Development in them thar hills (is being the backdoor to China unquestionably a good thing?)
A couple of newswire pieces to comment on, the first, from a hotel point of view is a good thing - not only are we already an hour from the most picturesque gateway to the World Heritage site of Luang Prabang - the two day boat trip down the Mekong - the same gateway is set to become the back door to Yunnan, one of China's least discovered provinces, running all the way up to the Naxi 'Shangri-la' of Li Jiang and the Tibetan border.
Laos' powerful neighbours China and Thailand have built a highway between Chiang Khong and Luang Namtha - not yet open but "coming soon" - to "contribute to the economic development of Northern Laos" (one only has to read the Lonely Planet Thorntree website to see what form of development the Chinese section of the road has bought to the eco-tourism haven of Luang Namtha - worrying reports of floods caused by construction; deforestation for rubber for the big, suddenly accessible, market to the North; super Casinos and even the kidnapping of a prominent eco-tourism advocate). It is one of my favourite towns and I suggest, if you've ever had the urge, to get up there and see it now.
I feel the second sentence talking of facilitating links between (though the ADB says with) China and Thailand may be slightly higher on the agenda. The road will also make access easier for our guests to visit Luang Namtha and Muang Singh as well as China but at what cost? True I've not found anyone who liked the old 4WD track (130km took 10 hours at least) apart from me, but then I've always liked 4WD tracks and inaccessibility has always been the friend of Asian forests and Asian wildlife.
Build a road and the logging trucks come, the speculators come, business men local or foreign buy forest land for knock down prices - or not at all - plant cash crops and the land becomes theirs, the truckers need to eat and bushmeat is cheap and saleable by locals and don't think I need point out the other economic 'benefit' to families with daughters.
I am not anti-progress, I happily live in Thailand and take advantage of her excellent transport and communications system, her years of development (and very little natural forest), I am also an hotelier and am itching to help my guests further explore Yunnan from the wild elephants in Jing Hong right up to the Tibetan border. I am not in a position to preach against something that will make the lives of many Laos people much easier, but I do see that, if not implemented carefully, the transition of local people from a centuries-old way of life to the modern world in a matter of four years (when I first 4WD'd the road - only four years ago, I'm not an old hand! - village kids would run from the car, now they hold out their hand for money) can spell disaster for the poorer, voiceless locals and their forests and the wildlife contained within.
This is, after all, a conservation blog - and, to be honest, I don't see any care being taken to conserve.
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Laos First Highway To Open This Year
VIENTIANE, May 14 (Bernama) -- Construction of Laos's first highway will soon be completed, contributing to its economic development in northern Laos and facilitating economic, and commercial exchanges with neighbour countries of China and Thailand.
According to Lao news agency (KPL) on Monday, the 228-kilometre highway, a portion of a road running from Kunming of China through Lao northern provinces of Luang Namtha and Bokeo to Thailand, will be opened to traffic this year after three years' of construction.
The project was divided into three packages whereby the first received US$28 million from the Chinese Government for the building of a 67.7 kilometre portion, which will be put into use on May 23.
The second package provides for the building of 77 kilometre with a US$16.5 loan from the Asian Development Bank while the rest received 823 million Thai bath (US$26 million) for the building of 84 kilometres.
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...the link to the second piece is tenuous, I guess, and if I'm honest, really only got in because I was amused by the mis-translation (apologies to An Dien) of the title - surely that would be a tourist attraction - though the Bokeo forest through which the above mentioned road passes is home to several troupes of gibbons from a species once thought extinct (as well as tiger, leopards and intriguing tales of rhinos).
If we allow the forest to be cut down, hunted out, before it her depths are fully studied, who's to say there aren't the South East Asian versions of the dodo up there?
It sounds as though it may be too late for the Vietnam's Central Highlands but perhaps not for Laos' Northern forests.
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Elephants could join dodos in Vietnam central highlands
Thanh Nien Daily
There are only a few hundred elephants left in the area compared with thousands a century ago, the International Union for the Conservation of Nature and Natural Resources reports.
Dak Lak province, once a pachyderm haven, now has just 50 elephants, mostly in captivity.
Residents point out that the relentless illegal logging has robbed the elephants of their habitat and left them in a permanent state of agitation.
Besides, the animals are chained, preventing them from mating, spelling further doom for their numbers. They are not in great health to start with since their owners work them into the ground.
Residents in Gia Lai province's Nhon Hoa village are nostalgic about the elephants' heyday around 40 years ago when people were proud about the number of elephants.
The disappearance of the elephants has badly affected elephant-related cultural festivals in the region, they grumble.
Better late...
The Gia Lai and Dak Lak provincial administrations have begun to act to save the elephants from extinction.
They have called for using In Vitro Fertilization (IVF) and offering elephants private spaces to mate.
A Gia Lai-based tourism company has bought three elephants for VND50 million (US$3,100) and uses them to entertain tourists as a last-ditch effort to conserve the pachyderm.
But a long-term plan to protect and preserve elephants is yet to be chalked out.
Reported by Thien Truc - Translated by An Dien
...more from the better educated folks at New Mandala...
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A conduit of vulnerability or prosperity?
July 25th, 2007 Andrew Walker
In mid 1994 my wife and I set off north on the road that ran between Houayxai and Luang Namtha (northern Laos). Our objective was modest. We wanted to go to a weekly market held in a village just an hour or so along the road. The trip was uneventful. An hour was optimistic, but three hours was not unreasonable given the road conditions. Standing in the back of a truck with local villagers clutching home-made rifles (which reached to just beneath my chin) was disconcerting on a bumpy road, but we reached our destination without mishap.
The market was a small and desultory affair, selling mainly local forest products and dry goods from the stores on Houayxai. We spent a while wandering around the picturesque village (my memory is a bit vague on this and I can’t lay my hands on my notes right now – I think it was Ban Pong, a Lu village). We then asked when the truck would be returning, only to find that it had returned only 5 minutes after arriving. There would be another the next day.
Sleeping at the market was fine (but bathing in the river was not a pretty sight). The stall keepers were friendly and set us up with a mosquito net in one of the small bamboo shops. They fed us fried birds and sticky rice. And when we went to bed they regaled each other with funny stories about the odd questions and strange habits of the falang. The rats were noisy. All good fun.
Well, things are now changing along the road from Houayxai to Luangnamtha. (For some previous New Mandala commentary on this route see here and here .) In a recent contribution to Mekong Currents , Rosalia Sciortino provides a useful profile of recent developments and discusses some of the key social impacts occurring along the route. Here is an extract.
Entry Filed under: Laos
1 Comment Add your own
1. jonfernquest | July 26th, 2007 at 11:00 pm
“Resettlement plans have been carefully drafted, but past experiences warn that they may not be sufficient to ensure adequate compensation as agreed-upon standards are rarely applied, regulation on land tenure and titling is unclear, and malpractice in disbursements is rampant.”
In the age of the blog software, RSS news feeds, and news aggregators, there should be someway of getting locals to monitor incidents locally, and have reports with photos feed into and be integrated with larger-scale world human rights news feeds, so people can see the injustice and exploitation going on, if and when it happens.
Given that the these incidents are documented and made publicly available, there seem to be other issues: First, authorities in Laos being sufficiently responsive to these incidents and issues when they arise, assuming that they can, assuming that it isn’t some local power lord mafia like figure that the government has cut a deal to keep law and order in exchange for autonomy. The center doesn’t necessarily have control of abusive peripheries.
All of Matthew McDaniel’s old material, journals, logs, drill pretty deep into what was going on in Chiang Rai’s hinterland and are a good case study.
In Burma, Soros funding makes sure incidents make it to the media, but media overload is the result. Have you ever tried to wade through and make sense of the massive amounts of information coming out of all these grassroots organisations?
