There was so much ‘secret’ bombing of Xieng Khouang province in northern Laos that even the pigpens in remote hill-tribe villages are made of American cluster-bomb casings. Villagers bring out American parachutes for marriages and other festivals and unfurl them to make marquees for the guests. I’ve seen sturdy metal bomb casings being used as pillars to support houses and rice granaries, as window-boxes for flowers and vegetables, and as troughs for animal feed. Planted in rows, they become fences. The damage that the bombs inflicted is visible too: in the craters splattered over the Plain of Jars – the ‘jars’ are mysterious stone urns thought to date back more than a thousand years – and in the roadside piles of twisted metal waiting to be sold as scrap.

The bombing is one of Laos’s few claims to fame in modern times. In their vain attempt to defeat Indochinese Communism, the Americans dropped over two million tonnes of bombs on the country – more than the tonnage dropped by all US aircraft during World War Two – and gave Laos the macabre distinction of being per capita the most heavily bombed nation in the history of aerial warfare. Indeed, 25-year-old cluster bombs are still killing and maiming people. Rice farmers hit the bomblets with their ploughs, villagers step on them in the forest, and children blow themselves apart playing with them.

Visitors who travel further up the pot-holed road in what may be Xieng Khouang’s only taxi, an ageing Russian Volga, will have no trouble spotting Laos’s second claim to international renown: opium. At Nong Het, close to the Vietnamese border, a woman is weeding a field of purple and white opium poppies in front of her house. None of the villagers is embarrassed. Opium is just a traditional crop, and not a particularly lucrative one at that. Buyers from China, Vietnam and elsewhere in Laos take it away and refine it into heroin for foreign markets. Few of the Lao people are intravenous drug-users, although villagers say many of their older relatives are opium addicts.

Laos survived the wartime bombing – towns in Xieng Khouang were flattened but many of the inhabitants hid in caves in the hills – and it has survived two decades of Communist rule. It will survive attempts to eradicate the opium trade; with the help of the United Nations and other foreign aid agencies, the inhabitants of Nong Het are already turning to other crops such as corn and apples. But whether this sleepy country and its mix of lowlanders and hill-tribe minorities will emerge unscathed from the changes taking place all around them in South-East Asia is another matter. Lao government officials and French-educated intellectuals are observing with as much alarm as hope the booming economies of neighbouring China, Thailand and Vietnam; they realise that tourism, industry and commerce will change life in Laos as surely as the bombing changed the landscape of the Plain of Jars.

Like their comrades and patrons in Vietnam, Laos’s Communist rulers withstood the American carpet-bombing and won the war. By the Eighties, however, the decline of the Soviet Union and their own inability to match the economic achievements of their capitalist South-East Asian neighbours meant that they were losing the peace. The Pathet Lao (‘Land of the Lao’) Communist movement took power in Vientiane, the capital, in 1975 and abolished the 600-year-old Lao monarchy in the aftermath of the US withdrawal from Indochina and the turmoil of the Lao civil war; the subsequent decade of Communisation and repression was largely hidden from the eyes of the outside world by the Communists’ obsession with secrecy and by foreigners’ lack of interest in a country as insignificant as Laos. Hundreds of thousands of educated Lao – perhaps a tenth of the population – fled the country to settle in the US or France. Many of the Hmong guerrillas who had fought loyally for the Americans ended up over the border in Thailand, from where they were to harass the new regime almost until the present day. Thousands Lao who failed to escape were sent to re-education camps, including the last king, Savang Vatthana, and his wife Queen Khampoui; they perished in a camp in the north, something the Government acknowledged officially only in 1989.

The man who ran the country – with the help of Prince Souphanouvong, the so-called ‘Red Prince’ – was Kaysone Phomvihane, the burly son of a Lao peasant woman and a Vietnamese employed by the French colonial service. Working with Ho Chi Minh, he agitated against the French, and from the Pathet Lao’s cave base in northern Laos, against the US-backed royalists. Kaysone was an old-fashioned Communist. As well as being prime minister, and eventually president in 1991, he headed the Lao People’s Revolutionary Party from 1955 until his death a year ago. After the Communist victory, industries were nationalised, agricultural co-operatives were forced on the peasants and the property of ‘reactionaries’ was confiscated. By the mid-Eighties, it was as obvious to the people of Laos as it was to the Vietnamese and the Russians that Communist economics were a failure. So Laos introduced the ‘New Economic Mechanism’, the Lao codeword for ‘capitalism’; it is the Lao equivalent of perestroika in the Soviet Union and doi moi in Vietnam.

