TED Case Studies


Hungary Dam


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             CASE NUMBER:                34 
             CASE MNEMONIC:            HUNGARY
             CASE NAME:                Hungarian Dam Controversy

A.           IDENTIFICATION

1.           The Issue

        The diversion of the Danube River onto Slovak territory
will change the international boundary between the two
countries.  It will affect Hungarian trade flows because duties
may be charged by Slovakia to cross their territory on the New
Danube River and the environmental impact of diverting the
river is immense.  The dam will result in the lowering of the
water table, the destruction of woodlands and wetlands, and the
contamination of water supplies.  Not only would it harm all
ecosystems that feed off the old river-bed, Hungarian critics
charge water supplies to some ethnic Hungarian Danube villages
will be cut off, while others would be flooded.  Slovakian
officials dismiss the environmental reports as alarmist and
tout the energy creating benefits of the dam.   Scientists
studying the project say even when the dam is fully
operational, it will only provide Slovakia with five percent of
its energy needs.

2.           Description

       Fifteen years ago, the idea of correcting "mother nature"
was in vogue in the communist countries of Europe.  Former
Soviet leader Leonid Brezhnev originated the idea of irrigating
the deserts of Soviet Asian territory by reversing the course
of Siberia's three great rivers, the Ob, Yensei, and Lena.  By
constructing a series of man-made dams, the plan was to divert
the water into massive irrigation channels spread throughout
the territory.  Although his idea was (fortunately) never
implemented, it did provide inspiration to the communist
leaders of Czechoslovakia and Hungary, who decided to dam the
Danube River.  On May 6, 1976, the governments of the two
countries signed the Joint Agreed Plan, which undertook to
construct the Gabcikovo-Nagymoros Barrage System to conquer
nature.  The plan was to divert the Danube River into a new
river bed or canal that would produce electric power, become
the new route for international inland navigation, manage water
supplies, and aid the economic development of neighboring
regions.

       The Barrage system was to consist of a reservoir, two
diversion canals, and two hydroelectric power plants located in
present-day Slovakia and Hungary (Gabcikovo and Nagymoros
respectively).  The environmental effects from re-routing the
Danube into two diversionary canals, while still discharging
water into the old Danube river bed, had serious consequences
for both Hungary and Czechoslovakia.  However, the need for
domestic energy production spurred construction of the project.

       When the political regimes in both countries changed in
1989, an environmental assessment was made on the Barrage
system due to the growing environmental consciousness in both
countries.  It was noted that the dam project would cause
serious problems to the drinking water supplies, the water
tables, natural resources, and plant and organic species.  

       The interpretation of the study varied in each country. 
The Czechs and Slovaks believed subsequent technical
corrections would be sufficient to correct the environmental
damage that would occur.  The Hungarians did not believe this
to be sufficient, and after enormous political pressure from
environmentalists, they stopped work on the Nagymoros dam on
July 20, 1989.  Meanwhile, the Czechoslovak Party gave notice
to a new provisional solution on August 31, 1993 -- to divert
the Danube on Czechoslovak territory.  By simply building their
own dam farther upstream, and safely within their own sovereign
territory, the new solution virtually ensured the Slovak
continuation of the Gabcikovo project.  This not only would
have the aforementioned environmental effects, but the new
solution was also a violation of international law because it
altered the line of the natural border between the two
countries, namely the middle of the Danube River, and changed
the navigational route for trade through Slovakia.  

       This change of the navigational route will severely affect
export and import trade of Hungary.  If cargo ships bound for
Hungary have to cross Slovak territory to reach Hungary, goods
will be susceptible to Slovak tariffs and duties.  Slovakia
will also have the means to strangle Hungarian trade along the
river if conflict does arise between the two countries. Because
of the large Magyar population in Slovakia, there is already
tension between the two countries.

       The European Community became involved to avoid another
possible European conflagration.  In November of 1992 the
European Community began a series of conciliatory moves to
broker a cooperation agreement between the Slovak and Hungarian
governments.  A joint committee consisting of Slovak and
Hungarian experts, as well as European Commission
representatives, has been set up to ensure consultations on the
water distribution system.  In view of the Slovakian
determination to continue construction of the dam, the European
Commission believes a compromise over the amount of water
diverted to the Slovakian turbines is needed so that the brunt
of the environmental damage can be avoided by ensuring
sufficient water levels in the old river bed.  

       Even this plan has been met with opposition.  Slovakia
wants to follow through on the original plan for the complex
and remove an average of 1,400 cubic meters of water per
second, or two-thirds of its natural volume, from the river to
fill its diversionary canal and a nearby reservoir during a
two-year test period of the complex.  Hungary is fiercely
opposed to this plan, citing the negative impact on the quality
of drinking water in the region.  According to a published
study by the World Wide Fund for Nature (WWF) the reduced flow
in the river's natural bed would threaten water reservoirs with
increased deposits of polluted clay.  The European Commission
has asked Slovakia to divert only a third of the Danube's flow
and leave the remaining two-thirds of the water in the natural
river bed.  The Slovaks say that their turbines must have at
least two-thirds, and that if the Hungarians want to raise the
water level in the original channel, they can build auxiliary
dams.  Hungarian officials believe such installations would be
as damaging as the diversion itself. 