Also media overload breeds authorities unwilling to respond because they see external NGO monitoring as a usurpation of sovereignty. Isn’t the World Bank funding the roads? I don’t suppose human rights impact issues are be channeled through them as they arise. Seems like road building should have convenants in this respect with the government receiving the funding. But on the other hand, I remember how long (and the abandoned projects) it took to get a successful road from Mae Sai to Keng Tung (oral history of that road building project worth recording), and that road used to look like the road you’ve shown in the photo in places. I wonder how comparable the before and after situations will be along this new road?
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...for those of you interested in this subject and the rapid development of Northern Laos - the educated and well informed folks New Mandala have added a new thread.
It is a little confusing as to what is considered sustainable development and who is helping who and who is helping themselves - as doesn't directly affect eles (although any remaining wildies up there will have to be affected) I'll just point you in their direction and let you form your own opinions.
Life moves on for everyone, so anyone who does want to see this special part of the world before it becomes like the rest of the world, I will recommend you visit soon; for better, for worse, change is just around the corner.
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China rubber demand stretches Laos
By Brian McCartan
LUANG NAM THA, Laos - Chinese investments in rubber plantations in northern Laos will be ready for their first big returns in 2011, with nearly all the raw material scheduled for harvest then set to be exported to Chinese markets. What began as a modest way for upland Lao farmers to supplement their incomes has blossomed into a fast-expanding agro-industry, albeit one surrounded by mounting concerns of the lack of governmental regulation and controls.
Rubber exports are becoming big business in communist-run Laos, one of Asia’s poorest and most economically insular countries. Every province in the country, apart from Hua Pan in the northeast and Xieng Khuang so its south, had rubber plantations in place last year or plans to plant, according to the National Agriculture and Forestry Research Institute of Laos (NAFRIL). Almost all of the production is being driven by Chinese demand.
China is projected to consume 30% of world rubber production by 2020, with an annual need for 11.5 million tonnes of natural rubber by that year, after passing the United States as the world's largest consumer at 3.45 million tonnes, or 18.2% of total consumption, in 2002. At present it can only produce 4 million tonnes annually. Much of the demand is being driven by the country's booming automobile industry, where the number of vehicles is estimated to increase to around 200 million by 2020, from 10 million in 2005.
That demand is helping to drive up global prices. Rubber prices in Tokyo, up 8% this year, have increased more than threefold since 2001. Demand from China will rise 35% to 6.83 million tons by 2010, according to the China Rubber Industry Association, Bloomberg reports.
To meet its needs, China has become the largest investor in Laos, outpacing neighboring Thailand and Vietnam. Most of that investment has come in the agribusiness industry, in particular rubber. An individual with knowledge of the Lao rubber industry who requested anonymity reported that the Chinese accounted for an estimated US$20 million in investments in northeast Laos, out of a total $26 million invested.
Rubber cultivation is new to northern Laos, with the first plantation established in northern Laos in Hat Nyao village in 1994 by ethnic Hmong refugees who had fled to China during the Indochina War and later returned from exile with substantial rubber growing expertise. Major expansion of the crop began around 2002, with substantial foreign commercial interest making inroads into northern Laos in 2004. Today forest areas are being cleared in ever-expanding areas across the country to make way for new plantations.
Luang Nam Tha province in the northwest has the largest amount of total hectares under rubber cultivation, while plantations are sprouting up in other northern provinces such as Udomxai and Pongsali and especially in Bokeo, adjoining Myanmar, along the almost finished Route 3 that will connect southern China to northern Thailand. A 2006 survey by the Forestry Research Center found nationwide a total of 11,778 hectares was already under rubber tree cultivation, with a total of 181,840 ha in new plantations planned.
One knowledgeable source estimated that at present more than 10,000 hectares of rubber had been planted in Luang Nam Tha province, compared with 400 hectares in 1994 according to NAFRIL. The number of hectares in nearby Vieng Poukha, including a 3,000 hectares spread granted by the government to a Sino-Lao consortium, and Na Lae districts is also growing rapidly.
Lao farmers earn anywhere between US$6,000 and $8,000 per hectares per year from rubber growing, considerably more than they would earn through traditional rice farming, non-timber forest products and even eco-tourism. The average rubber plantation in 2006 produced 1,360 kilograms of latex per hectare for a profit of around US$880, according to NAFRIL. In comparison, rice yielded 1,500 kilograms per hectare for a profit of $146 and opium 8 kilograms for $903 profit.
Division of labor
This has made rubber cultivation very attractive to poor, previously subsistence Lao farmers. Rubber investment in Laos largely falls under three general schemes: individual farmers, farmer associations and rubber companies. Individual farmers who grow rubber generally provide all the inputs and labor themselves, seek out their own markets and bear all the risks if the crop fails or world prices fall. Most of these farmers in Laos have relatives on the Chinese side of the border who have invested in plantations, provide technical knowledge and help access Chinese markets. Generally these plantations range in size anywhere between three and 25 hectares.
Under the farmer association scheme, each farmer is contracted by an association based within the village to work a piece of land. The labor is shared and at harvest farmers are paid for the amount of rubber received from the land they worked, minus a fee to the association. Rubber companies operate under government concessions or on contract with individual farmers or farmer associations. The largest operations involve land concessions granted either through the Lao government or the army.
Rubber companies seeking concessions of under 100 hectares make agreements with district officials, while those over 100 ha are made with the provincial officials, though these concessions are sometimes guided by connections with government or army officials in Vientiane. All the inputs are provided by Chinese companies and local villagers are hired to work the land at an average of 20,000 Kip or US$2 per day. The companies pay a concession fee of about US$6 per hectare for the use of the land.
Another system has Chinese companies forging agreements with farmers or farmer associations, sometimes after establishing deals with local Lao authorities as to which villages they can work in. Under this contract-farming scheme, villagers plant and care for the crop under the supervision of a Chinese specialist. Seeds and other inputs, technical support and guaranteed markets are provided by the Chinese company. At harvest, the profits are generally split between the villagers and the company on a 30:70 ratio if some form of salary has been paid, or 60:40 if the farmers receive no salary and only provide land and labor.
Chinese investment, while bringing guaranteed markets, technical help and capital investment, comes with substantial downsides. One complaint is that land concessions granted by the government to Chinese companies are not always voluntary on the part of the farmers. Sources with knowledge of the situation claim that some of the land granted actually belonged to villagers who are simply told by the government or army that it now belongs to a Chinese company.
A general lack of land title deeds and the country’s communist system means that the exploited villagers have little if any legal recourse. In many cases, no compensation is paid by the government, although some villagers have been able to negotiate 10,000-15,000 Kip, or $1 to $1.60 per hectare from the companies. Although the villagers are allowed to work on what once was their land, they are only paid one-third of what a Chinese worker generally receives.
Chinese companies say that they are not completely to blame for the imbalances, arguing that they are only doing business and it is the Lao government that should be responsible for setting appropriate standards and controls. Rubber investment has been largely decentralized, with district and provincial authorities able to make deals without having to consult the central government.
This has reportedly allowed Chinese businesses with political or military connections to manipulate the system and some say has encouraged corruption among poorly paid local officials. Without a clear government policy and central control of investment procedures, rubber-related investments are almost completely unregulated.
At the same time, contracts agreed to with Chinese companies are often of little legal value, underscoring the risks to both sides. According to NAFRIL, contracts written by Chinese investors ''fail to meet any internationally recognized standards and are woefully inadequate by every measure''. Some are informally signed with no involvement by local authorities, while others are legally signed with the involvement of local authorities.
In both cases, the terms are often vague and without sound legal reasoning. Many of the farmers who sign the contracts have no real knowledge of the law and their rights. Indeed, many of the upland villagers are illiterate in the Lao language, much less Chinese. In some of the more egregious agreements, farmers have later learned that they in effect signed away their rights to their land for an extended period of time and cannot change to another crop if their rubber trees fail or world prices drop.