As in Vietnam and China, the regime has eschewed fundamental political change, arguing – with support from authoritarian Asian capitalists – that economic reform should take root before multi-party democracy is introduced with all its instability. There has been some loosening of the Party’s grip, however. Most political prisoners have been freed, Laos has dropped the hammer and sickle from its flag, and in elections last year non-Party members were allowed to stand as candidates (although they were vetted by the Party first). But such social and political liberalisation as has occurred can be attributed as much to outside forces (the international decline of Communism and the influence of karaoke and foreign investment) as to any change of heart in the upper ranks of the LPRP. The old guard, albeit floundering in the ideological vacuum that afflicts all Communists when they abandon the economic basis of their beliefs, is still in charge. Kaysone was replaced as president by the 79-year-old Nouhak Phoumsavan, one of his close colleagues. State radio still trumpets old-fashioned propaganda from the street corners of Lao towns, and Phoumi Vongvichit, another ageing Communist leader, said recently: ‘The one-party system will be in Laos for ever.’

Even today, after several years of economic reform, Laos’s 4.4 million people are among the poorest in the world, with an annual per capita income of about $230 and a standard of living similar to that of many Africans. They depend heavily on foreign aid. There, however, the similarity with Africa ends. Laos’s location in the midst of one of the fastest-growing regions in the world will make it hard for the country to miss the benefits of increased trade and investment – or to avoid the disadvantages of a new wave of foreign influence. While trying to reduce its dependence on Vietnam, Laos finds itself in danger of being overwhelmed by the economic might of Thailand; hence the Government’s policy of reaching out further afield for friends in Canberra or Tokyo. Laos is often described as a ‘tiny, landlocked country’, but ‘tiny’ is more a reflection of Laos’s influence than anything else.

Vientiane, the capital, dozes on the northern bank of the Mekong River opposite the Thai town of Nong Khai. Buffalo graze on the river bank next to Buddhist temples, outdoor cafés and small fields of vegetables. The socialism of the ruling Lao People’s Revolutionary Party is retreating before the onslaught of private enterprise, but the quaintly-named State Enterprise of Cultural Production still has a shop selling wooden elephants and musical instruments near the local karaoke bars and the refurbished hotels run by Thai and Singaporean investors.

The North, too, has yet to lose its innocence. The bumpy journey to Xieng Khouang by road takes 24 hours in the dry season and is sometimes interrupted by bandit attacks. Western tourists who fly there – if they do not mind the heaps of watering-cans and other baggage blocking the emergency exits of Lao Aviation’s old Chinese propeller aircraft – are referred to by the diminutive women selling textiles, buffalo meat or beeswax candles in the village markets as ‘the big people’. Cars are so rare on the main road that the children shout, ‘Car! Car!’ when they see one coming.

It is a sparsely populated country and Laos’s neighbours are looking covetously at the plentiful land and barely exploited natural resources. Peasant farmers from crowded Vietnam often drift across the border and have to be rounded up from time to time and sent home. Australia has spent thirty million US dollars on the first bridge across the lower Mekong between Thailand and Laos at Nong Khai. This ‘Friendship Bridge’, due to open in April, and the new road north from Vientiane to China, whose construction is being financed by other donors, will open a through land route all the way from Singapore to the Chinese province of Yunnan. Not surprisingly, land prices in Nong Khai have risen fifty-fold in the last few years as Thai entrepreneurs, already notorious for their rapacious logging and gem-mining in Thailand, Burma and Cambodia, contemplate the commercial opportunities presented by a more open Laos.