       Hungary has refused to initiate a military response.  The
current government appears to remain committed to finding a
diplomatic solution to the problem.  In light of the fact that
the Slovakian actions affect political, economic, and
environmental security internationally, on October 29, 1992
both sides agreed to allow the International Court of Justice
to rule on this matter.  The Slovaks insist it is the
Hungarians who have violated international law by officially
and unilaterally abrogating the original dam treaty.  The
European Union is insisting that Slovakia should accept the
compromise proposal, and continues to act as a mediator between
the two governments.  Although the case is still under review
by the International Court, the Slovaks have since completed
the Gabcikovo dam. On the Hungarian side, earlier plans to
start dismantling their dam at Nagymoros have not been
undertaken.

       From the 18th century, Czech nationalists sought to create
a state whose borders would reach the Danube as well as connect
it with other Slav territories.  The Paris Peace Conference at
the end of World War I accomplished this goal.  Bohemia and
Slovakia were joined, incorporating Hungarian territories
within the Slovak side of the Danube.  The greater desire of
both the Czechs and Slovaks was to obtain Hungarian territory
on both sides of the Danube giving the new nation unilateral
control of the river.  

       Negotiations between the governments of Czechoslovakia and
Hungarian to build the Gabcikovo-Nagymaros Dam date back to
1951. The original intent of the project was to alter the
shallow reach of the Danube between Bratislava, Czechoslovakia
and Gyor, Hungary and to connect the two countries to the
Danube-Main-Rhine trans-European waterway.  The project was
strongly supported by the Soviet Union whose ships transported
large quantities of goods through this part of Eastern Europe. 
Via this waterway, direct access to the Black Sea from Budapest
and to the North Sea from Bratislava would be possible.  Joint
planning on the waterway began in the 1950s.  An important
component of the long-term plan was to assess the environmental
and regional impacts of a dam project.  

       While the original intent of the project was to construct
a navigable waterway, the priority of the project was refocused
in the 1970s toward energy production.  This reorientation was
driven by two factors.  First, with the oil shocks of the 70s,
petrol prices were increasing.  Thus, it was in the best
interest of Czechoslovakia and Hungary to produce more energy. 
Second, the only way the Hungarian water management bureaucracy
was able to gain necessary support and resources within Hungary
was to emphasize energy production.  Hungary always held less
enthusiasm for the project than Czechoslovakia because of the
Czech's desire to unilaterally control the Danube.  Hungary
succumbed to Soviet domination and signed on to the project.                    

       In light of the oil crisis and recentralization of Soviet
power after the Czechoslovak revolution of 1968, Czechoslovakia
and Hungary hastily signed a "Treaty Concerning the
Construction and Operation of the Gabcikovo System of Locks"
(the 1977 Treaty) in September 1977.  This signing cut short
further environmental and regional impact studies which were
slated for completion at the end of 1978.

       The project plan included four objectives:

       First, it would manage water flow against flood
protection.  By building a canal within Slovakia, the peak flow
of the old Danube channel could be controlled as could
hydraulic pressure on existing levees. Around Nagymaros on the
Hungarian side, embankments were to be reinforced to protect
land banks from erosion.

       Second, it would create a navigational inland waterway
within Slovakia which met the Danube Commission recommendations
of a channel 180 meters wide by 3.5 meters deep.  This depth
would accommodate barge traffic permitting the Slovak
government to increase shipping revenues at the Bratislava
port.

       Third, it would produce electricity by constructing two
hydroelectric power stations.  On the Slovak side, the
Gabcikovo power plant would have installed capacity of 720 MW
and an annual production of about 3.0 billion Kwh.  In Hungary,
the Nagymaros Dam would have installed capacity of 158 MW. 
Annual production was forecasted at 1.0 billion Kwh.

       Fourth, it would conserve the ecosystem of the inland
       delta of the Danube by slowing the river current and
       preventing erosion.  Directing water to river-side forests
       and side-arms of the Danube would prevent desiccation of
       these areas.

       The Gabcikovo system consisted of a head reservoir
measuring 60 square kilometers, a dam and system of locks at
the reservoir.  From this reservoir, a 17 km by-pass canal
within Slovak territory was planned to divert water to a power
plant at Gabcikovo.  The head reservoir at Dunakiliti
straddled Hungarian and Slovak territory.  Approximately 90 to
97 percent of the Danubežs flow would be diverted to
Gabcikovo.  The remaining flow would be diverted 8 kms back
to the old Danube river bed.  Nagymaros, the second power
station, was to be built approximately 100 kms downstream of
Gabcikovo.  The Nagymaros Project was also to include a dam and
reservoir and lock system.  The site of the power station was
located entirely within Hungary.  

