The Western aid sector in Laos – days numbered?

Last month I wrote a short post on the announcement that China will fund a railway in Laos. Drawing a parallel with French colonialism, which gave birth to the modern idea of Laos, and the recent SEA Games in Vientiane, my point  was that Chinese investment might strengthen the Lao Party-State rather than threaten it, as long as it can present itself as conductor of these forces.

One respondent strongly criticised the SEA Games deal which saw China build the main stadium in return for a concession to develop a ‘Chinatown’ in the That Luang marsh, a culturally and environmentally sensitive area near That Luang stupa in Vientiane. This was ‘a political decision which bypassed many impacted government organizations and existing Lao regulations’. Further, ‘Danida and JICA [the Danish and Japanese development agencies] had spent considerable sums to manage the wetlands for their ecological services as well as flood control and wastewater management purposes’. The railway development project, the respondent hoped, would pay greater heed to social, cultural and environmental issues.

These are important concerns. Stepping back, however, what do they say about the role of the Western aid sector in Laos as the Lao People’s Revolutionary Party pursues a development strategy based on regional cooperation financed by the China and Vietnam (which, in 2009, remained the biggest investor in Laos)?

Clearly, the Chinese and Vietnamese governments and investors have fewer concerns for Western paradigms of participatory or sustainable development, and are less encumbered by legal processes and institutions. In Laos, meanwhile, our respondent highlighted the fact that government leaders will act unilaterally, outside of its own checks and balances when it deems this politically or economically necessary. Obviously, this doesn’t bode well for the railway and other major projects.

Since Laos opened up in the late 1980s, it has readily embraced assistance offered by the Western aid sector. But in this radically different development environment, it seems likely this sector’s role is going to be increasingly limited. At the SEA Games, it most striking that, while ASEAN countries, Japan, Korea and, of course China, underwrote the event and, in this sense shared in the unprecedented national success they represented, the West was conspicuous in its absence. No doubt there were principles involved, but for how long will these principles remain relevant?

About Simon Creak