Vientiane: The Chinatown affair

At the French Bakery and Pastry Shop in Vientiane, Laos, a consultant from New Zealand and an Indian aid worker on a visit from Kyrgyzstan discuss “governance,” “gender,” “monitoring,” “baseline surveys”, exchange office gossip and compare shopping at different airports. At another cafe, an American capacity builder tells a Dutch microfinancier about his disappointment after spending 18 million dollars in Laos, only to see it syphoned off by corruption.

The Chinese investors in the city have very different problems. For many years, Western aid had been just about the only source of foreign capital in Laos, but in recent years, the influx of money from China — largely a combination of commercial and concessional loans by China’s policy banks to Chinese state-owned companies — has transformed Vientiane. The National Palace of Culture was built with a Chinese grant in 2004, as was  the Central Park. The Kunming Enterprise Development Company’s Lao-Chinese Friendship Market (owned by a state enterprise from Yunnan Province) and the new Sanjiang Clothing and Small Goods Market (owned by an investor from Zhejiang) have attracted thousands of small traders from Zhejiang, Hunan, and Sichuan, and their neighbourhoods have a loud, vibrant, never-sleeps atmosphere that is quite different from the rest of the city.

Chinese investment and aid became the subject of public controversy this year, when the Lao government granted a Chinese company a 99-year concession for a piece of land known as the That Luang marshes, in exchange for a concessional loan to construct a stadium that will be used in next year’s ASEAN games. (The arrangement is that the loan will be repaid by the company that holds the concession.) Numerous English-language articles asserted that the land will be used to develop a “Chinatown” where 300 thousand migrants from China will be housed. While there seems to be little animosity toward the Chinese presence in general, this news generated unease among the Lao middle class: as my Lao-Chinese landlady told me, they are afraid that “the Chinese will take over because they work very hard and the Lao don’t like to work.” The controversy apparently triggered a split in the government (with one faction supporting the project and another opposing) and, according to the secretary-general of the Chinese Association in Vientiane, became sufficiently uncomfortable for the Chinese government that construction has been suspended not only on this project, but also on dams, which are a favourite target for Western development NGOs’ criticism, and the China-Thailand railway. Only the stadium is going ahead full speed.

I found the reports on plans to resettle 300 thousand Chinese hard to believe. Similar stories have accompanied the expansion of Chinese migration to new places since the early 1990s, when there was a similar canard about an island in the Danube being sold to create a Chinese settlement. The assumption behind this seems to be that the Chinese government is actively organising emigration as a strategic tool for its presumably sinister goals. This is not so; the elites of the state-owned enterprises in China are squeamish to keep a distance from the ordinary migrants, whom they refer to as “peasants.” They are, for example, not allowed to join the Chinese Chamber of Commerce, which connects with the embassy to the large companies. These small migrants want to make, and save, as much money as they can and go back to China; they will not purchase flats in an upcale condo. The target market for such a development will include some Chinese already here, but mostly it will consist of the Lao elite and expats who want to live in the type of housing they have seen in Singapore, Bangkok, or Shanghai. According to the secretary of the Chinese Association, this is precisely the idea: the investors have identified the last virgin real-estate market in a Southeast Asian capital. (Phnom Penh is currently awash with similar projects.)

“It’s weird,” the secretary says, “when other countries do projects like this people don’t care.” A Korean company apparently obtained a 99-year concession for a golf course in the World Heritage town of Luang Prabang. The mayor of Moscow, Yuri Luzhkov, no less an autocrat than any Chinese leader, was in Vientiane a few days ago and said he would like to see a Moscow Street built.

Sure, a lot of the fear of “Chinese-style development” is of a specifically yellow-peril kind: it’s big, Communist, and “racially/culturally alien.”  And of course a lot of the specific criticism — about corruption, environmental damage, and so on — may be justified (though it also has a lot to do with the Western development industry’s current prioritizing on the poorest rural populations as against the just moderately poor urban dwellers, who are likely to benefit from Chinese jobs.) But at some level, fears of Chinese “expansion” is very similar to fears of globalisation, which paradoxically continues to be thought of as a Western thing. European anti-globalists have for years been blaming the greed and callousness of America and the global capitalism they associate with it for the loss of local, authentic cultures and ways of life to a superficial, commodified, homogeneous McWorld. But just as these fears have proven largely misguided (although they continue to be popular on the Western left), so will likely the fears of the new, powerful flow of globalisation from China likely. There are of course significant differences,as Chinese globalization is more of a political, state-controlled (though not exactly state-directed) project than America’s ever was. But the more diverse the flows of China’s globalization become, the less controlled they will be.

2 Responses to Vientiane: The Chinatown affair

  1. mqvu says:

    Some recent, mostly negative, English-language articles on Chinese investment in Laos are:

    “China farms the world to feed a ravenous economy,” International Herald Tribune, 4 May 2008

    Brian McCartan, “China rubber demand stretches Laos,” Asia Times, 19 December 2007

    Brian McCartan, “China and Vietnam square off in Laos,” Asia Times, Aug 30, 2008

    BBC World, “China Moves into Laid-Back Laos,” 8 April 2008

  2. concerned says:

    Chinese factories are polluting the Lao countryside, BIG TIME!
    What can be done about this?

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