       An agreement signed prior to the 1977 Treaty set the years
1986 to 1990 for starting operations of  the Gabcikovo-
Nagymaros.  The 1977 Treaty stipulated that state borders would
be respected according to the present navigation line of the
old Danube river bed.  Provisions regarding protection of
the environment included that (1) the water of the Danube was
not to be impaired as a result of the construction and
operation of the dams and locks; (2) compliance with the
obligation for the protection of the environment was to be
ensured and (3) the old bed of the Danube was to be
maintained..

       Construction on the Gabcikovo power plant began in 1978,
but was suspended in June 1981 when Hungary, caught up in a
deepening economic crisis, realized it had neither the
technical nor financial wherewithal to continue construction. 
Faced with this economic crisis and sharp criticism from the
Hungarian Water Association as well as from a grassroots
political party, Hungarian officials suspended further
construction.  In addition, a review of major national
investments was ordered.  Finally, an agreement with Slovakia
was signed that changed the project deadline to 1994 and
postponed construction of Nagymaros until 1988.

       During this delay, Hungarian opposition to the project on
environmental grounds was further mounting. Under pressure from
the opposition, the Hungarian Parliament demanded that the
ecological risks of the project be studied further. 
Construction of Nagymaros was taken up again in 1985 at the
behest of the water management lobby.  However, public debate
against the project continued.  By 1987, the democracy movement
in Hungary was beginning to take shape.  A group of independent
politicians and representatives of the project opposition who
had been elected in 1985 initiated a reexamination of the
project.  Construction continued in 1988 while controversy over
the project grew increasingly heated. to gain needed popular
support in the fight against conservatives, the reformist wing
of parliament used the Gabcikovo-Nagymaros Project as a
political tool.  On the strength of the reformist movement and
finding that ecological and technical evaluations were
insufficient during the initial planning phase, the Hungarian
government unilaterally suspended further construction of the
Nagymaros Dam and the Dunakiliti works on May 13, 1989.  In
addition, the Parliament authorized the government to enter
into negotiations for the termination of the 1977 Treaty.  

       In the autumn of 1989, radical political changes in
Slovakia witnessed a more moderate tone in the on-going
conflict between Hungary and Czechoslovkia.  Hoping to find a
solution to the problem, the Hungarian government proposed that
the conflict be resolved on the basis of independent scientific
investigation.  In addition, until free elections of 1990 had
been held in both countries, Hungary proposed that all work on
the project be stopped.  The Czechoslovak government under the
leadership of Vaclav Havel agreed to the environmental
investigations, but insisted on the continuation of work due to
the huge sums of money already invested in the project.  The
Slovaks argued that additional installations could be added to
the project to protect the environment and therefore, Gabcikovo
should be put into operation to amortize investment costs.

       A series of negotiations continued between the governments
without resolution of the problem.  Finally, in April 1992, the
Commission of the European Community made an offer to form a
trilateral committee of experts to settle the dispute.  The
offer was subject to several conditions however: (1) both
parties would accept the findings of the expert panel, and (2)
while the study was being carried out, neither side would
engage in any actions which would prejudice the panelžs
findings.  The first condition was agreed upon, however,
Hungary felt that the second condition necessitated the
suspension of Variant C because it was conceived unilaterally
and included construction outside of the 1977 Treaty.  The
Czechoslovak authorities disagreed arguing that not continuing
would mean losing 2,000 Kwh per year of electricity amounting
to 6,000 million CKS per year (US$1/CKS28.90).  It was
announced that Gabcikovo would begin operations by October
1992.  Still without a resolution to the problem, Hungary
declared a termination of the 1977 Treaty as of May 25,
1992.  On October 24, 1992, the damming of the Danube began
and Variant C was put into operation.  

       Beginning October 28, 1992, trilateral negotiations
between Czechoslovak, Hungarian and European Community
officials led to the signing of the London Protocol.  This
agreement stipulated that žall works [operations] on Variant C
(except for works related to flood control, navigation and
environmental protection) should be postponed for a period
determined by the EC.  Czechoslovakia guaranteed to maintain
not less than 95 percent of normal flow  in the old Danube
riverbed and to refrain from operating the power plant at
Gabcikovo.  The agreement further established that three
experts nominated by the European Commission would review
Variant C, environmental risks, water economy, navigation  and
requirements for flood protection.  The expert panel was to
further study the possibility and costs of reversing the
Gabcikovo constructions.  On the basis of these findings,
further steps for a common solution were to be identified. 
Hungary and Czechoslovakia agreed that the International Court
of Justice at the Hague should decide the case, taking into
consideration all legal, economic and environmental matters.

       The Gabcikovo-Nagymaros case remains with the
International Court of Justice.  A decision is not expected
before 1997.  In April 1995, Slovakia and Hungary signed a
temporary agreement on the replacement of water in the old
Danube River channel.  The agreement is to ensure the necessary
diversion of water by Slovakia to the Szigetkoz region before
the International Court of Justice makes its ruling.  Disputes
that arise during the temporary agreement period will be
addressed by the European Commission.  A primary motivation for
the temporary agreement was to show European neighbors that
Slovakia and Hungary are capable of solving disputes in a
European manner.  Both Hungary and Slovakia have expressed a
desire for membership in the European Union.