Flawed model
Although China’s experience with rubber cultivation is being used widely as a blueprint for rubber plantations in northern Laos, there are many glaring flaws in the Chinese model. Chinese rubber cultivation began in its southwestern Yunnan province in a protected environment, wherein markets were guaranteed and prices fixed. This is not the case in Laos, where the industry is not protected and markets guaranteed only as long as demand exists and high prices hold.
The Chinese model also shows the dangers of environmentally unsustainable practices. A 2005 report by the German Organization for Technical Assistance and Cooperation (GTZ), a non-governmental organization, found that rubber cultivation in Yunnan had resulted in severe erosion, which would severely affect the long-term ecological sustainability of the area.
According to environmentalists tracking the situation, growing and extensive mono-crop rubber cultivation in Luang Nam Tha will have other dire consequences. The loss of biodiversity due to the conversion of natural forests to rubber will cut harvests of non-timber forest products that so many villagers rely on. The Nam Tha and Sing river valleys will also likely experience a reduction in size and diversity, they say.
The Lao government has failed to provide technical help to farmers in line with the increase in investment in rubber plantations. Nor has there apparently been any official research conducted into rubber or into which varieties are best suited to the growing and climatic conditions of the country. All of the technical knowledge and inputs, including seeds, bud grafting material and tapping equipment come unregulated from China. This has quickly made Lao farmers highly dependent on Chinese inputs.
Nor have there been any substantive controls placed on the areas under rubber cultivation. The Land Use Planning and Land Allocation law was instituted by the Lao government to encourage farmers to protect land and use it more effectively through delineating land-use areas and village boundaries. The law, however, has not been effectively implemented or enforced in a majority of villages. One aspect of the law, which stipulates that land left fallow for more than three years reverts to community ownership, has resulted in farmers planting rubber on the land, whether it is suitable or not, simply to retain the land-use rights.
In some areas, protected areas and conservation forests are being encroached upon. In particular, the growth of rubber plantations has recently become a direct threat to the Nam Ha National Protected Area (NPA). The NPA, which spans 222,400 ha in Luang Nam Tha province, has been declared an Association of Southeast Asian Nations (ASEAN) natural heritage site and has become increasingly popular with globetrotting eco-tourists, with 49,258 arriving in 2005 and a projected 79,916 by 2013, according to the Lao National Tourism Administration.
Despite this, until recently there has been very little protection of the area against the breakneck expansion of rubber, which breaches Prime Ministerial Decree 164 issued in 1993 and the Forestry Law of 1996, which set forth that the purpose of the protected areas was to conserve biodiversity, protect watersheds, maintain ecological stability and protect the scenic beauty of the area for research and tourism. One source said he felt ''the NPA will be gone in 10 years'' due to growing rubber cultivation.
This year, the government instituted a modest program to better protect conservation areas. Teams from the Luang Nam Tha Provincial Agriculture and Forestry Department have been posted in three to four villages with the purpose of regulating the spread of rubber plantations, especially in the NPA. The impact of the teams will not be known for a few months. At the same time, the province is beginning to enforce better zoning and land use in some areas.
A prime ministerial order handed down in 2006 called for a moratorium on granting foreign land concessions. It is unclear what impact if any this has had since at least one Chinese company has since been granted land concessions in Muang Long district. Another prime ministerial order which in future might have more impact called for an increase in the number of people involved in forest protection.
The large amounts of money involved in the business argues against progress. The Lao Army and high level political leaders are known to have invested heavily in rubber plantations and grass roots dissenting views on the crop’s expansion are seldom, if ever, heard.
Brian McCartan is a Thailand-based freelance journalist. He may be contacted through brianpm@comcast.net.
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Work to start on Nam Tha 1 hydropower dam
The China Southern Power Grid Co Ltd (CSG) will begin work on an access road to the Nam Tha 1 hydropower project site in Bokeo province in March, acc ording to a project official.
The 40-km access road will run from Road No R3 road to the site in Pha-oudom district.
“We expect it will take about six months to build the road,” said the Deputy Manager of the Laos Project Department of China Southern Power Grid International Co Ltd, Mr Liu Jian, in an interview at the national consultation workshop on environmental and social aspects of the project on Friday in Bokeo province.
The road will be used to transport construction equipment to the site.
The company will start the construction of the main structures once the access road is complete, including the dam, powerhouse, spillway and diversion system for power generation.
Mr Liu Jian said the dam would take four years to build and energy generation would begin in 2012. The plant will have three energy generators with an installation capacity of 168MW.
The project includes the construction of a 115-kV transmission line with a length of 82km from the powerhouse to the substation in Huayxai district and another 115-kV transmission line 40kin in length from the powerhouse to another substation, in Luang Namtha province.
“The project will cost about 3.1 trillion kip (US$340 million),” Mr Liu Jian said.
The shareholders will be the CSG and the Lao government, with the company running the project for 30 years.
“The Lao government may hold a 15 to 25 percent stake but we don't know for certain yet because we have to wait and see the concession agreement,” Mr Liu Jian said.
The Deputy Head of the Water Resources and Environment Administration, Mr Sisavath Vitaxay, said Nam Tha 1 will represent an important power resource point in the power grid in northern Laos , and will meet the demands of local residents and the mining industry. It will supply mainly Bokeo and Luang Namtha provinces.
“We'll a lso be able to export electricity to Thailand ,” Mr Liu Jian said.
The dam will create a reservoir of 64 square kilometres to store about 17.55 billion cubic metres of water.
“It will flood 34 villages,” Mr Sisavath said.
The 34 villages include 10 in Pha-oudom district in Bokeo province and 24 in Nalae district in Luang Namtha province. These villages are home to 7,979 people in 1,397 families.
“We must make sure that everyone affected is resettled before the dam begins to store water in 2011,” Mr Sisavath stressed.
It will cost about 280 billion kip (US$32 million) to relocate the local residents, an amount already figured into the overall cost of the project.
By vientiane times
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HIGHWAY to PROSPERITY
Money, and people, are flooding into areas where roads connect four countries
Story by SUBIN KHEUNKAEW and THEERAWAT KHAMTHITA, Photos by SUBIN KHEUNKAEW
The R3A highway may not be familiar to many, but it is already touted as the road to economic prosperity for the region with China as the vehicle driving growth.
The modern highway links China, Laos and Thailand through the Thai-Lao bridge in Chiang Khong district.
The route is serving the massive movement of Chinese people and their communities, which are rapidly growing in Laos, as well as the northern parts of Thailand.
The Chinese government has signed a 50-year contract to rent areas in Boten city in Luang Namtha province on the Lao-China border to build communities, plush hotels, luxurious casinos, shopping and entertainment complexes.
Lao villages were relocated to make way for the development projects.
About 250 kilometres down the R3A route, vast areas in Houei Xai city in Bokeo province in Laos, opposite Chiang Rai's Chiang Khong district, have been earmarked to accommodate Chinese communities, marketplaces and tourist attractions.
The construction of the Thai-Lao bridge linking Chiang Khong to Houei Xai is expected to start in March next year.
Niwat Teeprueksa, coordinator of China-based Chei Chou International Co, said the company has a one-billion-baht project to build a five-star hotel, housing estates, golf course and tennis courts along the Thai side of the Mekong river bank. The project is only three kilometres from where the bridge will be built. The company is funded by a group of Chinese investors.
Mr Niwat said the investment would stimulate cross-border trade for Chiang Khong district, and it has been generating more than one billion baht over the past few months.
Another consortium of investors operating under the name Hong Yu Co also has development projects in the pipeline.
The company, with Dok Ngiew Kham Co as a subsidiary in Laos, has rented more than 10,000 rai of land in Tonphueng city, 10 kilometres from Houei Xai, under a 50-year-contract.
