The National Audit Office (CNAO) has found that 272 million yuan ($34.8
million) of the funds allocated to the resettlement of residents displaced by
the Three Gorges Project in 2004 and 2005 was misappropriated by local
The Three Gorges Dam, China's gigantic hydro energy project,
is located on the Yangtze River
money was used to open local government-run businesses, pay off the debts of
other local departments, pay staff salaries in administrative departments, build
more office buildings and houses for people outside the resettlement project and
to pay off bank loans, according to the CNAO.
The central government allocated 9.6 billion yuan ($1.2billion) in
resettlement funds in 2004 and 2005.
Five major cases involving misuse of funds have been passed over to judicial
and disciplinary departments and some local officials are expected to be
punished, but the CNAO did not provide further details.
CNAO audited the use of the resettlement funds in 10 counties and districts
of Hubei Province and Chongqing Municipality in 2006.
Given the auditing process only covered certain regions and does not take
into account the use of the resettlement money in 2006, the actual total of
misappropriated funds could be even higher.
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