Vientiane Burlesque

President General Khamtay Siphandone on February 24, 1998. (Photo: AFP/Getty Images)

Laos is a secretive hermit-state. It’s difficult to determine what is really going on, but the available evidence suggests that disenchantment with the regime is growing.

The economy is in shambles and poverty is widespread. Its human rights record remains poor. Bomb attacks and assaults on motorists that once occurred sporadically across the country have escalated and with increasing frequency in the capital, Vientiane. The government is quick to blame “bandits” or perhaps Hmong insurgents. Exiled opposition groups claim responsibility and say the revolution is on. Local and Western residents in the capital say the public is too poor, cowed or indifferent to raise a stir, adding that Laos has never had a homegrown opposition movement. An inside source believes the incidents could be the tip of the iceberg.

So what’s going on in Laos?

At the top, very little. President General Khamtay Siphandone, the 80-year-old chairman of the communist Lao People’s Democratic Party—the country’s only legal party—is old school. In 1946 he joined the Lao Issara, or Free Laos Movement, that fought to liberate the country from French rule, and stayed with the Pathet Lao faction that broke away three years later.

As part of the “inner circle” of cabinet ministers that made all major decisions in the Vietnam-backed government of Kaysone Phomvihane, who headed the party when it took over in 1975 until his death in 1992, Khamtay is seen as little more than a clone of his predecessor.

His top adviser, 90-year-old General Nouhak Phoumsavan, was also part of that inner circle and served as deputy prime minister under the iconic Kaysone. Prime Minister Bounnang Vorachit is a civilian but was handpicked by Khamtay for the largely ceremonial post.

With the first generation of communist leaders still in office any power-shifts could be some years away. “There won’t be any change in Laos until all these guys die off,” says a storeowner in Vientiane.

But Laos’s deepening economic crisis has moved some to try and hasten the pace.

The purchasing power and private savings of many Laotians were wiped out by triple-digit inflation in the two years following the 1997 economic collapse. The local currency, the kip, dropped from 1,080 against the greenback that year to over 10,000 today. Tax collection is weak and social services barely exist. Government workers, soldiers included, customarily wait months to receive salaries.

The administration hopes continued strong growth in Thailand and Vietnam—its two largest trading partners—will help reverse the slide. Its garment-manufacturing sector is looking to gain from normalized trade relations with the U.S. and increased orders from the EU, which accounts for 85% of Lao textile exports.

But nearly 80% of the government’s capital expenditure comes from foreign aid, mostly from Japan, Sweden, Australia and Germany. Donors have begun tying aid to political and economic reforms, but more than 80 international aid organizations operate in Laos—and their cash, says a Western diplomat in the capital, is bankrolling the communist regime.

Most aid money is earmarked for infrastructure projects like roads and dams but much of it goes astray. Journalists, Lao dissidents, and longtime expatriate residents regularly chide foreign aid workers and jokingly refer to them as “experts” who are “preying on Laos.”

The reverse could also be said. A Western consultant in Vientiane says that while the presence of foreign NGOs (local NGOs are illegal) has helped raise awareness of social and economic issues in Laos, government officials tend to evaluate development projects only by what individual perks they will reap. “They need money for a Land Cruiser, a house and income to send kids overseas to study,” the consultant says.

It is such greed in the face of grinding poverty that is fueling the attacks around the country, which, though small-scale and inflicting minimal casualties in recent years, have occurred with marked regularity over the past four months.

The choice of targets indicates a calculated effort to go after the regime: outside Patouxay monument in February during a meeting of regional tourism ministers; two days later, a dud was recovered outside the Vietnamese embassy; in May, a time-bomb exploded prematurely outside the Lao Women’s Union, killing the perpetrator; a few days later a bomb reportedly detonated at the foot of the Friendship Bridge linking Laos to Thailand, during the tenth anniversary celebration of its opening. (The government attributed the blast to a hyped-up firework gone awry.)

Some accuse supporters of the deposed royalist regime. Others say it is the result of business deals turned sour or the high jinks of lone individuals. The government blames “bandits” and only recently acknowledged that the incidents could be the work of ethnic Hmong insurgents, who have waged a low-intensity guerilla war against the Vietnam-backed Pathet Lao government since it claimed victory in 1975.