The development rush has triggered land sell-offs in some areas.
Somtes Buppha owns a six-rai plot of land near the Mekong river at Ban Don Mahawan in Chiang Khong district. He said land brokers had offered to pay him one million baht per rai.
"But I declined the offer and will never sell my land. I will build a restaurant on my land and start a home-stay business," he said.
Bualoy, a Lao who runs a tour company and a construction firm, said hotels, guesthouses and other accommodation are popping up in Bokeo province.
"By mid-February, a group of about 500 Thai tourists will stop over in the city before proceeding to Xishuangbanna using the R3A route," she said.
Sasithara Pichaicharnnarong, the tourism and sports permanent secretary, said tourist officials from 17 northern provinces will survey the R3A road, which was completed late last year, to try and find ways to boost tourism along the route.
"We will encourage tourist officials in these provinces to work in a proactive manner," she said.
She expects that over the next five to eight years countries in the Economic Quadrangle will receive up to 52 million tourists.
The permanent secretary urged the Thai government to prepare roads linking the R3A and R3B highways.
The R3A highway will link Chiang Khong district in Chiang Rai to Laos and China, while the R3B road will connect Mae Sai district in Chiang Rai to Burma and Laos.
He also called for direct flight connections to be opened between Kunming and Chiang Rai.
Businesswoman Pagaimas Viera, the owner of the Mekong Delta Travel Agency, has prepared tour buses to take the group of 500 tourists along the R3A and R3B routes to Xishuangbanna.
A source added she is planning a 300-room hotel to serve tourists on the border of Mae Sai district soon.
Local governments in Chiang Khong district are also adjusting to the fast-paced development.
Sommai Luangrob, chief of the Wiang tambon administration organisation (TAO), said a proposal has been floated to change the TAO into a municipality in response to the population growth and the increase in the volume of commercial developments in the area when construction of the Thai-Lao bridge is finished in 2011.
" More than 100 million baht will be poured into the area," he said, explaining more land will be bought to build a new municipal office to handle matters related to the booming trade.
And it is certain that local politicians will fight hard to control the levers of power in the new administrative body blessed with a huge budget.
However, with new developments come the fears of age-old problems such as trade fallout and environmental degradation.
Boontim Tipprasong, president of the Mae Sai chamber of commerce, is concerned that the projects will be detrimental to the environment. He also admitted that areas in Chiang Saen district have been dominated by Chinese businessmen and the influx of low-priced agricultural products from China under the Thai-Chinese free trade agreement has adversely affected the province's agricultural sector.
Chiang Rai governor Preecha Kamolbutr said the frequent change of provincial governors has been blamed for a lack of continuity in pursuing local policies, including trade development.
"We have to do our best to protect the cultural and natural assets against the impact of fast-paced developments," he said.
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Southeast Asia
Feb 2, 2008
Fear of foreigners in Laos
By Bertil Lintner
LUANG PRABANG, Laos - It is has been one year since Sompawn Khantisouk was abducted by men believed to be local police officers. The whereabouts of the entrepreneur, the owner and manager of a small eco-tourism lodge in northern Laos, are still unknown - indeed, no one other than his abductors even knows if he is still alive.
Many at the time assumed he was taken away as punishment for trying to mobilize local villagers in the area against Chinese-sponsored rubber plantation projects....
(full article... http://www.atimes.com/atimes/Southeast_Asia/JB02Ae01.html)
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Asia Times 2/2/08 The following is a long backgrounder by Bertil Lintner long time Asia Watcher and writer for the Asia Times.
Best quote, "Aloon Dalaloy, vice governor of Luang Nam Tha, is reported to have told a public gathering in the province last year that "we are still fighting the revolution, not against the enemy's bombs and guns, but the Americans and the Christians are still our enemies." "
Don't be wearing any crosses or crucifixes around your neck, likely enough you'll be eaten alive after denunciation as a capitalist roader.
http://www.lonelyplanet.com/thorntree/thread.jspa?threadID=1553991&tstart=0
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Feb 9, 2008
Pawn Still Gone
Pawn a local advocate of environmental protection and sustainable tourism
I think some background is in order.
Just about a year ago the co owner of the Boat Landing Guest house in Luang Namtha disappeared while enroute to an appointment with the police to discuss the recent attempted arson of his eco lodge by unknown parties. Nothing was heard from him since.
I, like many other people who didn't know him, and weren't intimately familiar with the local situation in Luang Namtha, could imagine many scenarios where he might have had conflicting interests with rubber plantation developers, loggers, the government agencies carrying on relocation of upland peoples on a massive scale, or more mundane private matters, loss of face, jealously, who knows what.
Bertil Lintner the writer of this artical has a long and very good reputation for reporting on Burma, North Korea and other reclusive regimes of East Asia. One would have to assume he has good sources in this case. Mr. Lintner is the only public new news from a reputable source I've seen since the incident first occured.
Asia Times
Southeast Asia
Feb 2, 2008
Fear of foreigners in Laos
By Bertil Lintner
LUANG PRABANG, Laos - It is has been one year since Sompawn Khantisouk was abducted by men believed to be local police officers. The whereabouts of the entrepreneur, the owner and manager of a small eco-tourism lodge in northern Laos, are still unknown - indeed, no one other than his abductors even knows if he is still alive.
Many at the time assumed he was taken away as punishment for trying to mobilize local villagers in the area against Chinese-sponsored rubber plantation projects. Now it seems more likely that Sompawn was victim to a new and pressing dilemma facing one of the world's last remaining communist-ruled countries: how to balance rapid market-driven economic growth with the strict
social controls that the Lao People’s Revolutionary Party has kept in place since it assumed power in 1975.
Sompawn ran the famous Boat-Landing resort, which is mentioned in most foreign guide books to Laos and had won several awards for its contribution to environmentally sound sustainable tourism. Eco-tourism promotion is even listed as one of the Lao government's five main development priorities, along with hydroelectric power, construction materials, agriculture and mining.
Last July, Laos hosted an Ecotourism Forum, which brought together tour operators, travel agents, hoteliers, development agencies and government authorities from throughout the Mekong river region. Those efforts have won significant international plaudits, including a New York Times survey that recently ranked Laos as the world’s top adventure tourism spot in 2008.
At the same time, there are entrenched official fears about growing foreign influence in the country, particularly in remote rural areas. Sompawn's partner was an American citizen and the country's security agencies were reportedly not pleased to see a foreigner help run the successful business. At about the time Sompawn disappeared, his American partner left the country and has not since returned.
Soon thereafter, at least two foreign non-governmental organizations (NGOs) were ordered out of Luang Nam Tha, the province where the Boat-Landing is located. Other, lesser-known operators of small local businesses with foreign links were threatened with expulsion or stricter supervision of their activities, according to sources in northern Laos.
"On the one hand, the government welcomes the foreign revenue from tourism, while on the other it fears the security implications of allowing tourists to wonder at will around the country," wrote Song Kinh, an article published in the Irrawaddy news magazine. Officials overseeing the fast-growing tourism sector tend to be somewhat more accommodating to foreigners, while security personnel are less so.
The latter are particularly suspicious of foreign-run NGOs, many of which work to empower local communities by teaching them basic democratic principles and which security officials see as a challenge to the authority of the ruling Lao People's Revolutionary Party, the country’s only political party. While Sompawn's local business was not an NGO, many of its tourism activities were done in close consultation with local communities.
Foreign devils
As a legacy of wars in the 1950s, 1960s and 1970s, first against the French and then against the US in what the Lao government refers to as "the 30-year struggle", the country's communist rulers remain wary of foreign influences. For instance, some of the NGOs that have been targeted for harassment are known to have had Christian connections.
