Taming the River Wild

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The only solution may be to bring in private capital from abroad by floating stocks and bonds, and Western bankers are ready to help. Says Ray Spitzley, executive director of Morgan Stanley Asia in Hong Kong: "China has evolved into a credit-worthy country that can tap world markets." Maybe so, but the poor showing of the few stocks traded internationally has made investors skittish. Eager to make their securities more attractive, Chinese officials are talking with the World Bank about setting up a Chinese National Power and Development Fund that would sell bonds backed by the bank to private investors.

While foreigners may be justifiably reluctant to help finance a project as audacious and controversial as Three Gorges, many indisputably worthy ventures, from coal gasification to experiments with solar power, are also begging for funds. Governments and investors naturally wonder if they can afford to gamble on China. But as the most populous nation threatens to pollute the entire planet, can the rest of the world afford to turn its back?