The Lao Government is of course wary of these Thai investors. Lao officials have only to cross the Mekong to see the deforestation, pollution and prostitution which rapid industrialisation and mass tourism have inflicted on Thailand. ‘Thailand has been a fantastic example to Laos of what not to do,’ a foreign diplomat remarks. On the other hand, Laos is one of the poorest countries in the world – its main exports are hydroelectricity sold to Thailand and clothes made in foreign-owned sweatshops round Vientiane – and its inhabitants find it almost impossible to resist the lure of Thai money. Sympathetic foreign businessmen observe the way the Thais persuade their Lao counterparts to sign unfavourable contracts and laugh at them behind their backs. ‘The Lao are naive,’ said one. ‘They are fascinated by the money and they sign.’

Money and ideology apart, the Lao and Thai cultures are very close to each other. Ever since the period of French colonial rule there have been more ethnic Lao people living in north-east Thailand than there are in Laos itself. The two languages are mutually comprehensible, and the Lao who are within range of Thai broadcasts avidly watch Thai soap operas on television and listen to Thai radio, so much so that Lao speech is said to be taking on more and more Thai characteristics. In riverside villages, posters of Thai pop stars and actresses are pinned up on verandah walls next to pictures of a frowning Lenin.

Not all the changes can be blamed on Thai businessmen. A combination of rapid population growth and the traditional slash-and-burn agriculture of the hill-tribes has done as much damage to the Lao countryside as logging. With spare land in short supply, farmers in some areas return to the same ground every three or four years instead of letting it lie fallow for a decade, thereby reducing yields of corn and other crops. Aid workers believe that a three-year-old drought in parts of the North has been caused by the deforestation of watersheds, which can no longer absorb rainwater and release it gradually during the dry months.

The cinema in Phonsavanh, capital of Xieng Khouang province, has closed because people watch videos instead. Even in rural areas, women have started to wear jeans instead of the elaborately decorated, handwoven wrap-around skirts which are one of the hallmarks of life in Laos. The authorities are fighting what may turn out to be a futile rearguard action to avoid their neighbours’ mistakes and preserve something of their own culture and natural resources. In the first message of its kind in the country, Lao television recently pictured a woman weaving traditional cloth and lamenting the wearing of jeans by young women; a fashion, the weaver said, which would deprive Laos of both jobs and its soul.

There have been small victories. Foreign residents in Vientiane successfully lobbied the Government to prevent Thailand’s Siam Commercial Bank from knocking down an elegant French colonial building and replacing it with a new office in the centre of the capital. The bank’s representatives were outraged when they discovered what had happened, and accused the Government of kowtowing to interfering foreigners. In the peaceful northern town of Luang Prabang, the cultural heart of Laos, the Government has declared a preservation zone in the old quarter of temples, villas and shophouses, but even so the post office was recently and mysteriously replaced by an ugly new building, and, worst of all, the construction of the road to China threatens to turn the town into a trans-lndo-china truck stop.

Santi Inthavong, the French-educated owner of Luang Prabang’s Villa de la Princesse Hotel (his wife is a member of the Lao royal family), is one of the many Lao citizens who worry about the effect the new Australian bridge will have. ‘Our problem is how to develop and preserve at the same time,’ he says, munching fried Mekong river weed – a Luang Prabang speciality. The inhabitants of Vientiane, he believes, already think too much about money. He recalls arriving in Luang Prabang for the first time in 1989 and meeting a man who offered to show him the way to the Xieng Thong temple. ‘I reluctantly agreed, thinking it was like Thailand,’ says Santi. ‘When we got there I took out my wallet and attempted to give him some money. He was really offended. It was my first lesson.’ Further lessons were given by the mechanic who twice refused payment for mending his car. On the third occasion, Santi pressed a packet of cigarettes on him; the mechanic took one cigarette.

Even Luang Prabang cannot remain innocent for ever. The other day a group of tourists were confronted at the market by a Buddhist nun who wanted them to take photographs in exchange for money. Santi suggests that Laos should follow Bhutan’s example and strictly limit the number of tourists. ‘This is still a sleeping country,’ he says. But Laos won’t be allowed to sleep much longer. The economy is growing fast. Soon there will be good roads, more telephones, more hotels, more tourists and more factories. According to the measures used by UN and World Bank economists, the people will be richer. But in the long run the effects of tourism and commerce are likely to be profound, and in a very different way as damaging, as the American bombing in the Sixties.

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