While the vast majority of the country's lowlanders are Buddhist, Christianity has made inroads in the highlands, home of several ethnic minorities that have a long history of resistance to integration into mainstream Lao society. There are historical reasons for their squeamishness. During the Indochina conflict, thousands of Hmong tribesmen - although ostensibly part of the then Royal Lao Army - were armed and equipped by the American Central Intelligence Agency to fight the communist Pathet Lao, which, in the end, emerged victorious in the war.
Then American Christian missionaries worked more or less openly for the CIA, among them the legendary Edgar "Pop" Buell, an Indiana farmer who was assigned to the Xieng Khouang area in and around the Plain of Jars, where he came into contact with the Hmong. Later, he became the principal contact man between the CIA and the Hmong, working closely with the Hmong warlord Vang Pao, who escaped to the US before the communist takeover in 1975, and, despite his now advanced age, has continued to campaign against the country's communist rulers.
In June last year, the authorities in California arrested him on charges of masterminding a plot to overthrow the Lao government with arms and equipment that were ready to be shipped to Thailand. Eight others were also arrested and charged with violating the federal US Neutrality Act, among them a former California National Guard, Lieutenant Colonel Harrison Ulrich Jack, a 1968 West Point graduate who was involved in covert operations during the Vietnam War.
The other seven were all Hmong from Laos who had been resettled in the US after the end of the war. The criminal complaint said Vang Pao and the other defendants plotted an insurgent campaign, "by violent means, including murder, assaults on both military and civilian officials in Laos and the destruction of buildings and property". In July, he was released on bail.
However, the events in California had repercussions in Thailand, where in a bid to ease bilateral tensions the government announced that it would repatriate thousands of Hmong refugees back to Laos. Now totaling about 8,000, their numbers have swelled in recent years due to fresh arrivals, indicating that all is not well in the Lao mountains. Although the Hmong insurgency, which simmered on throughout the 1980s and into the 1990s, is now more or less over, there are reports of occasional skirmishes and ambushes involving hill-tribe bands, mostly in the area around Phou Bia mountains south of the Plain of Jars, and near the town of Kasi on the main road between Vientiane and Luang Prabang.
With the revelations of a Vang Pao's latest plot, the already paranoid security authorities in Laos may have seen a broader US conspiracy in the eco-tourism joint venture they broke up with Sompawn's abduction and the US citizen fleeing the country. They may also have read with some suspicion the US State Department's International Religious Freedom Reports, which frequently mention "abuses of citizen's religious freedom" in Laos, especially arrests of Christians and actions taken against the independent Lao Evangelical Church (LEC). The 2007 report mentions closure of LEC-affiliated churches and the detention without charges of local Christian community leaders.
Costly xenophobia
With that bad publicity, the security authorities seem to believe that remote provinces such as Luang Nam Tha are better cleansed of foreign, especially Western, influences. Wealthy Chinese tourists to the newly opened casino on the Lao side of the frontier at Boten bring in only money, not new potentially destabilizing ideas about human rights and democracy, so they remain welcome. Aloon Dalaloy, vice governor of Luang Nam Tha, is reported to have told a public gathering in the province last year that "we are still fighting the revolution, not against the enemy's bombs and guns, but the Americans and the Christians are still our enemies."
Such rhetoric, of course, overlooks the more pressing national challenges the transition to a free-market economy represents. As the Lao economy continues is rapid expansion, with gross domestic product growth up over 7% in the past two years, there is an acute and growing shortage of skilled labor. And there is no remedy in sight, unless the government moves to employ more outside experts. In a paper dated December 14, 2007, the Asia Foundation pointed out that Laos has only one university, which opened only 11 years ago. Prior to that, students were sent to the Soviet Union, Bulgaria, Poland and other Eastern Bloc countries for higher education, but that training is often irrelevant to the country’s current human needs.
When the National University of Laos enrolled its first class in 1996, there were just over 8,000 students. Today there are nearly 27,000 at the university, but, the Asia Foundation says, the shortage of human and economic resources poses constant challenges and most faculty members have no degree beyond bachelor's level. With the country's few skilled professionals opting to work in better-paying foreign-led private enterprises, according to the Asia Foundation, it is hard "to imagine how departments like engineering, natural sciences and business will be able to keep their best and brightest teachers, all but eliminating the mechanism for building a future generation of capable Lao professionals".
That means the Lao government can either dramatically raise the salaries of professors and technocrats, or employ more foreigners to fill the gaps - and hope that foreign donors will pay for their much higher expatriate salaries. But that also means more foreign influences, not only in sectors like ecotourism and small-scale rural development schemes but in central government institutions as well. That arguably would pose an even graver threat to central control than foreign-managed eco-tourism resorts or NGO and missionary activities in politically sensitive highland areas.
The ruling Lao People's Revolutionary Party has arrived at a crucial crossroads and the direction pursued will likely make or break its still tentative economic reform experiment. Clearly there are still elements in the party who are reluctant to change their repressive ways, accept new social and economic realities and move the country forward.
Sompawn’s arrest and disappearance is testament to that inertia. But with the country's greater integration into the global economy, party officials will sooner or later have to face the fact that even landlocked Laos cannot remain insulated from foreign influences.
Bertil Lintner is a former correspondent with the Far Eastern Economic Review, for which he wrote frequently on Lao politics and economics. He is currently a writer with Asia-Pacific Media Services.
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Sompawn Khantisouk shown here with his family. Photo contributed by Jim Harris
February 25, 2008
Jim Harris' Project Laos Blog
Vientiane
Laos People’s Democratic Republic
There has been a lot of whispered conversation about Sompawn Khantisouk. Everybody I know who has ever worked with Pawn or befriended his family says the same thing. They all hope that, despite the dwindling odds, he will turn up alive.
The Boat-Landing Guest House, the eco-tourism resort in Luang Namtha Province that Pawn owns and manages, has been praised by the Lonely Planet and other travel guides to Southeast Asia. Most travelers familiar with northern Laos consider the Boat-Landing a flagship enterprise, clearly the regional leader in promoting ecologically sensitive tourism.
Pawn and Bill Tuffin, his American business partner, have built a solid reputation among an ever-widening community of travelers questing after “green adventure.” Their resort consists of a restaurant and several bungalows built entirely of locally available materials that nestle harmoniously among towering trees in a peaceful, riverside setting. The resort eschews non-recyclables and minimizes consumption of water, dry plant material and firewood. It’s a cozy place that leaves just a tiny carbon footprint. I’ve been a guest at the resort myself and can attest to the beauty of the lodge and the serenity of its location.
The resort’s knowledgeable staff offers guests entree into the wilds of northern Laos, through activities such as trekking, rock climbing, mountain biking, rafting and kayaking. Luang Namtha Province, once renowned mostly for its opium dens, has slowly transformed its reputation into a locale where visitors can find wholesome recreation or adventure.
For Pawn and Bill, promoting eco-tourism became one with encouraging respect for the natural environment of the province. It goes without saying that travelers attracted to a place like the Boat-Landing want to see triple canopy forest, not rubber tree plantations; they want to return home with memories of clean, wild rivers, not streams choked with mining silt.
About a year ago, Pawn was snatched up by several men, hustled into a waiting car, and driven away. Since that day no one has seen or heard from Pawn and only his abductors know his fate. His American business partner departed Laos soon after Pawn’s disappearance and has not returned.
No one knows for certain who had Pawn abducted. Some think it was economic interests that conflicted with eco-tourism. Those people think hired thugs did the job. Others think his abduction had official sanction; they even say that witnesses to the abduction recognized local police officers.
Old hands here in Lao who pride themselves on being able to interpret events usually sum up Pawn’s plight in a single word: “Re-education”, implying that he now probably languishes in the Lao Gulag, doing hard labor on scant provisions, serving an indeterminate sentence handed down without benefit of trial.
