Damming Belize.

Belize's western mountains are an ecotourist's dream: a largely uninhabited region of dense tropical forests, wild rivers, cave complexes, Maya ruins and bountiful wildlife. While many of its Central American neighbors were clearing forests to make way for slash-and-burn agriculture, Belize has been making far more money keeping the trees in place. Today tourism--almost all of it nature-based--accounts for a fifth of the nation's economic activity and employs a quarter of its workforce. The mountainous Cayo region is one of the main draws.

But Belize's government is dead-set on building a dam on the upper Macal River, smack in the heart of Cayo. The $30 million Chalillo dam will flood 2,800 acres of tropical forest that is home to jaguars, ocelots, tapirs and the country's only known flock of the rare and colorful scarlet macaw. "This is the prettiest river in the country," says Mick Fleming, who owns the Chaa Creek Lodge, an ecotourism resort set in the jungle 20 miles downstream from the dam site. "We're going to lose something incredibly valuable in return for an extremely small amount of power."

Plenty of people in Cayo agree with Fleming's assessment. The city council in the district capital, San Ignacio, opposes the dam, and the vice mayor testified against the project during an unsuccessful attempt to block construction brought before the Privy Council in London last year. T-shirts and banners bearing such slogans as "The Macal is Ours" are seen all over town. "We use the river for drinking and swimming and tourism and canoeing," explains San Ignacio hotel owner Maria Preston. "The river is everything for us."

Belize is extremely short on electricity, but it's unclear whether Chalillo is the best way to meet the shortfall. Fortis Inc., the big Canadian company that will build, own and operate the $30 million dana, says it will double generating capacity on the Macal River.

"We believe hydroelectricity is the most environmentally friendly type of energy out there and the most cost-effective for Belize," says spokesperson Donna Hynes.

But while the dam will substantially boost domestic electricity production, most of the power will be generated at times of day when it is more expensive than importing it from Mexico. A 2000 study by the California-based Conservation Strategy Fund estimated the project would be a net drag on the Belizean economy. The dam is also being built near an active fault line, and Fortis admitted that it mischaracterized the geological properties of the site.

"This a bad project all the way around," says Grainne Ryder, policy director of Probe International in Toronto, which has led a campaign against Chalillo in Canada. "Fortis may make a quick profit out of it, but Belizeans will be left with the real costs for generations." CONTACT: International Coalition to Save the Macal River Valley, www.stopfortis.org.