China Growth Phase II: The Next Mega Dam | Australian Markets

Thirty years in the past, China launched one of essentially the most bold development initiatives within the world: the Three Gorges Dam on the Yangtze River.

Construction formally started in 1994.

Remarkably, simply 12 years later, this giant infrastructure project was completed.

It shocked the world.

And it’s why the Three Gorges Dam project epitomises the early 2000s China growth story.

Sure, the development of condo buildings, bridges, highways, shipyards, and railways made headlines, however the Three Gorges Dam symbolised China’s emergence.

And now, twenty years on, China is placing a new flag within the ground:

On the jap rim of the Tibetan plateau, China is seeking to harness the roaring waters of the Yarlung Tsangpo.

This river would be the web site of a new mega dam — the world’s largest. A project that’s set to eclipse Three Gorges.

How massive is it?

The dam might be located within the decrease reaches of the Yarlung Tsangpo, alongside a part that drops 2000 metres over 50km, creating immense hydropower potential.

As you possibly can see beneath, it will likely be constructed within the area of Tibet, close to the border with India:

Once accomplished, this project will surpass the Three Gorges Dam because the world’s largest hydropower operation.

The area’s Premier Li Qiang described it because the “project of the century.”

In reality, this single dam will generate more energy than Britain’s whole annual output!

The value is estimated at round US$167 billion, about 5 occasions the Three Gorges Dam price tag.

But few have given a lot weight to this doubtlessly monumental curveball China has thrown right here…

The West firmly believes that China’s two-decade infrastructure build-out is regularly unwinding and that financial stagnation is inevitable.

That narrative has confirmed troublesome to reverse.

Not that China cares! The nation is pushing forward regardless of all of the Western doomsday financial predictions over the past ten years.

And with that, I consider it has firmly established ‘Phase II’ of its national infrastructure build-out.

So, let’s put this into context…

Iron ore miners, the great victors of the Phase I growth cycle, obtained a modest enhance from final month’s announcement.

But up to now, the news has fallen flat within the commodity area.

There’s no acknowledgment of the potential significance and how carefully it mirrors occasions from twenty years in the past.

You see, the Phase I growth story of the early 2000s was centred on the nation’s East, encapsulating rich metropolis centres like Beijing and Shanghai.

However, I consider this mega dam symbolises Phase II of China’s growth plans.

A strategy of opening up the nation’s Western frontier and aligning these underdeveloped areas with the rich provinces within the East.

Like the China Growth Phase I confirmed, you should first construct the power provide… Once that’s been assembled, all of the related infrastructure follows: condo buildings, warehouses, and railways.

Today, it appears unfathomable that China may repeat something like what it achieved within the early 2000s.

However, the worldwide economic system has a behavior of underestimating the Middle Kingdom.

As an investor, you shouldn’t underrate the potential right here… This may very well be the catalyst that drives commodity markets into a new upward cycle.

Twenty years in the past, China’s economic system boomed after the completion of the Three Gorges Dam.

The huge power it created fuelled the development of new mega-cities.

And now we have now a new dam underneath construction… But this time it’s a lot, a lot greater.

Stay tuned.

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Please search unbiased financial advice relating to your own state of affairs, or if unsure in regards to the suitability of an investment.

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