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Publication / 16 January 2025

Building dams in Cameroon: Hippos in troubled waters

Investors constantly grapple with uncertainty. They are on high alert in a world full of shifting tides. They have to navigate both a physical and a numerical world. The risks they face in an investment therefore need to be addressed in both the physical and financial landscapes.

An ‘annoying’ fact for investors is that dams are disaster-prone and create financial risks. Many dam projects end up with cost overruns, have revenue shortfalls and problems with environmental and social impacts. Neither do dams reckon enough with the impact of climate change. The stream of revenues out of electricity only is guaranteed for a short term, just long enough to be profitable, but after a dam’s comes ‘the deluge’.

Investors invest in dams, even when prior knowledge is present about their loss-making potential. To convince them reality is manipulated to suit their needs.

As this essay about a World Bank financed dam in Cameroon shows, the unpredictability of markets is being contained in the physical world by channeling and regulating a wild river with dams. In the financial landscape to accommodate investors, a river, is getting redesigned to generate power and to guarantee a continued stream of revenue. The guarantee of a steady income offers a kind of false financial security to investors, or a security only for the short term.

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