Malaysia has outraged environmentalists and bemused economic analysts by deciding to revive construction of a massive hydroelectric project in the heart of one of the world's last great tropical rainforests.The government of Mahathir Mohamad has announced that it will complete the Bakun Dam, which will flood an area the size of Singapore and feed a 2400-megawatt power station in a remote jungle area of Sarawak, in central Borneo.

The project, abandoned in late 1997 at the onset of the Asian economic crisis, will destroy the habitat of a vast range of endangered species and has already forced the relocation of about 10,000 tribal villagers.Environmentalists have compared Bakun with the ecological and economic folly of Tasmania's Lake Pedder hydroelectric scheme a grandiose project built at immense environmental cost to produce electricity for a very uncertain market.

Under the original scheme, up to 90 per cent of the project's electricity was to be transferred to industries on the Malaysian mainland via a 600-kilometre cable across the South China Sea, a plan dismissed as technically dubious by some international experts.

Now Malaysia's Energy Minister, Leo Moggie, said there would be no cable and the scheme's entire output would be consumed in the adjoining states of Sarawak and Sabah, with some power to potentially be onsold to Indonesian Kalimantan. Yet the predominantly poor and rural states now consume barely a third of Bakun's eventual output and Indonesia has vast hydroelectric potential of its own.

"We will build the dam to its full original height. Once completed it will spur more industrial development and investment in Sabah and Sarawak," Mr Moggie said this week.

The real impetus for reviving the project which the government says it will underwrite, but is yet to say how is political.

Elections are due to be held in Sarawak by September and the resumption of construction work will give a badly needed boost to the flagging local economy and help the Federal Government's campaign to retain control of the state. The project will also create thousands of jobs and throw a lifeline to the country's ailing construction industry.

Chairman of the opposition Democratic Action Party, Lim Kit Siang, said the project was not economically viable and was being driven entirely by the growing political pressure on the ruling United Malays National Organisation.

"They are hoping to win votes by promoting megadevelopment projects for the state in another example of money politic on a grand scale," Mr Lim said.

Dr Mahathir is a friend and supporter of the Sarawak tycoon Ting Pek Khiing, whose Ekran corporation was awarded the contract to build what was billed as SouthEast Asia's biggest civil engineering job in early 1995. After abandoning the project, Ekran was paid an estimated $US125 million ($237.5 million) in compensation by the government.

Environmental activists say the completion of Bakun will spell environmental disaster for Sarawak, where uncontrolled logging is already wrecking thousands of square kilometres of untouched rainforest and ruining whole river systems through siltation.

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