Tumultuous Times in Laos

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As a landlocked country in Southeast Asia occupying the northwest portion of the Indochinese peninsula, Laos shares borders with China, Vietnam, Cambodia, Thailand, and Burma and is home to approximately 6.3 million people. Laos is a mountainous country in the north, while thick forests cover the eastern areas and the mighty Mekong River flows through the country for over a third of its course, serving as the rice bowl for most of its inhabitants. Despite these natural resources, Laos is one of Asia’s poorest countries.

It is also one of the world’s few remaining communist states; however, since the collapse of the Soviet Union in 1991, it has struggled to find its position within a shifting political and economic setting. Communist forces overthrew the monarchy in 1975, followed by years of isolation from the international community. Laos began opening up to the world in the 1990s but, despite tentative developments, it remains poor and reliant on international donations.

Pre-historic Roots

The human history of Laos stretches back more than 10,000 years in the Huaphan and Luang Prabang provinces that surround the Mekong River. Laos’ first inhabitants were immigrants from southern China who came in the 8th century, and by the 14th century the first Laotian state was founded. In 1713, this state split into three separate kingdoms that came under Thai, then French rule.

A strong nationalist movement developed during World War II, but France reestablished control in 1946 and made the king of Luang Prabang the constitutional monarch. France granted semi-autonomy in 1949 and then, spurred by the Viet Minh rebellion in Vietnam, full independence within the French Union in 1950. Despite this, civil war ensued soon after, and while there were moments of peace in the following years, armed conflict began anew in 1959. The struggle continued until 1961, when a ceasefire was arranged and a coalition government, headed by Prince Souvanna Phouma, was formed.

Sadly, the solidarity of Laos was not to last. North Vietnam, the US (in the form of the CIA), and China remained active in Laos, with North Vietnam using a supply line running down the mountain valleys of eastern Laos into Cambodia and South Vietnam, particularly after the American incursion into Cambodia in 1970 stopped supplies via the seaports.

An agreement was reached in 1973 that revived the coalition government and saw the communist party seizing complete power in 1975. The monarchy was abolished soon after when the king abdicated from his throne, paving the way for a fully communist way of life.

Vientiane was the capital of earlier Lao kingdoms, although it was destroyed by the Siamese early in the nineteenth century. Vientiane was subsequently reestablished by the French as the capital in 1893 when Laos became part of French Indochina. A royal capital existed in Luang Prabang until the fall of the monarchy in 1975.

Finding A Place In The World

During the 1990s, the country began making more diplomatic propositions towards its neighbours. In 1991, the country adopted a new constitution that dropped all references to socialism but retained the one-party state. In addition to implementing market-oriented policies, it also passed laws governing property, inheritance, and contracts. These moves paid off and, in 1995, the US announced the lifting of its ban on aid to Laos.

Laos’ move towards a market economy, and a general relaxation of restrictions, as well as the emergence of a fledgling tourism industry won much support. In a landmark event, Laos joined hands with its regional neighbours and became a member of ASEAN in July 1997.


In the Feb 2002 parliamentary elections, 165 out of 166 candidates were members of the governing Lao People’s Revolutionary Party. In 2006, Choummaly Sayasone became party secretary-general and president of Laos, while the former First Deputy Prime Minister Bouasone Bouphavanh became prime minister, preceded by Thongsing Thammavong.

Laos Today

The government has implemented gradual economic and business reforms since 2005 to somewhat liberalise its domestic markets. In 2011 it opened a stock market in Vientiane as part of a tentative move towards capitalism. Laos also belongs to a number of international organisations, including the United Nations, ASEAN Regional Forum, International Monetary Fund, and the World Bank. Most recently, Laos became a member of the World Trade Organisation.

Economic growth since the 1990s has reduced poverty levels to some degree, but Laos still relies heavily on foreign aid and investment. By most international estimates, Laos is one of the 10 poorest countries in the world, perhaps due to the fact that the subsistence farmers who make up more than 80% of the population have been plagued with bad agricultural conditions, floods, and drought since 1993.

The Asian currency crisis of 1997 caused the national currency, the kip, to lose more than nine-tenths of its value against the US dollar. Outside the capital, many people live without electricity or access to basic facilities.

Lao is the official language, although other local languages include Khmu, Hmong, Vietnamese, and over 100 more dialects. Major foreign languages used throughout the nation are French – the colonial language – and English.

Ethnically Divided

The ethnic Lao in Laos account for 50-60% of the population and live mainly in the lowlands. According to an official classification from 1995, the country contained forty-three ethnic groups, mostly residing in the countryside and mountains. The cities contain significant ethnic Chinese and Vietnamese populations. Other important groups include the Khmou (11%), the Hmong (8%), and more than 100 smaller ethnic groups that total about 20% of the population and comprise the so-called highland or mountain tribes. Ethnic Vietnamese also make up 2%.

The ethnic minority hill tribes can be divided into three categories – the Lao Lum (lowland, Lao), Lao Theung (midland Lao), and Lao Soung (highland Lao). Laos’ attempts at the resettlement of minorities for political control, ecological preservation of forests, and delivery of social services have been poorly executed and have caused resentment amongst the general population. In the south, this has led to the breakup of matrilineal longhouses as groups are moved into standard housing. In the north, Hmong groups have resisted these attempts at control, sometimes violently. In its early years the communist government highlighted its alleged respect for minority cultures, but today there is a greater emphasis on Lao culture.

Despite years of war and isolation, Laos remains one of Southeast Asia’s most pristine environments, home to a variety of rich cultures, simple village life and a relaxed, laid-back population.




Size: 236,800 km2 (World rank: 84th)
Population: 6,500,000 (2012 est.)
Capital city: Vientiane
Largest city: Vientiane
Government: Marxist-Leninist single-party state
Official language: Lao
GDP PPP*: $3,004
HDI**: 0.543, medium (World rank: 138th)
Currency: Lao kip (1MYR = 2,570LAK)

*GDP per capita, purchasing power parity, international dollars
**Human Development Index, a comparative measure of life expectancy, literacy, education, standards of living, and quality of life for 187 countries worldwide. (For comparison, Malaysia’s HDI is 0.769, high, and is ranked 64th.)

Notable facts:

Bordered primarily by Thailand on one side and Vietnam on the other, Laos is the only landlocked country in ASEAN, and is divided into 16 administrative provinces and one prefecture which includes the capital city of Vientiane.

Tourism is soaring in Laos: in the last 20 years, the number of international visitors annually has gone from just 80,000 to some 1.9 million. This is helping to drive the economy of Laos, which is accelerating rapidly with tourism, energy, and metals/mining all contributing.

Curiously, the class divisions of the Lao people correlates strongly to their distribution in the various altitudes of the country: lowland people (about 60%), midland people (30%), and highland people (10%).

Though Lao is the official language of the nation, only about half the population are actually able to speak it. Most speak either French or local rural dialects, with English increasingly being used in education.


Source: The Expat May 2013
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