Ironically, the kind of tourism that the Boat Landing promotes was supposed to have official support and encouragement. The Lao government is on record as identifying “eco-tourism” as one of five major development priorities, the others being hydroelectric power, construction materials, agriculture, and mining (strange bedfellows for green tourism but then, I didn’t create the list; the Lao government did).
Pawn’s father, wife and children still depend upon the resort for their living, as do local villagers who work at the lodge or guide activities. The family has managed to keep the place up and running. Thankfully, guide books still taut the Boat Landing as a peaceful retreat and encourage travelers to visit; most guest arrive with no knowledge of the tragic events that have befallen Pawn, Bill, and the people they left behind.
I wonder about the fate of environmentally sensitive tourism in Laos if the people who lead that movement are made to live in fear that their efforts might bring down the wrath of competing economic interests. How can it happen that a star in the field of eco-tourism, lauded not only by visitors but by the Lao government itself, can be made to suffer such hardship? And finally, the most immediate question: “Where is Sompawn Khantisouk?”
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Oli saw this story on the BBC News website and thought you should see it.
** Vietnam 'hub for illegal timber' **
Vietnam has become a major South-East Asian hub for processing illegally logged timber, a report says.
< http://news.bbc.co.uk/go/em/fr/-/1/hi/sci/tech/7302732.stm >
___________________________________
The trade threatens some of the last intact forests in the region, say the UK-based Environmental Investigation Agency (EIA) and Indonesia's Telapak.
Because Vietnam has increased measures to protect its own forest, producers are getting timber from other nations.
The authors add that some of the timber is reaching the UK as garden furniture.
"Over the last decade, governments around the world have made a raft of pronouncements regarding the seriousness of illegal logging and their determination to tackle it," the authors of the Borderlines report say.
Head of forest camaigns, EIA
"Yet the stark reality is 'business as usual' for the organised syndicates looting the remaining precious tropical forests for a quick profit."
The report says that an increase in the price of raw timber has prompted some wood producing countries, such as Indonesia, to take steps to combat illegal logging.
But, they explain, as tougher measures were enforced by one country, the problem shifts to another.
Uncertain future
EIA and Telapak say they have gathered evidence that "Vietnam is now exploiting the forests of neighbouring Laos to obtain valuable hardwoods for its outdoor furniture industry", which contravenes Laotian laws banning the export of logs and sawn timber.
They add that they also obtained evidence that timber traders from Thailand and Singapore were also securing raw materials from Laos.
"The cost of such unfettered greed is borne by rural communities in Laos who are dependent on the forests for their traditional livelihoods," said EIA's head of forest campaigns, Julian Newman.
"They gain virtually nothing from this trade; instead, the money goes to corrupt officials in Laos and businesses in Vietnam and Thailand."
The authors estimate there are about 1,500 wood processing enterprises in Vietnam with a total processing capacity of more than 2.5m cubic metres of logs a year. They believe outdoor furniture accounts for about 90% of the country's total wood exports.
Although the Vietnamese government has been tightening controls on logging since the early 1990s, it is also encouraging the wooden furniture industry to expand.
EIA said the nation had relaxed regulations concerning ownership in order to facilitate foreign investment, and it was also actively promoting the sector in overseas markets.
Mixed message
The groups said that ultimate responsibility had to rest with western markets that imported products made from the uncertified timber.
"Until these states clean up their act and shut their markets to wood products made from illegal timber, the loss of precious tropical forests will continue unabated."
The team found that many leading brands and retailers had "taken the necessary steps" to ensure that certified and legal timber was used in products they sourced from Vietnamese producers.
But researchers, posing as furniture buyers, found that a number of companies operating in the UK had failed to take the appropriate measures to ensure illegal timber was not entering the country.
Stemming the flow
In an effort to prevent illegal timber entering its borders, the EU developed an initiative called Forest Law Enforcement, Governance and Trade (Flegt) in 2003, aimed at forming partnerships with timber producing countries.
The scheme is underpinned by Voluntary Partnership Agreements (VPAs), which involve establishing a certification system to ensure only legally sourced timber enters EU markets.
EIA says the system focuses on direct shipments from the country, and does not take into account the fact that raw timber can pass through several countries, eg from Laos into Vietnam.
"Another problem with VPAs is that end products such as furniture are currently not included on the list of timber categories to be controlled," the report says.
Gareth Thomas, the UK's International Trade and Development Minister, said the report raised a number of concerns.
"Through the EU, we will be raising this with the Vietnamese government. I personally will be raising this with my Vietnamese counterpart," he told BBC News.
"We will explore with G8 colleagues whether there is G8 action we can take in this area."
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March 31, 2008
In Isolated Hills of Asia, New Roads to Speed Trade
By THOMAS FULLER
LUANG NAMTHA, Laos — The newly refurbished Route 3 that cuts through this remote town is an ordinary strip of pavement, the type of two-lane road you might find winding through the backwoods of Vermont or sunflower fields in the French provinces.
But On Leusa, 70, who lives near the road, calls it “deluxe.”
As a young woman she traded opium and tiger bones along the road, then nothing more than a horse trail.
On Monday, the prime ministers of Cambodia, China, Laos, Myanmar, Thailand and Vietnam will officially inaugurate the former opium smuggling route as the final link of what they call the “north-south economic corridor,” a 1,150-mile network of roads linking the southern Chinese city of Kunming to Bangkok.
The network, several sections of which were still unpaved as late as December, is a major milestone for China and its southern neighbors. The low-lying mountains here, the foothills of the Himalayas, served for centuries as a natural defensive boundary between Southeast Asian civilizations and the giant empire to the north. The road rarely follows a straight line as it meanders through terraced rice fields and tea plantations.
Today, those same Southeast Asian civilizations alternately crave closer integration with that empire and fear its sway as an emerging economic giant. China, in turn, covets the land, markets and natural resources of one of Asia’s least developed and most pristine regions.
With trade across these borders increasing by double digits every year, China has helped construct a series of roads inside the territory of its southern neighbors. The Chinese government is paying half the cost of a bridge over the Mekong River between Laos and Thailand, due for completion in 2011.
It financed parts of Route 3 in Laos and refurbished roads in northern Myanmar, including the storied Burma Road used by the Allies in World War II to supply troops fighting the Japanese. China is also building an oil and gas pipeline from the Bay of Bengal through Myanmar to Kunming.
Taken together, these roads are breaking the isolation of the thinly inhabited upper reaches of Laos, Myanmar and Vietnam, areas that in recent decades languished because of wars, ethnic rivalries and heroin trafficking. The roads run through the heart of the Golden Triangle, the region that once produced 70 percent of the world’s opium crop.
The new roads, as well as upgraded ports along the Mekong River, are changing the diets and spending habits of people on both sides of the border. China is selling fruit and green vegetables that favor temperate climates to its southern neighbors, and is buying tropical fruit, rubber, sugar cane, palm oil and seafood.
“You never used to see apples in the traditional markets,” said Ruth Banomyong, an expert in logistics who teaches at Thammasat University in Bangkok.
China has blasted shallow sections of the Mekong to make it more easily navigable for cargo barges, allowing traders to ship apples, pears and lettuce downriver. The price of apples in Thailand has fallen to the equivalent of about 20 cents apiece from more than a dollar a decade ago. Roses and other cut flowers from China have displaced flowers flown in from the Netherlands, making Valentine’s Day easier on the wallet for Thais. Traders now have the choice of shipping by barge, truck or both.
Overall, even before the completion of the road, trade between China and the upland Southeast Asian countries Cambodia, Laos, Myanmar, Thailand and Vietnam had risen impressively, to $53 billion in 2007 from just over $1 billion a decade ago.
People are on the move as well. Wang Suqin, the director of express services at the Kunming bus terminal, says Chinese tourists are eager to travel overland to Thailand.
“Every day we receive calls about this,” Ms. Wang said.
