The sleeping Laos is now awakening

The sleeping Laos is now awakening

By Philippe Agret

VIENTIANE, Laos (AFP): Laos, asleep for most of the decade, is slowly awakening to embrace a market economy while wary of developing a multiparty political system.

"Our goal is to become completely self-sufficient while welcoming foreign enterprises," Vice Prime Minister Khampoui Keobualapha, president of the Committee for Planning and Cooperation, said. Khampoui is in charge of economic reform.

The Laotian regime declared "an open-door policy" at the end of the 1980s, on the initiative of former president Kaysone Phomvihan, during the Soviet Union's implosion and Vietnam's change in economic policy.

The authorities recently abolished passes for natives and foreigners traveling in the country's interior. Laotians abroad, who had fled the revolution in 1975, are discreetly returning and beginning to recover assets and homes.

"We want to strengthen the national economy, which will allow the population to produce more, especially in the rural areas," Khampoui, politburo member and rising star in the government, told foreign journalists Wednesday.

Since 1989, inflation has fallen from 85 percent to seven percent. The growth rate of the gross domestic product exceeds six percent per year.

Laos has adopted a particularly liberal foreign investment code, and has reformed its tax system and public finances.

At the top of the government's priorities for 2000: agriculture, forestry, mining, communications, and especially hydroelectricity: Laos's "white gold." The production goal for hydroelectricity is 1,500 megawatts, thanks to the construction of the Nam Theun II dam.

The three pillars of the future, Kamphoui said, are "political security, public order and economic stability."

The regime, fearful of what happened in the former Soviet Union, has no intention of moving toward a multiparty system or democracy, according to diplomatic circles in Vientiane.

The government also recognizes -- and fears -- the negatives of converting to a market economy.

"The standard of living has improved in the plains, but conditions remain difficult in the mountainous areas," Kamphoui said. These regions are populated by ethnic minorities who often rebel against the central government.

Some leaders are worried about the danger of Thai tutelage. Laos's Thai cousins share the same language and religion and are the first to profit from the Laotian shift to a more open economy.

Thailand invested US$ 61.15 million in Laos in 1993, far ahead of China and Australia, and represents more than 50 percent of the capital injected into Laos since 1988. Thailand is Laos's primary trading partner and imports 70 percent of Laotian hydroelectricity.

Symbolically, King Bhumibol of Thailand yesterday opened the first land link between the two countries: a bridge spanning the Mekong River near Vientiane. It was the king's first trip outside Thailand in 30 years.