Dam decision takes Turkey by surprise

The dam project has long been the source of controversy

By Tabitha Morgan in Istanbul

The decision by UK construction firm Balfour Beatty to pull out of the controversial Ilisu dam project has caused as much surprise in Turkey as it has in Britain.

The move comes at a time when the UK was widely expected to approve export credits for the $1.5bn deal, as a gesture of good will to shore up relations with Nato's only Islamic member state.

The Turkish Government has made no secret of the fact that it hopes its involvement in the coalition against terrorism may lead to much-needed foreign investment in the economy.

Turkey recently committed 90 special forces troops to the ground war in Afghanistan, and its airbases in the south of the country would play a vital role if the war was to expand to include Iraq.

Critics say the project would destroy culturally-valuable sites

So this announcement by Balfour Beatty will certainly be regarded as a setback by the Turkish authorities.

Balfour Beatty was part of a consortium made up of two other European firms and three Turkish construction companies which together hoped to secure the contract for the dam - Turkey's biggest-ever infrastructure project.

Another of the two European companies pulled out at the same time Balfour Beatty.

The Turkish Government claims that the proposed 1,200-megawatt dam, which would stem the River Tigris less than 40 miles from the border with Syria, would provide irrigation and hydro-electric power to the impoverished south-east of the country.

Britain's involvement in the scheme has long been the subject of considerable controversy.

Kurdish concerns

Opponents claimed its construction would have disastrous environmental and social consequences and would involve the displacement of 36,000 Kurds from the region.

They argue that as many as 25,000 people would be made homeless and a further 11,0000 Kurds would be forced from their lands.

Balfour Beatty's withdrawal from the project will be viewed with some relief by Syria and Iraq

Last month a report on the dam's environmental impact commissioned by Balfour Beatty was attacked by a number of leading development agencies.

They claimed the report failed to address key issues surrounding the resettlement of local people and criticised the Turkish Government for making minimal efforts to consult local inhabitants.

Balfour Beatty's withdrawal from the project will be viewed with some relief by Syria and Iraq.

Both countries, which rely on the Tigris and Euphrates for their water supplies, had been growing increasingly uneasy about the expansion of Turkish control over the rivers.

Now that Balfour Beatty has withdrawn from the project, Turkey is likely to look for other partners to build the Ilisu dam - part of a much wider $32bn scheme to bring water to the arid south-east.