2004 is the first year when the Three Gorges Project entered Phase III Construction period. The indicator of each construction project exceeds the annual target and the progress of the huge project meets the set objectives.

The Three Gorges Reservoir area enjoyed rapid social and economic development in 2004. The total production output of the reservoir area increased by 13.1% in comparable price compared with that of 2003 and the industrial structure was under further improvement. Each economic sector of the reservoir area enjoyed steady fast growth with continuous rising of living standard. In addition, such work as resettlement of local residents, restructuring of resettled enterprises and environmental protection was conducted smoothly and the basic situation of public health was normal.

In 2004, the overall situation of natural ecological environment of the Three Gorges Reservoir area was basically the same as that of 2003. The climate was a little bit warmer with average precipitation. During the wet season, there was not any large scale and severe flood disasters. The amount of the fish fry of the "Four major home fishes" in the river flow continuously decline with relatively big cut down of colia mystus and eel fry. The overall water quality of major fishery waters was good. Due to the continuous agricultural restructuring, the arable land area and the total sown area were on continuous reduction. As a result, the proportion of commercial crops increasingly rose and that of grain crops on continuous drop. However, there was certain rise of slight earthquakes.

In 2004, water quality of the main and tributary rivers of the Three Gorges Reservoir area was dominated by Grade III standard. There were some algal bloom phenomena in return water areas in spring and summer. As a whole, the environmental quality of the construction area and resettlement area was quite good.

In 2004, a total of 246.63 million tons of industrial wastewater from 51 major industrial sources was directly discharged into the Three Rivers (the Yangtze River, Jialing River and Wujiang River) with major pollutants being COD, NH₃-N and cyanide. The total amount of wastewater from urban sewage draining outlets and sewage treatment plants outlets of the 26 administrative districts (counties) of the reservoir area reached 498, 516,300 tons with total phosphorus, BOD₅ and COD as major pollutants. Total amount of urban garbage reached 2.0008 million tons. 529,700 tons of oil containing wastewater from ships and boats were discharged into the waters, up by 25.8% compared with that of 2003. 94.9 percent of them had been treated. Cargo ships and passenger ships were the main polluting ships. There was an increase of the application amount of both fertilizers and pesticides in the reservoir area.