       Under the agreement, Slovakia has agreed to raise the
water level in the main bed of the Danube to 400m3/sec,
compared to an average flow of 2000 m3/sec before the
diversion.  The Slovaks estimate that this will lessen the
output of Gabcikovo by 300 million kilowatt hours or about US$
10 million.  Water level measurements taken in the Danube
shortly after its October 1992 damming led Hungarian officials
to believe that Slovakia never complied with its agreement
under the London Protocol to maintain 95 percent of the
Danube's flow in the old river channel.  The Danube was
reportedly about 2 meters below the lowest mark ever recorded. 
Hungarian official estimated the flow to be between 220-350
m3/sec.

       For its part of the new agreement, Hungary agreed to begin
the construction of a weir at Dunakiliti to forward more water
to the tributaries of the Danube.  The building of the weir was
to commence 10 days after the signing of the agreement and is
to be completed within 50 days after construction start.  
Hungary will finance the total cost of the weir, estimated at
450 million HUF (HUF125/$1US).

       In July 1994, Hungary begun to pump water from the
depleted waters of the old Danube to revive their wetlands. 
This has helped replenish streams and created an environment in
which people can again swim, fish and boat in resort areas.  In
December 1994, demolition of the 1.9km Nagymaros dam began. 
Nagymaros should be completely dismantled by July 1996 at a
cost of $US 91 million.  Yacht and other water sports
facilities are planned for the site.  

       An article appearing in the July 16, 1994 issue of New
Scientist reported that the World Wide Fund for Naturežs
campaign against Gabcikovo was stopped in July 1994 after
scientific refutation and a critique of WWF statements was made
by a leading Slovakian hydrologist.  According to the article,
WWF officials conceded that had the Nagymoros dam been built as
originally planned, the water resources of the entire region
would have improved.  It was further reported that WWF
apologized to Slovak authorities claiming that Gabcikovo may be
good for the environment after all.  The article states that
desiccated wetlands have been revived, recharging underground
water supplies. Plant and animal life have been revived as the
ground water level has risen in formerly dry meadow lands
upstream from the dam.

       Contrary to the New Scientist article, WWF maintains that
the "past and present ecological impacts of Gabcikovo remained
of great concern."  In October 1994, after complete review
of the Slovakian hydrologistžs report, WWF communicated that it
žfeared that the dam will drastically alter the hydrology of
the Danube floodplain and inflict serious and lasting damage on
the regionžs biodiversity.  Further, WWF stated its concerns
that the Slovak critique "only addresses part of the problem
affecting groundwater impacts in the area and ignores long-term
impacts such as the ecological impacts of the floodplain
dynamics."  WWF recommended several short-term and long-term
measures that should be undertaken to restore the hydrological
and morphological dynamics in the region.  In the short-term
WWF maintains that:

       The old Danube river bed should receive a discharge of
between 600 m3/sec and 940 m3/sec.  This will permit the
migration of fish and other organisms in the river bed.
Islands and gravel banks in the old river bed should be
constructed.  Sediment in the old river channel will reduce
water flow, allowing the water level to increase and spill over
into desiccated river side arms, and 

       WWF believes that short measures will lessen but not
totally curb environmental damage to the region.  Reversing
ecological alterations and preserving the Danube floodplains
and groundwater reservoir requires longer-term measures. 
Specifically, WWF advocates a discharge of about two thirds of
the Danube water in the old bed, and constricting the Cunovo
reservoir to a navigation route.
 
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             Keyword Clusters                 

       (1): SIC                               = UTILity
       (2): Bio-geography                     = TEMPerate        
       (3): Environmental Problem             = HABITat loss

4.           Draft Authors:  Kevin Kurland, Jerry Fortunato, AND
Leslie Barcus.

B.           LEGAL Clusters

5.           Discourse and Status:  DISagreement and INPROGress

       The parties disagree about the environmental, political,
and economic ramifications of diverting the Danube to
Gabcikovo.  The case is currently pending at the Court of
International Justice at The Hague, and European Union (EU)
negotiators have affirmed the commitment of all parties to a
negotiated solution and binding international arbitration.

       Hungary and Slovakia disagree about the environmental,
legal, and economic aspects of the project.  After failure to
reach agreement through bilateral negotiation and assistance of
the European Commission, the case was referred to the
International Court of Justice at the Hague in October 1992. 
No decision is expected before 1997.

6.           Forum and Scope:  SLOVakia and BILATeral

7.           Decision Breadth:  2 (Hungary and Slovakia)

8.           Legal Standing:  TREATY

       Diverting the Danube into Slovakia will cause problems for
trade with Hungarian exporters and importers who use the
waterway for transportation.

