Dam-induced development and environmental and social sustainability: the Bakun industrialization strategy revisited.

Author:Keong, Choy Yee

Malaysia changed rapidly from an agriculturally based economy in the 1960s to an industrially oriented nation in the 1990s. Its rapid industrial development momentum is further intensified under the Malaysian Third Outline Perspective Plan (OPP3) 2001-2010 a long-term development plan which aims to develop Malaysia into a fully industrialized country by 2020 (EPU 2001a). This long-term vision of growth is often known as "Vision 2020." Unmistakably, one of the main conditions for achieving this vision of growth is the increasing availability of energy, particularly the supply of electricity to spur its industrialization process. As claimed by the Ministry of Resource and Planning, for instance, "[w]ith industrialization as our national vision, we must have sufficient energy to realize our plans" (Sarawak Forest Department, undated). It is in this setting that the government has ventured into developing one of the largest dams in the world the Bakun Dam.

The dam, which will cost about $2.5 billion, is in the state of Sarawak in Malaysia (see figure 1). It has an installed capacity of 2,400 megawatts (MW) and a life cycle between thirty and fifty years. The dam measures 205 meters (m) high, 740 m long, and 560 m wide. It is the largest dam in Southeast Asia. The impoundment of water behind the dam will completely submerge 69,640 hectares of tropical forest ecosystem an area larger than the size of Singapore. The project also requires a forced displacement of the entire indigenous population, consisting of some 10,000 inhabitants who have been living in the Bakun interior for 450 years.


Although the dam-induced industrialization policy (called here the Bakun strategy) represents an aggressive strategy to spur Sarawak's economy to a higher stage of development, notes of concern have often been sounded over its inability to take into consideration the biophysical constraints governing its growth process. (1) It is also contended that the strategy has failed to consider the social impacts and external environmental effects arising from its compositional shift toward the development of energy- and pollution-intensive industries. Motivated by these concerns, this article seeks to analyze the dynamic implications of the links between the growth process and environmental/ social sustainability in order to assess to what extent the Bakun strategy represents a sustainable mode of development. This article is also written with the view of providing a fruitful source of comparative insights into the management of socio-economic and environment relations. By drawing inferences from the World Bank Industrial Pollution Projection System (IPPS) pertaining to the relationships between sectoral composition of industries and industrial pollution, it illustrates the existing constraints and real potential in achieving development which is socially and environmentally sustainable.

Environmental sustainability as used here refers to two dimensions of sustainability: ecological sustainability and environmental quality. Ecological sustainability relates specifically to the resilience of an ecosystem. Resilience is defined as the ability of an ecosystem to absorb or adapt to shocks and stresses when disturbed and to reconfigure itself without significant decline in its crucial functions in relation to the social and ecological systems (Holling 1973, 1978). It is an index of the "integrity" or "health" of an ecosystem (Perrings 1997, xviii). Basically, Crawford Holling's sustainability requires natural resources to be exploited in such a way that it does not disturb the resilience of a system as a whole. It recognizes that extinction of some species is permitted so long as the ecosystem when disturbed is able retain its organizational structure or resilient feature. It also places great emphasis on protecting critical natural capitals from stress and shock, which, if left unchecked, would result in the loss of ability of the ecological system to function efficiently. Critical natural capitals refer to natural assets providing essential ecological or life-support functions. Consequently, protecting the resilience of these capitals is important in any strategy of sustainable development (Perrings 1997, xix).

Insofar as environmental quality is concerned, it is associated with the external environmental effects arising from the promotion of pollution-intensive industries under the Bakun policy, which may affect the capacity of the biosphere to provide essential environmental substances such as clean air and water. Social sustainability in the present context refers to development that promotes social interaction, cultural enrichment, and equal opportunities for access to resources, including clean air and water as well as income flows (see below). Particularly, from the Bakun indigenous communities' perspective, it concerns safeguarding the right of the local inhabitants to gain access to Bakun natural resources. It is noteworthy that the right to access to land and forest is of paramount importance in sustaining the socio-economic existence and cultural identity of indigenous people in the Bakun region (see, for example, Hong 1987; IDEAL 1999; Choy 2003, 2004a, and 2004b).