Bus service to Bangkok, which has not yet started, will take at least 24 hours, but that is not a deterrent, Ms. Wang says; it is part of the fun. “We don’t want to miss the scenery along the way,” she said.
During a weeklong journey through the cities and villages along the route from Kunming to Bangkok, rice farmers, tea pickers, businessmen, traders and government officials expressed satisfaction and some excitement that a project decades in the making was nearly completed.
Chen Jinqiang, a Chinese government official from Xishuangbanna in Yunnan Province, said the road would help ensure that farmers get their vegetables and flowers to market, avoiding a problem he witnessed in the 1980s, when poor transportation left watermelons rotting in the fields. “Even the pigs refused to eat them,” he said.
But the road also excites old fears of the monolith to the north. Preecha Kamolbutr, the governor of Chiang Rai Province, in northern Thailand, said it might exacerbate what he calls a “Chinese invasion.” He is particularly concerned for Laos, he said, an impoverished country the size of Britain but with a population of just 6.5 million.
“Chinese businessmen come in with their own capital, their own workers and their own construction materials,” the governor said. “I fear that in the future the Lao people might feel that they’ve been exploited. They will feel they’ve been invaded.”
For now, those fears do not appear to be shared by many Laotians. Residents of the sparsely populated Luang Namtha Province said they welcomed visitors and were counting on an influx of Chinese, Thais and others to help raise their incomes.
Alinda Phengsawat, the head of tourism planning in the province, said the road would bring visitors to what has been a very remote part of the country.
“Maybe they will stay overnight,” she said. “That would be better than just driving through.”
Since paving was completed late last year, people who live deep in the jungle have come to the edge of Route 3 to sell vegetables and forest products, residents say.
“You have a huge hinterland that’s pretty badly served at the moment, from Kunming down through Laos and northern Thailand,” said John Cooney, director of the Southeast Asia infrastructure division at the Asian Development Bank, which financed one section of the road in Laos. “That suddenly is becoming a market.”
Cash-strapped Laos is encouraging Chinese investment by handing out what it has plenty of: land. Deputy Prime Minister Somsavat Lengsavad has said the government will trade “land for capital.”
The government recently gave a Chinese company a 50-year renewable lease for a large swath of prime land outside the capital, Vientiane, in exchange for the building of a sports stadium. Here in Luang Namtha, a Chinese company has been given 30-year rights to build and operate what is being called, perhaps euphemistically, the Bo Ten Economic Development Zone.
The main draw so far is not the factories or warehouses typically associated with these zones but a casino, which is off limits to Laotian gamblers, according to Ms. Alinda.
“I went up there and everyone was speaking Chinese,” said Pansak Gardhan, a Thai engineer who is helping rebuild the small airport in Luang Namtha. “All the signs were in Chinese.”
Chinese coming here to gamble will drive through what is probably the most beautiful section of the Kunming-Bangkok road, a four-lane highway that soars over valleys and clings to hillsides striated with rubber-tree and tea plantations.
Li Hui, an official in the foreign affairs office of Yunnan Province, which borders Laos, says one segment of the journey from Kunming to the border used to take three days. “Half of the people were throwing up,” Mr. Li said. On the new highway the same segment takes only a few hours.
The Chinese spent $4 billion building the highway from Kunming to the border. One particularly difficult stretch of road required the construction of 430 bridges and 15 tunnels. That portion of the road is also monitored by 168 cameras centrally controlled by highway department officials who watch for elephants — there are an estimated 275 in the area — and other stray animals. The cameras also assist the police in catching suspected criminals.
“We’ve helped solve 130 cases of drug smuggling, robberies and murder,” boasted Zhang Zhulin, director of the Chinese segment of the expressway, which opened in April 2006.
In a large room with a “Keep Out!” sign posted at the entrance, Mr. Zhang toggled a joystick to show how he could scan different segments of the road as well as zoom in on the faces of passengers as cars passed through toll booths.
The Kunming-Bangkok road is not a seamless experience. There are sections on the Chinese side that have yet to be upgraded. With the bridge over the Mekong still in planning stages, passengers must take ferries across the Thailand-Laos border. And formalities at border checkpoints, especially for freight, can sometimes take hours.
But the road is an obvious improvement from the one Ms. On knew as a child. Her son drives her around in his Toyota pickup truck, but she is not interested in going very far. “I get carsick,” she said.
Copyright 2008 The New York Times Company
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Shaking up the neighbourhood
A new road through Laos is changing the way Thailand relates to China, write SONGPOL KAOPATUMTIP and SIRIPORN SACHAMUNEEWONGSE
The Asian Development Bank (AD
has supported the development of transportation routes linking China, Burma, Laos, Vietnam, Thailand and Cambodia since the Greater Mekong Subregion (GMS) was established in 1992. Route 9 connecting Thailand, Laos and Vietnam has been completed. A stretch of Route 3 from the southern Chinese border village of Boten to the Lao border town of Houei Xai, opposite the northern Thai border town of Chiang Khong in Chiang Rai province, was officially opened on March 31. (See map)
The journey from Boten to Houei Xai on the old mostly dirt road took as long as two days. With the new roadway, the trip takes only five to six hours. For its part, Thailand is planning several infrastructure projects, including a new bridge linking Chiang Khong with Houei Xai. Once completed, the bridge will connect Kunming, the capital of southwestern Chinese province of Yunnan, with Bangkok via a 1,855-kilometre highway, which will be connected to the road network in Malaysia and Singapore.
Acknowledging the importance of this new trade route, the Thai-Chinese Chamber of Commerce (TCCC) has urged Thai businessmen to tap into this new potential for economic growth.
"Chiang Rai will benefit the most in terms of trade, investment and tourism," said TCCC chairman Tanakorn Seriburi. "It can be the hub for Chinese tourists, who will not only travel in Thailand but around the region."
He foresees greater Thai-Chinese joint investment in long-term projects, including food processing and gem and jewelry business. A northern industrial park may also be set up with investors from China, he told a seminar in Bangkok in March.
"China is a fast-growing economy and its people are going abroad to further their studies and broaden their visions," said Tanakorn. "This is a new China that we must deal with."
As a matter of fact, the value of trade between China and Thailand has been increasing over the years. According to records of the Information and Communication Technology Centre and the Customs Department, the value of trade in goods between Thailand and China was 816 billion baht back in 2005.
With the value of imported items from China almost reaching 448 billion baht by the end of 2005 and exceeding 367 billion baht in exports from Thailand the same year, Thailand incurred a trade deficit to China by 81.5 billion baht in 2005.
Interestingly, by the end of 2007, the trade value between China and Thailand had exceeded a trillion baht.
However, with imports of 564 billion baht coming in from China and over 510 billion of exported items taking off from Thailand in 2007, the trade deficit for Thailand had decreased from that in 2005, but was still at a noteworthy 53 billion baht. (See chart)
The main export items from Thailand have been automatic data processing machines, rubber, polymers, refined fuels, crude oil, chemicals products, rice and tapioca products, whereas the top imported items from China have been computer parts and accessories, electrical machinery, iron and steel products and other metal ores and scraps, household appliances, chemicals, fertiliser and pesticides, fabrics and manufactured articles.
Roads to change
Professor Sompop Manarungsan, an economist at the Faculty of Economics, Chulalongkorn University, considers that in economic terms, the new Route 3 will be beneficial in at least three ways.
Firstly, it will encourage market expansion across the borders, considering the improved logistical framework. "Up to now, the main mode for transporting goods in the region has been via the Mekong River," he says, noting that vegetables from China are shipped along the river into Thailand, whereas exports from Thailand are shipped to Guangdong in China, from where they are transported to Kunming and other cities in Yunnan. "With the new road, cost and time incurred on logistics will be reduced in favour of door-to-door logistics."