C.           GEOGRAPHIC Clusters

9.           Geographic Locations

       a.    Geographic Domain : EUROPE
       b.    Geographic Site   : East Europe [EEUR]
       c.    Geographic Impact : SLOVakia

10.          Sub-National Factors:  NO

11.          Type of Habitat:  TEMPerate

D.           TRADE Clusters

12.          Type of Measure: Import Tax [IMTAX]

       Slovakia's control of the Danube shipping route has
created a potential disadvantage for countries desiring to ship
cargo on the river.  First, Slovakia could block the route for
political or security reasons.  In this case, shippers would be
forced  to use more expensive ground transportation
alternatives.  Second, to protect their foreign exchange
reserves, Slovakia taxes most imported goods.  If this tax is
levied on exports passing through Slovakia, these goods will be
less price competitive upon reaching their final markets. 

       A secondary potential effect of Gabcikovo relates to power
production and electricity exports. Slovakia is currently
seeking funding for the completion of the Mochovce Nuclear
Power Plant which would generate 1760 MW of power.  If
Mochovce is completed, it would replace capacity at another
Slovak nuclear site, Bohunice.  Nearly $200 million in safety
upgrades are currently being undertaken at Bohunice even though
its closure is scheduled for the year 2000.  In 1993,
Slovakia was able to meet about 95 percent of its energy needs. 
Should the Slovak government decide not to shut down Bohunice,
they could produce electricity for export.  Information on the
Mochovce case suggests that the Slovak government intends to
export electricity once Mochovce is operational.  Slovakia can
export nuclear generated electricity to western Europe at
roughly 60 percent of its price in the west.  Electricity
produced at Gabcikovo provides the Slovak government greater
flexibility with respect to electricity exports.  Output from
Gabcikovo could be exported or be used to meet domestic demand,
freeing up other output for trade.

13.          Direct vs. Indirect Impacts:  INDirect

14.          Relation of Measure to Environmental Impact

       a.  Directly Related            : NO
       b.  Indirectly Related          : NO
       c.  Not Related                 : NO
       d.  Process Related             : YES  HABITat Loss

15.          Trade Product Identification:  MANY

16.          Economic Data

       The trade accounts most likely to be impacted by the
diversion of the Danube are those of Hungary, although it is
difficult to speculate if and to what level Hungary may be
impacted by Gabcikovo.  Hungaryžs exports to western countries
decreased 12 percent from 1992 to 1993 but improved in 1994,
growing by 18 percent.  Exports to former communist trading
partners has declined since 1992.  This is likely because of
the westžs ability to find relatively cheap goods in Hungary
and in eastern markets generally.  The decline in Hungaryžs
trade with the east is likely reflective of economic downturn
associated with reform in the former Soviet Bloc economies. 
Thus, it appears that Hungaryžs export of goods to the west has
not been impacted to any large degree by the unilateral
diversion of the Danube.  Exports for Hungary to western and
eastern trading partners are as follows:

Table 1. Hungarian Exports (US$ millions)

                          1992         1993         1994

Western Europe            590.0        524.5        640.6
Eastern Europe            2077         18771        552
Czechoslovakia            290          297          na

Source: EIU Country Report: Hungary.  2nd quarter 1995. 

       Slovakia runs a trade surplus now with Hungary (see Table
34-1).  However, the degree of trade dependence between the two
countries is quite small.  



17.          Impact of Measure on Trade Competitiveness:  Low

18.          Industry Sector:  UTILities

       The Danube is the only major waterway linking Hungary with
Northern Europe.  A look at the table below describes Hungary's
direction of trade as a share of 1992 exports and imports (see
Table III-34-2).  Close to 50 percent of its trade occurs with
the European Union (EU) and one half from Germany.  If the
Danube is altered onto Slovak territory, there will be no way
for one-fourth of their trade to reach its destination without
being tariffed.  The only alternative for the Hungarians would
be to transport their goods into the EU via Austria.  This is
possible because Austria is a member of the European Free Trade
Association, which has signed a free trade accord with Hungary. 
However, transportation costs will increase because Hungary
will need new lorries and it will take much longer to transport
products by ground.  In many East European countries the export
of agricultural products that use ground transportation is
essential to their economic restructuring plans (see HOOF
case).
                            [Table III-34-2 about here]

19.          Exporter and Importer:  MANY and MANY

E.           ENVIRONMENT Clusters

20.          Environmental Problem Type:  HABITat Loss

       (1) Water pollution: The hydrological and hydraulic
       changes will be a significant cause of water pollution.
       (2) Species loss: There are more than 60 protected
       plants in Szigetkoz, including 63 types of fish which
       will experience a loss in habitat and possible
       extinction.
       (3) Resource conservation: The drastic changes to the
       forest populations of Szigetkoz will lead to their
       degradation and decay.  

       Data and information collected on the ecological impacts
of the Gabcikovo-Nagymaros Project are best described as
inadequate.  A critique of the Gabcikovo Project of March 1993
notes that no complete environmental impact study had been
undertaken during the many years of planning and subsequent
operation of Gabcikovo.  The International Rivers Network
ranked the Project among the top 10 most environmentally
destructive hydraulic engineering projects in the world.

