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The US-Lao relationship: Don’t you forget about me

US President Barack Obama speaking to a crowd of Lao youth in Vientiane. Photo: USAID Flickr page

US President Barack Obama speaking to a crowd of Lao youth in Vientiane. Photo: USAID Flickr page

When considering US foreign policy in Laos, we cannot help but wonder whether President-elect Donald Trump has ever thought about small Southeast Asian country. It would be a mistake for the incoming administration to ignore the significance of the new opportunities for US-Lao engagement that President Obama’s September visit helped to catalyze. While in Laos, Obama acknowledged the US “moral responsibility” to help Laos recover from the ruinous legacies of the war with the US. Recognizing this complicated shared past, the President announced several new initiatives aimed at paving the way for enhanced US engagement with Laos, including a new Comprehensive Partnership between the two countries, increased funding for UXO removal , a new USAID office in Vientiane. His visit also ushered in the opening of new General Electric and Microsoft offices in Vientiane. Sustaining the momentum for positive US engagement in Laos will require continued support for government-led programs, increased private sector engagement, a greater NGO presence, and more people-to-people exchanges.

In the last two decades, Laos has pursued a strategy of attracting foreign investment to boost economic growth and development. Currently, China contributes about 40% of all FDI, making it Laos’s largest investor, followed by Thailand and Vietnam. Most of this investment is in natural resources such as hydropower, agriculture, forestry, and mining. Investment in natural resources extraction and development has come at a high environmental cost. Officials within the Lao government often lack the resources or the political will necessary to determine the full environmental and social impacts of a new development projects before a concession agreement is signed. Many foreign developers in Laos fail to abide by environmental and social safeguards. Plus, a lack of space for civil society to criticize or protest development projects means that potentially destructive projects such as dams, mines, or plantations, often go ahead without proper consideration of the social and environmental costs. All of these factors have contributed to a situation in which critical land and aquatic ecosystems in Laos are degraded at an alarming rate.  Often, the rural citizens who depend on these ecosystems for their livelihoods are left worse off as a result of new development projects. Meanwhile, despite the wealth gained from the development of natural resources, poverty and inequality in Laos remain widespread.

The U.S. currently invests very little in Laos. Between 1989 and 2014, the U.S. accounted for only 1.1% of FDI in Laos, and although the US is the single largest investor in ASEAN as a whole, it is the 14th largest investor in Laos. Historically, doing business in Laos has been quite difficult for foreigners. In 2010, Laos was ranked the 171st out of 183 countries in “ease of doing business” by the World Bank Group. In Transparency International’s Corruption Perception Index the same year, Laos was ranked 154th out of 180 countries.[1] However, the barriers to US trade and investment in Laos have been lowering. In 2013, Laos joined the World Trade Organization, and in February 2016, the U.S. and Laos signed a Trade and Investment Framework Agreement. The Agreement set up a Joint Trade and Investment Committee that meets at least once a year to enable trade and investment between the countries by identifying and addressing barriers.

The U.S. can play a key role in helping Laos to develop the capacity for more sustainable and inclusive economic growth. Rather than competing with China and other regional powers for the rights to develop natural resources in Laos, which the US is not likely to do, the US can invest in developing human resources and improving capacity to better manage and regulate the use of its natural resources. This is the idea behind the Smart Infrastructure for the Mekong program, an inter-agency US government-led program that provides technical assistance to line agencies in Mekong countries to support sustainable infrastructure development.

One promising area for investment in Laos is in renewable energies such as solar and wind. During Obama’s visit, he announced that the U.S. would provide funding for a feasibility study for a 20 MW solar power plant in Laos, which if completed, could power up to 30,000 households. With its significant solar power potential and relative lack of energy production and distribution infrastructure, Laos has the opportunity to leapfrog dirtier energy production technologies, taking advantage of the rapidly dropping prices for renewable technologies.

