Seeing that I am visiting Vientiane soon, I should probably brush up on the often overlooked Southeast Asian country of Laos. (Officially referred to as “Lao PDR,” I found.) I know Laos is “communist.” But that is sort of where my knowledge (embarrassingly) ends.

Where do I begin? Like any normal person, I take a look at their HDI index.


Their HDI level is lower than I imagined it to be. But then again, seeing how little I know about Laos–it is not surprising. I tried to find one specific indicator where they were excelling, or at least meeting the average in the East Asia and Pacific region, but could not. Laos’ population is extremely small at only 6.5 million. Around 65% of the population is Buddhist. (For comparison, neighboring Thailand is 95% Buddhist while Cambodia is 96%.)

Very importantly, however, is the fact that Laos is landlocked. Compared to nations by the coast, landlocked countries have a major disadvantage economically. They must rely upon neighbors for fair, transparent trade practices. It has also been proven that Landlocked Developing Countries (LLDCs) receive far less foreign direct investment compared to coastal counterparts. Moreover, LLDCs generally have limited diversification both of product base and export markets.

So how do these geographically disadvantaged people of Laos make a living? For starters the economy runs mainly on agriculture, employing 75% of population. Economic growth has reduced official poverty rates from 46% in 1992 to 26% in 2010. In neighboring Viet Nam, the poverty rate hovers around 20%. While figures for Cambodia are not so recent, in 2007 it was reported that the population below the poverty line was around 30%. It should be mentioned though that in 2011 the poverty rate in the US was at 15%. Nonetheless, I wonder what the defining factors of “poverty” are on a country to country basis, because I do not believe “poverty” in the US is like “poverty” in a SE Asian country.

It also important to note that tourism is becoming a much more significant industry to Laos. In 2012, visitors reached 3.1 million– up 14% compared to the year before. A boost in tourism means a corresponding increase in investment towards hospitality infrastructure.

However absolutely vital to Laos is the Mekong River. The Mekong is the largest, basically untouched rivers in the world where freshwater fishing thrives. It is the country’s lifeblood; and it is more than just a river. Many Laotians have constructed their lives around the Mekong: fishing, agriculture, transit and so on. But now it has been realized that the pristine Mekong River may be the answer to pull the nation out of such bleak economic conditions. The solution: hydro-power.

Laos essentially lacks in natural resources–aside from the Mekong. While the Mekong starts in China, touches Myanmar, runs through the entirety of Laos, followed by Cambodia, and ends in the Southern tip of Vietnam– its route primarily travels through Laos. And, at last, the Laotian government is looking to utilize this natural resource.

In fact, they have already have started constructing dams. While smaller-scale dams already exists, the 3.5 billion dollar Xayaburi mega dam is expected to be completed in 2019. And, as an effect, displacing residents living in these areas.

Beyond dislocating people, further damming to the Mekong will be detrimental to the ecosystem. Wildlife, especially fish that many eat, will diminish. Obviously many environmentalists have a bone to pick. Yes, there will be huge changes in the biodiversity of the river. And yes, there may be some negative consequences on food security. And very sadly the adorable and highly rare fresh water dolphins that occupy a small part of the river may go extinct. But at the end of the day, what is more important—the animals and ecosystem or the well-being of the Laos economy and populace? These dam initiatives have the capability to pump tons of money into the country.

Of course, the government in Laos does not want to cause environmental harm. They simply want to bring the country out of the World Bank’s “lower middle income” status. Is that too much to ask? The hydro-energy potential in Laos had been referred to as a hydro “battery” for all SE Asia; it will not only be provided for Laos, but also for their neighbors. The dam mentioned above, Xayaburi, is being built by a Thai company with Thai funding. And almost all of the electricity has been pre-sold to Thailand. However, other neighbors Cambodia and Vietnam are not as supportive– fearing the effects on their populations who rely on the river.

Looking into the future, Laos plans on constructing even more dams. Apparently, though, after more research has been conducted to further measure the implications. Just recently, the World Bank resumed support for damming in poverty-stricken countries like Laos. Especially in the 1990s, the World Bank viewed such projects as too costly to the surrounding environment. But nowadays, realizing one of the major barriers to development in such countries was access to energy, hydro-power is seen as a viable solution.

Looking at access to energy, Laos has made tremendous strides, primarily thanks to a World Bank Electrification initiative. In 1995, only 15% of households in Laos had access to electricity. By November 2010 the figure had increased almost five-fold to 71% of the population. There is still work to be done, nonetheless.

At the end of the day, I think it is only fair to allow Laos to utilize the Mekong River. I understand the arguments against damming, but let it be known that many of these environmentalists come from outside Laos borders. Like International Rivers, who are “based out of 5 continents” but still hold a headquarter address in Berkeley, California.

I believe that ensuring a better quality of life for the people of Laos is more important than preserving the biodiversity. And I think building a hydro-energy sector will help the economy as a whole. And very importantly, provide more electricity to the region!


Image 1- Mekong River picture Doron (Own work) via Wikimedia Commons

Graph 1 – Human Development Index via UN Human Development Reports