       Construction has contributed to the loss of thousands of
hectares of forest floodplain, agricultural lands and Danube
countryside.  As the diversion of the Danube began, thousands
of dead fish were found near the dam.  With the closing of the
old river bed, water in certain branches of the Danube fell by
six feet; other beds dried out completely and the groundwater
table fell to twelve feet below the soil.  It is feared that
such conditions will devastate the flora and fauna in the
region.  Anticipated contamination of groundwater and drinking
supplies threaten the health of human inhabitants in the
region.

       Disagreement over environmental impact is at the base of
this dispute.  The Hungarians argue that the project is
environmentally devastating and that little short of stopping
the operations at Gabcikovo can restore the region.  Slovak
authorities maintain that the project is reviving formally
desiccated wetlands and is environmentally advantageous. 
Following is the expected environmental impact as presented by
the Hungarians and Slovaks:

       According to a critique of the Gabcikovo Project, Damming
the Danube, endangered  are 130 species of birds or 54 percent
of the regionžs aviary population; 30 mammal species; 8 reptile
species; 6 amphibian species and 28 species of fish.

       Seventeen protected areas and 4 reserves are endangered by
the project.  The small Hungarian island of Szigetkoz, a
habitat of rare and elsewhere unknown animal and plant species,
dried out after the initial damming of the Danube.  Of
Hungaryžs 80 fish species, 60 are found in the region, 12 of
them are protected.

       Slovak supporters of the project acknowledge the loss of
valuable forest lands and some flora and fauna during project
construction.  However they assert that as water is returned to
branches of the Danube, forests, plant and animal life will be
revived.  An article appearing in the July 16, 1994 issue of
New Scientist reports that since the Slovaks began diverting
water back into the Danube wetlands in 1993, branches that have
been dry for 30 years are being revived.  The WWF maintains
that the ecological impact of the project is disastrous even in
light of these reports.

       The largest drinking water supply in central Europe
originates from the several hundred meter deep gravel sediment
on the river bed.  Daily water output from this source is about
one million cubic meters for Hungary and 2.3 million cubic
meters for Slovakia.  It was reported in the summer of 1993,
that the water supply at Samorin had reduced production to two
thirds of normal supply.  Samorin supplies roughly 40 percent
of Bratislavažs drinking water.   Slovak authorities claimed
this shortage was made up by a surplus of drinking water in
other wells.  The WWF recommended that monitoring data be
checked by an independent institution to verify the status of
drinking water supplies.  The expected impact to ground and
drinking water supplies is that as the flow is slowed in the
old river bed, larger deposits of polluted silt, and bacteria
will infiltrate water supplies. 

       Slowing the flow in the old river bed is expected to
seriously impact fish breeding.  Spawning and young fish will
be stifled by sediment and flow fluctuations.  The fish stock
is anticipated to decrease by 66 percent   Vodohospodarska
Vystavba, the operators of Gabcikovo, report that new fish
ponds were constructed under the project which create optimal
conditions for fisheries. 

       WWF posits that two thirds of river bed erosion has been
caused by excavation from 1976 to 1989 for industrial projects
including the construction of Gabcikovo.  This excavation
threatens the stability of bridges in Bratislava and has
lowered groundwater tables.  Slovak authorities claim that
river bed erosion resulted from an intense program of hydro-
power plant construction was started along the German and
Austrian Danube sections.  These projects have caused
fundamental flow changes in the Danube, flushing out gravel,
deepening the river bed below Bratislava and worsening the
navigational conditions of the Danube.  In addition, the
underground water table has begun to sink, accelerating the
desertification of  fertile lands in Slovakia.

       Damming the Danube has dramatically altered the flow and
volume of water in the old river channel.  Prior to Gabcikovo,
water flowed at 2,000 m3/sec.  After the project, the flow
was reduced to less than 400 m3/sec.  This reduced flow will
negatively impact the survival of plant and animal forms in the
region. 

21.          Name, Type, and Diversity of Species 

       Name:              Many
       Type:              Many
       Diversity:         1,061 higher plants per
                          10,000 km/sq (Hungary)

22.          Impact and Effect:  HIGH and Structural [STRCT]

       Because the Danube is the lifeblood of all living species
in the area, a dramatic shift in the river's height, speed,
movement, and water quality will have a very high impact on all
the resources of the region.  Delicate marshlands and wet land
habitats in north-west Hungary have already been destroyed.  

23.          Urgency and Lifetime:  LONG and 100s of years

       Most environmentalists predict that within 10 years of the
operation of the  Gabcikovo dam, serious degenerative effects
will occur with the forests due to the change of seasonal
fluctuation, many species will be extinct due to new conditions
of competition, predation, and interaction, and the water
quality will be very poor due to modification of the oxygen
supply and silt pollution.  In fact, percolation and natural
filtering that occurs in the uppermost layer of river bed will
be affected, polluting surface and ground water. 