Another sector with significant potential for growth in Laos is in tourism.  Laos has spectacularly beautiful natural landscapes as well as unique sights that tell the story of a rich and layered history. After opening its borders to international tourists in 1989, inbound tourism has been steadily increasing. However, as Robert Travers argues, tourism infrastructure in Laos is being developed in an uncoordinated fashion, [2] and as a result, Laos has become a short-term stop on the backpacker trail through Southeast Asia. Through a strategic and coordinated approach to tourism development that highlights its unique culture, Laos could attract more long-term visitors and generate considerable revenues from tourism. Just as the US is promoting tourism to Vietnam, it can do the same with Laos.

Effective U.S. engagement in Laos, whether at the government or grassroots level, will only be possible through continued people-to-people relationship building between Americans and Lao people in order to develop mutual understanding and greater trust between the two countries. The US government should continue to pursue a Peace Corps program with Lao PDR and should offer increased funding for educational exchanges for Lao and American students.

Through strategic engagement with Laos, the U.S. can continue to build upon the momentum for improved relations cultivated over the last few years. Now is the time for enhanced US engagement that is guided by a commitment to helping Laos take a more sustainable and equitable approach to development.

Gabriella Neusner is currently an intern at the Stimson Center’s Southeast Asia Program.

[1] US Department of State. (March 2011) “2011 Investment Climate Statement – Laos.” http://www.state.gov/e/eb/rls/othr/ics/2011/157307.htm

[2] Travers, R. (2008). Economic Corridors and Ecotourism: Whiter Tourism in Laos. Asian tourism: Growth and change, 105-116.

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Filed under FEATURES, Foreign policy, Laos, SLIDER, US Rebalance, USA

The 3rd Annual ICIRD Conference, Part II

Previously, I introduced ICIRD 2013, a Bangkok-based conference exploring issues of development, greater economic integration, and the idea of the regional commons. This blog post will delve more deeply into the background of the commons, an alternative way of organizing public goods that circumvents the hungry advance of neoliberal globalization. 

By way of illustrating, one of the most pressing current issues surrounds the Mekong River, the classic example of a regional – and transboundary – commons in Southeast Asia. Crossing six countries, laden with social and historical significance, and layered with overlapping claims and uses, millions depend on its shared resources, while growing hydropower development threatens large-scale devastation and destruction of riparian ecosystems. But forms of the commons can range in scale from municipal parks and shared community fishing sites along river banks, to oceans and digital commons on the far end.

The Commons as Social and Historical

Certainly in the context of greater regional integration augured by the ASEAN Economic Community (AEC), the concept of the commons becomes an increasingly important, if imperiled, way of organizing assets and resources within communities. Introducing the Focus on the Global South Round Table I, Shalmali Guttal offered the following definition of the commons: it is a collection of assets that are actively managed for the good of the collective and should be accessible by everyone. They include not only natural and physical resources, but social, cultural, political (e.g., concepts like justice) and intellectual wealth as well.

But that’s not all that the concept offers: there can be no commons without a certain type of social relations based on sharing. It’s important to remember that the commons are entwined within the history of Southeast Asia, just as its growing commodification is embedded within the larger context of globalization. As Dr. Victor Savage (National University of Singapore) mentioned in an earlier panel, historically the Southeast Asian region has lacked traditional notions of private land ownership. Here, instead, usufruct rights guaranteed the rights of access for communities, and the commons functioned as safety net and social insurance.

But over time, as  Dr. Walden Bello (Member of the Philippines’ House of Representatives) reviewed, the transition to capitalism became inextricable from the plunder of non-Western societies, in a process that continues even now. He argued, for example, that the ADB and World Bank are central in enforcing ideologies of private property and codes to delegitimize communal traditions.

The tension between these divergent worldviews, one based upon the primacy of private property and the other upon the social relations upholding the commons, is ultimately not about choosing between a given set of choices, but rather about entire ideological frameworks brought together in one current, historically-informed confrontation.

Resistance and Alternatives

Pervasive throughout the ICIRD panels was the idea that everywhere the commons are being threatened by a neoliberal logic that seeks its enclosure and commercialization. The growing commodification of nature makes itself readily felt in the rise of issues like land grabbing, water privatization, and rampant hydropower development in the region, all of which were repeatedly raised in the course of the conference.

