On the Right Track?: The Lao People's Democratic Republic in 2017

The year 2017 was an important one to assess the performance of the new government of Laos. Prime Minister Thongloun Sisoulith tackled key problems of Lao governance and economy — most notably corruption and illegal logging — earning him both domestic and international approval. However, Laos is still facing numerous socio-economic challenges such as weak legal institutions, poverty, environmental degradation, and a civil society subdued.

According to the 8th Five-Year National Socio-Economic Development Plan (2016–20), Lao economic politics is focused on graduating from the status of being a least developed country (LDC), not least through mega projects like hydropower dams, mines and large-scale infrastructure projects — negative social and ecological side effects notwithstanding. China and many ASEAN countries compete in large-scale investment in these fields. The Lao–Chinese railway linking Kunming with Vientiane is a case in point.

This chapter gives an overview of political and economic tendencies in the Lao PDR at the beginning of the new five-year cycle.

The Tenth Party Congress and its Aftermath

The year 2017 saw widely noticed political decisions of the new Government of Laos. The government addressed key challenges mentioned in the 8th Five-Year National Socio-Economic Development Plan (2016–20), such as the fight against corruption, illegal logging, and uncontrolled investment. This raised cautious hopes for more efficient and transparent governance. Prime Minister Thongloun Sisoulith gained a public image of a pragmatic and responsible politician. However, Laos still faces many problems: poverty and low education, environmental degradation, pressure on civil society, and the negative ecological and social impacts of hydropower dams and mining projects.

Meanwhile, the dynamic economic sector — with a growth of slightly below seven per cent in 2017 — dominated the Lao news and the political agenda. Large-scale investment projects such as hydropower dams, coal plants and, not least, the huge Lao–Chinese railway project indicate Laos' ongoing reliance on natural resources and increasing regional connectivity. The high social and environmental costs of the government's obsession with such mega projects became evident in 2017 as well. This chapter gives an overview of political and economic tendencies — and their social implications — in the Lao PDR.

In last year's country overview on Laos, Soulatha Sayalath and Simon Creak provided an insightful analysis of the Lao People's Revolutionary Party's "regeneration". This process, culminating in the reshuffle of the leadership at the Tenth Party Congress, demonstrated "not only the degree to which the party's structures and processes have been designed to maintain party power and stability, but also to ensure elite prerogatives are not unduly challenged".¹ Indeed, 2017 demonstrated the stability of the Lao party-state (phak lat) and the government's will to maintain control and order.

The replacement of retired president and secretary general Choummaly Sayasone (then 78 years old) with party-state veteran Bounnyang Vorachit (77; number one in the Politburo), and former prime minister Thongsing Thammavong (73) with Thongloun Sisoulith (72; number two in the Politburo), was certainly not a generation change. Yet, the rise of sons and daughters, nieces and nephews of the old "30-year-struggle" guard, as well as a new generation of well-educated technocrats within the ranks of the Central Committee, hint at a rejuvenation with simultaneous continuity within the party-state. Old family relations and patronage networks ensure the reproduction of the Lao political elite.

Continuity is probably best represented by the Politburo members Xaysomphone Phomvihane and Sonxay Siphandone, sons of the revolutionary heroes and party founding fathers Kaysone Phomvihane and Kamtay Siphandone. They also represent the powerful southern families (including the Sayasons and Vorachits) that for decades have paired political with economic power. Thongloun Sisoulith (his father-in-law was Phoumi Vongvichit, another LPRP founding father) and his confidants, including rising stars like Vice President Phankham Viphavanh and Foreign Minister Saleumxay Kommasith, hail from the revolutionary heartland in Northeastern Laos. Finally, Pany Yathotou, president of the National Assembly and number three in the Politburo, is the daughter of the Hmong military leader Thao Touya.

Gradually, the post-1975 generation is taking...