24.          Substitutes:  Conservation [CONSV]

VI.          OTHER Factors

25.          Culture:  NO

26.          Trans-Border:  YES

       This is an issue because it is a trans-border case. By
diverting the Danube, the Slovakia has in effect altered the
frontier between itself and Hungary, which had been the center
of the river.

27.          Human Rights:  YES

       Conflicts over national minorities living in Slovakia and
Hungary have long been a problem in the relations between the
two nations.  Historically, Slovakia was long under Hungarian
rule.  Ethnic Slovaks were subject to suppression until the
abolition of the Austro-Hungarian empire in 1918.  Slovak
territory was reformed in 1920 under the Treaty of Trianon and
confirmed by the Paris Peace conference of 1948.  Hungary,
considering these borders forced upon her, has during different
conflicts sought to reclaim former lands. Participating in the
division of Czechoslovakia in 1938, Hungary took over 102
Slovak minority communities.  Hungary also participated in a
forced military occupation of eastern Slovakia in 1939.  

       After World War II, borders were returned to their pre-war
state.  All Hungarians claiming to be of Hungarian nationality
were transferred to Hungary.  Those declaring themselves of
Slovak nationality remained in Slovakia.  Those living in
Hungary who claimed to be of Slovak origin were transferred to
Slovakia.  Civic rights and rights to free press were granted
to Hungarians living in southern Slovakia and in 1952, a law
was passed allowing Hungarians to participate in public
administration.  Ethnically-mixed southern districts of
Slovakia remained legally bilingual.  Basic minority rights
were written into the new constitution of 1960.  

       Ethnic conflicts were renewed in 1990 when the Slovak
National Council passed a law making Slovak the national
language.  With the break-up of Slovakia and the Czech Republic
in 1993, attacks and displays of nationalism began to increase. 
The conflict gained political momentum when, in 1993, Slovakia
asked to be accepted on to the Council of Europe.
Representatives of the Hungarian minority presented a
memorandum expressing reservation toward the Slovak
constitution and Slovakiažs membership to the Council.  The
memorandum included a survey of minority rights violations in
Slovakia and criticized government policy. Slovakia was finally
accepted on June 30, 1993 on the condition that it respected
the rights of national minorities. 

       In opposition to the Hungarian minority, the Slovak
parliament passed a law that first and surnames be Slovakized. 
The Parliament further demanded that signposts with bilingual
place names be removed. Following a wave of protest, the Slovak
parliament approved a law allowing minorities to use first
names and surnames in the form of their own language.  On July
7 the law on bilingual place names was abolished. 

       Slovak political leaders reject criticism of Slovak
policy, saying that Slovak Hungarians have rights in the form
of schools, display of culture, political organizations, media
and language autonomy.  They reference the Slovaks living in
Hungary who in many respects have lost their Slovak identity. 
More than 560,000 people in Slovakia declare themselves to be
of Hungarian nationality (10.8 of the population) compared to
about 10,000 Slovaks living in Hungary. 

       The Gabcikovo project has been at the center of the on-
going dispute regarding ethnic Hungarian minorities.  A Slovak
opposition party representing this minority claims that the
basic aim of large-scale industrial projects carried out in
South Slovakia by the former communist government was the
evacuation and assimilation of the Hungarian minority.  The
party points to a national development plan drafted in the
early 1980s which urges the "industrial expulsion of the
Hungariansž with the construction of four large projects
including Gabcikovo."  Inhabitants in the region of
Gabcikovo were largely ethnic Hungarians who were displaced
with the building of the power plant. 

       On March 19, 1995, the prime ministers of Slovakia and
Hungary signed the Basic Treaty between Slovakia and Hungary. 
The Basic Treaty contractually defines the protection of the
rights of the national minorities living in the two territories
and incorporates the acceptance of a recommendation of the
Council of Europe which specifies the settlement of disputes by
peaceful means  It is too soon to know how or if this Treaty
will effect Hungarians who were displaced due to the
construction of Gabcikovo.  

       Determining if Variant C has changed the national
boundaries of Slovakia and Hungary is one of the most difficult
matters of the case.  Prior to the signing of the 1977 Treaty
(the basis of the Gabcikovo-Nagymaros Project), the boundary
between the two countries was legally established by the 1920
Peace Treaty of Trianon, the 1947 Treaty of Peace with Hungary,
and the 1956 Treaty between the Czechoslovak Republic and the
Hungarian Peopležs Republic concerning the Regime of State
Frontiers.  These three treaties, in accordance with
international law, set the boundary as the main navigable
channel of the Danube at the lowest navigable level.  The main
navigable channel now runs through the water reservoir at
Cunovo and the inland canal, both of which lie in Slovak
territory.  The 1956 Boundary Treaty in part states : "[O]n
sectors where it runs over water, the frontier line shall vary
with the changes brought about by natural causes in the median
line of the bed of rivers, streams or canals or on the main
navigable channels of navigable rivers.  The frontier line
shall not be affected by other changes in the flow of a
frontier watercourse unless the Parties conclude a separate
agreement to that effect."  The Boundary Treaty further
stipulates that the change of flow of boundary waters will not
be changed unilaterally