Sarawak's Industrial Policy

The Raison d'Etre

Sarawak's economy depends heavily on the export of primary commodities, especially liquefied natural gas (LNG), crude petroleum, and timber. For instance, in 2002 LNG contributed 36 percent, or $2.6 billion, of Sarawak's total export amounting to $7.2 billion. This is followed by crude petroleum, $1.6 billion (36 percent); timber products, $1.4 billion (19 percent); other wood-based products (including plywood, sawn timbers, and sawn logs), $1.28 billion (18 percent); and palm oil, $247 million (3 percent) (STA 2003). However, in an attempt to draw Sarawak toward achieving "Vision 2020," the government sees the need to diversify and transform its economy into an advanced industrial state instead of relying too heavily on the export of primary products. It is under this shift of development priority that the government undertakes to construct the Bakun Dam in order to provide a sustainable and cheap source of electricity to support its industrial expansion program. As asserted by former Malaysian Prime Minister Mahathir Mohamed, for instance: "Bakun will not only provide the cheapest source of energy but will also serve as a catalyst to the country's industrialization program" (Gabungan 1999).

The project is also embraced by the government as a magnetic force to attract foreign direct investment in energy-intensive industries such as pulp and paper, petrochemical, aluminum smelting, and steel. In fact, the Sarawak state government has agreed with a Dubai-based company to develop a $2 billion aluminum smelter plant ("Smelter Asia") in the Similanjau industrial zone in Bintulu to take advantage of the Bakun power (Malaysiakini 2003; SAM). The aluminum plant is expected to produce 500,000 tons of aluminum annually (Business Times 2003).

Economic Modernization vis-a-vis Socio-Environmental Degradation

While the Bakun strategy is aggressive in its effort to draw Sarawak closer to achieving its Vision 2020, its actual contribution to development is not without question. In its attempt to optimize the use of Bakun electricity through the promotion of energy-intensive industries, it has, at the same time, generated a host of environmental disturbances and social repercussions. Basically, these environmental and social disruptions unfold themselves in two forms: (1) direct ecological, environmental, and social impacts and (2) indirect environmental impacts. Direct ecological impact involves the complete destruction of 69,640 hectares of forest ecosystem and unique geographical features found in the Bakun region (see table 1). This ecological destruction will lead to a complete and irreversible breakdown in the integrity of the whole ecological system in the reservoir region. This large-scale ecological destruction will render the Bakun project Holling unsustainable.

Furthermore, the forceful displacement of all the indigenous communities as a result of the project has given rise to a wide range of socio-economic and cultural problems. Fieldwork and interviews conducted in the Bakun region, including the resettlement area which is located about 50 kilometers (kin) from the original settlement of the indigenous people, in 2000, 2002, and 2003 indicated that the removal of these people from their land and forest has generally led to economic hardship, social disintegration, and cultural extinction of the local communities in the Bakun region. Cultural extinction may be defined in Igor Matutinoviae's terms as "the abandonment of traditional subsistence activities and economic arrangements which were adapted to local ecosystems, or the complete loss of knowledge of these practices within the local population" (2001, 241). For instance, indigenous people in the new settlement area have ceased their tradition of welcoming their guests by performing ngajat (a traditional dance) as everyone is too busy looking for money in order to survive. Fieldwork and interviews conducted in the resettlement area also revealed that malnutrition, alcoholism, gambling, social vices, and intercommunity conflicts have, for the first time, become common among the various communities in the new settlement area.

It is noteworthy that to the Bakun indigenous communities land and forests not only serve as a source of income, food, and resources but also form an essential part of their social fabrics. Indeed, the very identity of the Bakun indigenous communities is intimately associated with the Bakun forest and their rights of use attached to it. Their culture also imposes on them a duty to protect and nurture Bakun's land and forest in such a way that they could be bequeathed to the future generations intact. This represents a form...

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