Secondly, the development will also boost investments in the region, he said, noting that Chinese investors have already started acquiring land in Laos, on lease terms of 99 years, for commercial and real estate projects, as well as for building new entertainment complexes and casinos. "Investors from Korea, Singapore, Malaysia and Japan are already giving more attention to the area, which was initially considered a marginal area with few business opportunities, but is now more accessible," said Prof Sompop.
Thirdly, the road link will allow for more opportunities in the services sector. For example, tourists who initially travelled along the Mekong River to experience the inland destinations of the region would enjoy the improved transportation, and considering how the area is still exotic, tourism will gain momentum, he said.
Fourthly, such opportunities will not be equally offered for all the parties involved. Thailand and China, for instance, would enjoy more gains as compared to Laos, where impacts on the environmental, social and cultural fronts will also have to be faced, he added.
Thai traders with business partners in the northern or eastern parts of China, however, say the new highway will not give them any logistic advantage.
Samruay Chaiputhi, who has been importing agricultural chemical products from China for the past 20 years, said he would continue to ship the goods from Shanghai to Bangkok Port. "Transporting these chemicals by land is impractical as it involves many customs checks and procedures," he said. "Damage may occur if the products are loaded and unloaded several times along the way."
In his opinion, the new highway will mainly promote trade, investment and tourism between the southern Chinese provinces of Yunnan and Sichuan and other countries in the region.
All GMS countries should harmonise their customs procedures and settle the issue of revenue sharing from the fees collected for the use of the new highway and bridges spanning the Mekong River, he added.
New look for Laos
Rubber plantations have mushroomed across the land-locked country in recent years to meet China's growing demand for rubber, mainly driven by its booming automobile industry. Before that, China had been involved in mining, hydropower and other resource-related projects to propel its industrialisation.
So far, major Thai investments in Laos have been in contract farming, international logistics, garment manufacturing and hydropower generation, according to Prof Sompop. In China, Thai firms have invested in hotels, agriculture-related businesses and international trade.
In fact, the value of Thai-Lao trade has been on the rise for the past three years - from about 40 billion baht in 2005 to 61.5 billion baht in 2007.
However, since the exports from Thailand exceed the imports from Laos, the trade surplus is enjoyed by Thailand. For example, in 2007, imports from Laos were over 16 billion baht and exports from Thailand were over 45 billion baht, which makes the trade surplus for Thailand nearly 29 billion baht. (See chart)
Main items exported from Thailand to Laos include refined fuels, iron and steel and their products, motor cars and accessories, machinery, woven fabrics, chemical products, plastic products, beauty products and beverages. Main items imported from Laos into Thailand are metal ores and scraps, fuels, wood, vegetables, coal, fruits, stranded wires and cables and machinery.
Dr Sompop said Thailand and Laos should develop a cooperation programme that would permit workers from Laos to work in Thailand with more ease, and at the same time, permit Thai workers to take up more opportunities to work in Laos. "This particularly applies to the agricultural sector, since there is a lot of unused land with potential for agricultural development in Laos. This would, in turn, benefit both countries resulting in a win-win situation," he said.
Regionwide, Thailand should be able to benefit from this linkage because at present, it is a centre that provides road links between many old and new member countries of the Association of Southeast Asian Nations (Asean). Many areas in neighbouring Laos, Burma and Cambodia are land-locked, he added.
Cross-border crime
Another matter that will have to be tackled by respective governments is international crime, such as human and drug trafficking which will become easier with this new mode of transportation, Prof Sompop said, adding that it would be helpful to have sub-regional cooperation to ensure a positive outcome of the development while keeping adverse impacts to a minimum.
The establishment of casinos, which already exist at the Chinese-Lao border, would require added efforts in crime suppression. Likewise, extra measures would be needed to check on human and drug trafficking, and to protect forests that might be encroached for agricultural purposes.
In this respect, intra-regional cooperation that gears for sustainable development is crucial. The Thai government itself must have an action plan for managing this new development, said the professor.
And last, but not least, the academic said Thailand must address economic impacts on local sectors as goods and people move freely across borders.
"With an influx of cheap fruits and vegetables from China, small-scale farmers in northern Thailand will be affected. These farmers will, therefore, have to utilise their land more effectively, for example, by planting more short-lived crops," he said.
Several academics have already voiced concern over the impact of the China-Thailand free trade deal on agricultural produce, which took effect in October 2003.
For example, data from the International Trade Study Centre of the University of Thai Chamber of Commerce (ITSC-UCC) shows that Thailand exported 7,031.97 million baht worth of vegetables to China while it imported 1,203.4 million baht worth from China during the first six months of 2006.
Despite the trade surplus, many Thai vegetable farmers suffered because more than 99 percent of the total value of exports was cassava and its products. China imports Thai cassava to produce alternative fuel, animal feed and other products.
"If we consider other vegetables, we are losing," said ITSC-UCC director Aat Pisanwanich. "For example in 2005, we exported only 13 million baht worth of fresh vegetables and imported about 77 million baht. We exported dried vegetables (excluding dried longan) worth 600,000 baht while importing about 600 million baht."
Hardest hit are northern Thai garlic farmers who have suffered greatly from the flood of cheap garlic from China during the past four years. A study released in March by researchers from Kasetsart University in Bangkok shows that a large number of garlic farmers in northern Thailand have quit because they could not compete with cheaper garlic from China.
Dr Decharat Sukkamnerd, head of the research team, called for a review of the China-Thailand free trade agreement to evaluate the impact on Thai farmers. Future agreements, he added, must be studied more thoroughly.
Cultural aspects
According to Mr Suraphan Boonyamanop, the Thai consul-general in Kunming, the new highway will contribute to stronger Thai-Chinese friendship and cooperation.
While many experts have looked at new trade and investment opportunities, Mr Suraphan said both countries should also strive for greater cooperation in the fields of education, research and development, and cultural exchange.
In education, an increasing number of Chinese students are attending colleges and universities in Thailand, and vice versa. Nine universities in Kunming already have a four-year Bachelors degree programme on the Thai language. Other courses conducted in Thai involve tourism, hospitality and business administration.
Several Thai and Chinese universities already have exchange programmes for both students and teachers. Students who undertake these programmes will study in China or Thailand after completing the first two years in their respective countries.
China has also sought cooperation with Thailand to develop its rice and rubber cultivation. Yunnan is also interested in planting mango, jackfruit and longan, which are popular among Chinese consumers, he added.
Mr Suraphan noted that China has already enhanced its image and presence in Thailand through the promotion of Chinese language study in Thai schools and universities. "Confucius institutes have been set up in various Thai schools, where Chinese language courses are offered to Thai students with free textbooks."
In addition to trade and investment, China will also gain new strategic footholds via access to the Andaman Sea, the Gulf of Thailand, and various ports in Cambodia. "For Thailand, what this brings will really depend on how we can tap into new opportunities," said the consul-general.
"Our relations with China are good in all aspects," he added. "Look at Chinese tourists and you see how happy they are in Thailand."
If a new bridge linking Chiang Khong with Houei Xai is constructed, more tourists can travel by land from Yunnan to northern Thailand via Route 3. Just an 8-10 hours drive from Yunnan, they will be in Chiang Rai by early afternoon, and have dinner in Bangkok. This scenario is already happening between Vietnam and Laos, thanks to the opening two years ago of the Hai Van Tunnel on Vietnam's national Highway 1 linking the East-West corridor with the central seaport of Danang.
Until the Chiang Khong-Houei Xai bridge is built, Chinese tourists and goods destined for Thailand through Laos must be ferried across the Mekong River. Northern Thailand's trade with Yunnan will continue to rely largely on shipping up and down the Mekong, with goods taking anywhere from 10 to 15 days to travel.
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...perhaps a change in direction, but must be tied up with the new Casino being built at Ton Pheung but still interesting to see something small scale being touted.