       The 1977 Treaty states that žapart from minor revisions,
the state frontier should be the centre line of the present
main navigation line.  Slovak authorities give precedence to
the 1977 Treaty and argue that they are operating within its
stipulations.  Furthermore, Slovkia posits that Hungary has
violated the Treaty by unilaterally withdrawing from the
project.  Hungary justifies withdrawing from the 1977 Treaty on
environmental grounds (perhaps the sole justification from
withdrawing from this otherwise non-cancelable treaty) and
argues that Slovakia's Variant C has altered the lowest
navigable level of the Danube, thus altering national
boundaries.  Further, since the decision to build and operate
Variant C was made unilaterally, Slovakia is deemed in
violation of previous boundary treaties.

28.          Relevant Literature 

Berrisch, George.  "Construction and Operation of Variant C of
       the Gabcikovo-Nagymaros Project Under International
       Law: Legal Study for the World Wide Fund for Nature." 
       Prepared by Schon, Nolte, Finkelnburg & Clemm for
       WWF.  October 1992.  Brussels. 

"Country Report: Hungary," Economist Intelligence Unit.  2nd
       Quarter 1995. 

CTK National New Wire.  "Profile of Hungarian Slovak
    Relations," March 17, 1995.  As provided by Lexis/Nexis. 

Dister, Emil et al.  "A New Solution for the Danube."
    WWF Statement on the EC Mission Reports of the Working
    Group Monitoring and Management Experts and               on the
    Overall Situation of the Gabcikovo Hydrodam Project. 
    December 13, 1993.  Vienna. 

Embassy of Hungary.  Bos-Nagymoros File (Budapest, October
    1992).

European Information Service. "Europe Environment," March 2,
     1993.

"Gabcikovo Compromise Accord Approved by Slovak Government,"
    April 18, 1995.  

"Gabcikovo-Nagymaros Project:  Standpoint of the Czecho-Slovak
    Side and Answers to Questions."  April 1992. Bratislava. 

Global 2000 and Greenpeace.  "Mochovce-Documentation for 
    Opinion-Leaders." June 1994. 

"Hungary, Starts Final Demolition of Nagymaros Dam," December
    9, 1994.  The Reuter European Business Report.  As
    provided by Lexis/Nexis.

Husarska, Anna.  "Dam Cheek," The New Republic. December 21,
    1992. 
 
"Industrialization of South Slovakia an Anti-Hungarian Plot?"
    April 1, 1995.


International Environmental Reporter.  "Dam Construction Moves
    on Despite Intense Environmental Opposition," November 18,
    1992.  As provided by Lexis/Nexis.  

International Monetary Fund Statistical Yearbook 1994.  IMF:
    Washington, D.C.

Kim, Julie.  "Poland, Czech Republic, Slovakia, and Hungary: 
    Recent Developments."  CRS Issue Brief (Library of
    Congress, September 27, 1993).

Martin, Claude, Director General for World Wide Fund for Nature
    Europe.  Letter dated October 3, 1994 addressed to Ing.
    Dominik Kocinger of the Slovak Government Commission for
    Gabcikovo. 

MTI Econews.  "Slovak-Hungarian Agreement on Water
    Replacement," April 19, 1995.  As provided by Lexis/Nexis.
    

Olszaski, Tadeusz. "Danube Dam Dispute: Accord in Deep Water,"
       The Warsaw Voice.  May 24, 1992.

Pearce, Fred.  "Rising water drowns opposition to Slovakia's
    dam,"  New Scientist,  July 16, 1994.  

Rich, Vera. "The Murky Politics of the Danube," The World
    Today.  August, 1993.

Schiller, Bill. "Draining the Danube," The Toronto Star. March
    30, 1993.

Shields, Michael.  "Hungary, Slovakia Seek End to Danube Dam
    Dispute," July 31, 1994.  As provided by Lexis/Nexis.

Sibl, Jaromir (ed.).  "Damming the Danube:  What Dam Builders
    Don't Want You to Know."  A critique of the Gabcikovo Dam
    Project prepared by Slovak Union of Nature and Landscape
    Protectors and Slovak Rivers Network.  April 1993.                     
    Bratislava.

Tam s. "Jaws on the Danube: Water Management, Regime Change and
    the Movement Against the Middle Danube Hydroelectric Dam,"
    in the International Journal of Urban and  Regional
    Research 17/3, (Oxford, 1993). 

Varadi, Emil.  "Hungary, Slovakia Sign Treaty on Sunday in
    Paris," March 17, 1995.  The Reuter European Business
    Report.  As provided by Lexis/Nexis.

Vodohospodarska Vystavba.  "The Gabcikov-Nagymaros Project:
     Part Gabcikvo and The Temporary Solution on the Territory
    of the CSFR-SLovakia." Bratislava.

World Wide Fund for Nature.  "WWF Reaffirms Concern About
     Gabcikovo Dam,"  Press release, October 4, 1994.  Gland,
    Switzerland.

                                    References




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