When Ethiopia’s plan to dam the Blue Nile grew grander within a month of the resignation of President Hosni Mubarak, it did not go unnoticed in his country, downstream, Nile-dependent Egypt.

The Grand Renaissance Dam, at 6,000MW, will be Africa’s largest hydroelectric project.

“We have the right to develop our natural resource,” says Alemayehu Tegenu, Ethiopia’s minister for water and energy.

“We were not benefiting much from the Nile. There is a group of people who are totally against the dam and they are not right.”

Aside from some green lobbyists who fear the destruction of the environment, he means Egypt.

Clinging to a colonial treaty signed in 1929, Egypt has veto rights over any upstream developments that might affect the Nile’s flow.

A series of agreements sees neighbouring Sudan awarded 18.5bn cu metres a year and 55bn cu metres for Egypt, even though Ethiopia is the source for 85 per cent of the river and was left out of a later 1959 deal.

Meles Zenawi, Ethiopia’s prime minister, has long challenged “old-fashioned ideas based on the assumption that the Nile water belongs to Egypt”. Even so, the dam could deprive Egypt of more than 17bn cu metres a year. The country relies on the river for 90 per cent of its water.

“Ethiopia has pushed this through in a time of turmoil in Egypt,” says an international official. “Egypt has not had the time or breathing room to focus on it – the new leaders have not been able to unite the country around a single issue and certainly not around the Nile.

“The guys in Addis have seen this opportunity and stepped right through it. If Mubarak was still in power today, it would have been the beginning of a water war,” says the official.

Mohamed Nasr El Din Allam, Egypt’s outgoing minister of water, says the dam will create shortages in water, power and farming land and lead to political, economic and social instability.

Ethiopia insists that its downstream neighbours Sudan and Egypt have nothing to fear from its decision to dam the Blue Nile, which feeds both countries. On the contrary, they will in fact both gain.

Mr Alemayehu says: “The dam will benefit both countries: it will not reduce the flow, but regulate it. They will benefit because it will reduce silt, control floods, regulate water flow throughout the seasons.”

Sudan and Egypt have calmed their responses in the past year and a technical committee has started work on an assessment of the dam’s impact. The committee is expected to report next year, but Ethiopia is not waiting. “We are allowing the establishment of the technical committee so as to build confidence,” says Mr Alemayehu.

Costing an estimated $4.8bn and taking four years to build, it is the sort of large-scale project that usually has donors and development finance institutions rushing to help, glad to have a project in so poor a country to spend their money on.

But they have not touched it. Instead, Ethiopian state television airs nightly appeals to everyone from bus drivers to businessmen, to buy bonds to support the project. Even political opposition figures are buying bonds in what has become a national rallying cry.

“Meles is being very smart on this – it is a very expensive dam but it is a transformative project,” says an international official. “I think Ethiopia will deliver on the first 20 per cent of it and by then donors will be rushing to come in.”

“Everyone is looking nervously to see how much progress there is,” says the official. Sudan and Egypt must also face the likelihood that the Ethiopian project sets a precedent, should other upstream countries such as Uganda or South Sudan, on the White Nile, decide to dam the river flow too.

Over the past two years, Uganda, Ethiopia, Kenya, Tanzania, Rwanda, Burundi and Democratic Republic of Congo have all signed an agreement to seek more water from the Nile, which they argue should be shared more fairly, Egypt says the agreement does not overturn the 1929 agreement.

The Nile’s water wars may merely be on hold.

* Originally published on the Financial Times, on June 19, 2012, titled “Nile dam: Water wars averted for now”, authored by Katrina Manson.


Check the Nile archive or the Grand Ethiopian Renaissance dam archive for related posts.