But there is a pattern and regularity to the incidents that suggests something else is in the works.

In March 2003, a retired general and retired colonel tried to spearhead a movement to instigate peaceful demonstrations across the country and got whacked for their efforts, says an inside source in Laos. Before their car was run off the road, the two were believed to have been part of a nationwide underground opposition movement composed of more than 10,000 ex-military and ex-police officers, though this has not been confirmed independently.

If true, however, their ranks could swell with troops from defiant military units that have defected in the northern provinces of Sam Neua, Luang Prabang and Xiang Khouang, and near the junction of routes 7 and 13, over the past year. A Lao dissident and former government official in exile says that unpaid soldiers are deserting all over the country. A Western consultant in Vientiane reports that deserters have been torching and shooting at the homes of district officers.

Mid-level officers in the provinces are being replaced by younger, better-educated upstarts for similarly low salaries. Pensions are rare, or in some cases consist of a meager timber concession, which they must cut themselves. It is now common for soldiers and government workers in the countryside to raise chickens and vegetables and to borrow money from local lenders at 10 percent interest while they wait to receive their paychecks.

Soldiers may be armed and among the poorest people in Laos, but it is Lao and Hmong groups outside the country that has claimed responsibility for many of the attacks. Few people in Vientiane have warmed to the overseas opposition groups, however, and many observers reject speculation of their involvement.

But in July 2000, elements of the Lao Freedom Fighters attacked a customs and immigration outpost in Champassak—Prime Minister Khamtay’s hometown. Some of the assailants were members of the former Royal Lao military southern command regions.

Last year, the previously unknown Free Democratic People’s Government of Laos sent a fax from neighboring Thailand that took credit for a spate of attacks in Vientiane and Savannaket, in the south. It called for the Vietnamese to be driven out of the country and power returned to the people.

And in mid-April, 30 Hmong insurgents were apprehended by government troops in the northwestern tip of Sayabouri Province. Among those captured were believed to be some Hmong-Americans, who were reportedly killed shortly after their arrest, says the inside source.

A recent visitor to Hmong rebels in Sayabouri says that satellite telephones enable them to communicate regularly with relatives in California, with some issuing military orders from Fresno.

The sad truth, however, is that most Hmong want to abandon their decades-long struggle. The 21 or so Hmong insurgent groups scattered throughout Laos are remnants of Vang Pao’s once 20,000-strong army who were stranded after the communist takeover in 1975. Unable to surrender or flee to Thailand, the few thousand unfortunate soldiers that remain are surrounded by some 6,000 government troops—which have killed 179 Hmong rebels this year, says the visitor. Unless urgent action is taken to rescue them, the Hmong insurgency may be “completely wiped out in a matter of months.”

Most agree that the catalyst for change won’t come from the intermittent highway assaults by the Hmong or from the crude bombings carried out by exile groups. Nor will it come from the work of disaffected ex-government workers and ex-soldiers.

With Khamtay and the army firmly in command, neither will second generation party members and reform-minded government officials be able reverse Laos’s declining fortunes.

The only events that could spur change, says the Lao dissident in exile, are power-shifts in Vietnam, or the deaths of the top tier in Vientiane.
The dissident is hopeful that time will come in the next few years. But a Western diplomat in the capital is less optimistic.
As efforts to integrate the region to promote economic growth gather speed, Laos will likely be swamped by its larger, richer neighbors. Already, aggressive Vietnamese and Chinese timber merchants, as well as Laotian soldiers who sell logs to compensate for not getting paid, are depleting the forest cover.

Revenues generated from timber and planned hydropower projects will likely only sustain the communist regime—as gas does for the junta in Burma and oil for despotic Arab governments.

Plans to dam the Nam Theun River have come against stiff objections over flooding and resettlement issues. But the $1.2 billion scheme would bring the government some $2 billion in its first 25 years of operation, scheduled for 2009.

Speaking of the country’s prospects for the long term, the diplomat offers his assessment: “Laos is toast.”