Six miles north of Lake Victoria, the Nile awakens, exploding into a cauldron of white water known as the Bujagali Falls. Offering some of the world's most spectacular rafting, it is one of Uganda's top attractions. Soon it will be destroyed.

After 13 years of seeing plans delayed by corruption allegations, financial strife, obdurate spirits and opposition from environmental groups, Uganda last week authorised an international consortium to begin a 30-metre-high dam across the Nile just below Bujagali Falls.


The $800m (£400m) hydropower project - the biggest-ever foreign investment in east Africa - will flood the rapids and, according to critics, leave the country dangerously exposed to an energy crisis if predictions of global warming are realised. But the government and the World Bank, which is backing the project with $360m in loans and guarantees, insist that it is crucial to the country's development. "When the dam is finished [in 2011] we will be rid of the darkness," said Daudi Migereko, Uganda's energy minister, at the ceremony to approve construction.

In Uganda, where only one in 20 households has access to electricity, nobody doubts that desperate measures are required to solve the chronic power shortage. Even in the energy ministry, lights are often off. Factories have had to cut back production and lay off workers, slowing economic growth. In the capital, Kampala, which hums with the sound of generators, streetlights have been fitted with wind-turbines and solar panels to ensure they are not redundant.