Neoliberalism, in Dr. Bello’s account, lost much of its legitimacy, due in part to the role of research organizations and scholars who documented its high human costs, as well as the internal crises of neoliberalism, erupting spectacularly in the Asian financial crisis of 1997 and the global crisis in 2008. He argues that while neoliberalism has been largely discredited, the lack of alternative paradigms means that it remains a source of default strategies for technocrats.

It may be partially true that business as usual continues for lack of other competing visions. But power also incentivizes its own perpetuation. And raising alternative possibilities is one way to counter the naturalization and legitimacy of dominant neoliberal globalization as it is taking place.

In seeking alternative forms of state-community relationships, it makes sense to step back from the lens of the nation-state. Yong Ming Li’s presentation (subtitled “Seeing like a chao baan/neak tonle,” in reference to James C. Scott’s seminal tome) offers one such narrative. By shifting down to the scale of the local, social-natural relations take on a new centrality that includes “a multiplicity of grounded perspectives and practices from the chao baan (villagers) of Chiang Khong, Thailand and the neak tonle (villagers living on the Tonle Sap lake)” (from ICIRD paper abstract). These social-natural relationships defy conceptualization based solely on market relations with nature.

The role of the research and academic communities seems clear – to keep giving voice to critical analyses of the changes taking place in the region and what’s at stake. To illustrate, the “Encouraging Green Growth in Thailand” forum was based on the appealing premise that “green economies will lead to higher resource efficiency, and investments in green innovation will benefit green pioneers with new markets, higher productivity, and human capital development” (from panel summary). Yet the forum ended in a robust debate about whether green growth (with its undeniable focus on growth) represents merely another reconfiguration of capitalism being pushed towards a new frontier.

Ultimately, as former Philippines Senator Dr. Orlando S. Mercado (who holds the distinction of being the first permanent representative of the country to ASEAN) told me after the Focus panel:

“We have to struggle to have our voices heard. But we should not only just be making our voices heard. We have to be able to move within the system to affect changes by taking advantage of various crises that erupt. To me, as a scholar interested in disaster mis-management, I feel that the cause of protecting the commons is served very well by making sure that each crisis, each disaster, each calamity, is taken advantage of to show that there must be people championing the cause of those who are adversely affected by its lack of management and the privatization that is ongoing as a consequence of economic development – all on the altar of creating a community that is ‘prosperous’.”


Filed under ASEAN, China, Current Events, Economic development, Environment and sustainability, Governance, Mekong River, Reviews, SLIDER, Thailand, water

The 3rd Annual ICIRD Conference, Part I

With the ASEAN Economic Community set to launch in 2015, it’s not surprising to see a heightened level of uncertainty, concern, and even apprehension about what this enhanced sphere of regional integration will mean for Southeast Asian nations.

Holding this backdrop firmly in mind, the 3rd Annual International Conference on International Relations and Development (ICIRD) recently commenced at Chulalongkorn University in Bangkok, on August 22-23, 2013. This year’s timely theme, “Beyond Borders: Building a Regional Commons in SE Asia,” showcased established voices, civil society organizations, and a new generation of scholars rising to the challenges of this historical moment. Over forty panels traversed diverse but interrelated topics from environmental justice and human rights, to sustainable economic growth.

While few would deny the problems of development in Asia as they have manifested so far (e.g., environmental degradation, growing income disparity, and resettlement), finding a consensus on a way forward proves much more difficult. As Dr. Siriporn Wajjwalku (Assoc. Prof., Thammasat University) noted with some urgency in the opening remarks, “2015 for us in the region is approaching… It’s extremely important for us to think about the commons and go beyond the borders that we are facing now.”

Dialogue and discussion are a good place to start. Thus Dr. Carl Middleton (Lect., Chulalongkorn University), a member of the ICIRD Executive Committee that organized the event, proclaimed the conference “a success in that there was plenty of sharing of knowledge, experience and ideas amongst the participants, and a wide range of examples of the commons and how they support peoples well-being and create public space were discussed.” Continue reading

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Filed under ASEAN, China, Current Events, Economic development, Environment and sustainability, Governance, Mekong River, Thailand, water