of the communities Rurrenabaque and San Buenaventura, and other communities visible in the June 2018 image. Neither the Bolivian Government nor Chinese contractors have offered a clear plan for resettlement or any sort of compensation for these lost lands.

In response to the potential construction, the advocacy group the Coordinator for the Defense of the Amazon [La Coordinadora para la Defensa de la Amazonia] was founded to represent those indigenous peoples most affected by the construction of the Chepete-El Bala Complex. Due to the organizing efforts of this group, a number of protests against the construction have occurred, including one in November 2016 that blocked GeoData, an Italian firm working with the Bolivian government to study the viability of the dams, access to the construction site. The protest was ultimately successful as GeoData withdrew their engineers and equipment, citing a lack of community consensus for the dam as their reasoning.

Conclusion

Our analysis shows that the implementation and relative success of the BRI in Bolivia is dependent on SOEs mitigating local community concerns and tempering rushed political declarations with measured action. Each of these six projects scored poorly on environmental indicators, demonstrating the SOEs' haste to construct the projects and disregard of the potential environmental impacts. This could have been amplified by the domestic political situation in Bolivia. While in office, Morales was struggling to meet his widely publicized overarching goals on energy. The public pressure for the success of the 2025 Patriotic Agenda incentivized the Morales administration to quickly enter into infrastructure development contracts, even if those contracts disadvantaged the role of Bolivian stakeholders, as turnkey contracts have the possibility of doing.

However, the majority of interactions with BRI actors occurred at the local level, not between government actors. This is potentially due to the national-level political turmoil in Bolivia. Resistance was led by local communities and activists on the grounds of negative impacts on local indigenous communities and the environment. Grassroots mobilization delayed four out of the six projects. It is unclear whether these projects will resume construction or when construction will be completed.

Notes

1. Hours after polls closed in Bolivia's controversial October 2019 election, Morales claimed outright victory, without the official posting of results. After 24 hours of no results, Morales was officially announced winner with 47.08% of votes just above the 10% requirement as his closest opponent won only 36.51% of votes. The mass protests and lack of transparency around the electoral process caused the Organization of American States (OAS) to investigate. OAS's preliminary report questioned the reliability of the results and recommended another electoral process to be held in order to guarantee the electoral integrity of the results. Originally, Morales claimed the government would hold another full election to certify the results; however, he and his VP Garcia Linera resigned after the request of multiple influential bodies. Following their official resignations, 2nd Vice President of the Senate Jeanine Anez was appointed as interim president.

Anez was originally to serve as interim president only until an election was held within 90 days. However, due to the COVID-19 pandemic, the election had to be postponed multiple times and Anez was in power for almost a year until October 2020. Her presidency was marked by claims of corruption and mismanagement of the COVID-19 pandemic that left Bolivia with one of the world's worst per-capita death rates from the virus. After almost a full year of uncertainty, in October 2020, a monitored presidential election was held. Luis Arce, a member of Morales' Movement Toward Socialism Party and the controversial former president's Economy and Finance minister for almost 12 years, was elected with a landslide majority of votes. Arce's close ties to the former leader sparked suspicions among Morales' opponents, but Arce claims that there will be no role for Morales in this administration.

The judge ruling over their case claimed: "the plaintiffs cannot be considered affected when there are no regulations, or an active project, nor can they claim to be affected until studies are concluded that must be carried out by ENDE prior to the consultation." The communities responded that the courts did not consider documents demonstrating how they would be impacted by the flooding and displacement.