"Will Laos' economic zones boost growth or bring in criminals?" An article by Nikkei Asia just has asked this question. The answer is open for Boten, the city at the last station, before the new Lao-China-Railway crosses the frontier between Laos and China. The new railway line from Kunming in China to Vientiane in Laos has opened a new trade route in Southeast Asia. Boten City has become a more important logistic hub.
Investors are seeking to reinvent the town of a few thousand people as a cross-border commerce hub. Experts, however, say the project is built on shaky economic foundations and therefore a possible subject for criminal activities. "The town has huge potential even without a casino," Siphone Kongchampa, the head of the Boten Special Economic Zone (Chinese: 磨丁经济特区) told Nikkei Asia. The SEZ is expected to expand to more than 16 square kilometres to host businesses from financial services to healthcare, Siphone said. The zone’s developer, the Yunnan-based Hai Cheng Group 云南海诚,a real estate company, says it plans to invest $10 billion to turn Boten into a city of 300,000 people. "That vision is a long way off, with the town’s main hub today consisting of about three square kilometers of Chinese restaurants, gambling halls, hotels and tower blocks", writes Nikkei Asia.
Picture update 2023, One of the largest infrastructure investments in Laos, the Boten Special Economic Zone (SEZ) is a 10-billion-USD Chinese-built and funded zone. pic.twitter.com/WmziBFepIi
And there are doubts, expressed by Jason Tower, an expert on transnational crime and security issues in Southeast Asia at the United States Institute of Peace. He told Nikkei Asia: "Given the economic changes post-pandemic, given the slowdown in the Chinese economy, I don’t see how Boten is going to be successful unless it starts veering towards illicit businesses." The government of Laos has so far not controlled what occurs inside some of its SEZs, therefore concern is growing, that transnational crimes like money laundering, drug trafficking and online scams are facilitated.
"The center of Boten has an eerie feel to it. Everything in this border city in northern Laos looks huge: High-rise offices tower over wide, straight highways; vast hotels sit next to expansive duty-free stores. But all of these buildings sit in near total silence", wrote Sixth Tone in September 2023. "The only signs of life come after dark, when the karaoke bars and nightclubs open, and the crooning of middle-aged Chinese men fills the air."
Zhou Kun, chairman of Yunnan Haicheng, was appointed chairman of the Laos Boten Special Economic Zone Management Committee. He tries to develop clusters of commercial finance, logistics and processing, education and medical care and cultural tourism in Boten. But until now only in the the commercial and financial district new buildings have been constructed.
Along the Mekong in Laos, on the border with Thailand, Myanmar and China, lies the "Golden Triangle Special Economic Zone" (Chinese: 金三角经济特区; Lao: ເຂດເສດຖະກິດພິເສດສາມຫຼ່ຽມຄຳ). If you spend just a few minutes there, you'll quickly realize that it's an area that Laos does not control. Who does? The zone has an area of about 3,000 hectares and was created in 2007 by the Lao government together with the Chinese-owned Hong Kong-registered company Kings Romans Group with the hope of generating economic development. A casino and hotels are the main attractions. But the zone has gained a reputation of being a Chinese city rife with illegal activities such as drug, human and animal trafficking, as you can read on Wikipedia. In January 2018, the United States Treasury Department sanctioned Kings Romans, its owner, Zhao Wei, and the "Zhao Wei Transnational Crime Organization," alleging the casino was used to launder money and traffic drugs, among other serious crimes. That's why holders of American passports are not allowed in, as this video docoumentations shows:
Another documentary bei International Crisis Group about the Golden Triangle Special Economic Zone: Inside South East Asia’s Criminal Empire.
Kings Romans Casino in the Golden Triangle Special Economic Zone along Mekong river in Laos
Fears are rising over Myanmar-based scam groups relocating to Laos due to crackdown in Myanmar, pushed by China, reports rfa.org. In recent months China has intensified a crackdown on online scams operated by criminal syndicates in forced labour camps in border areas of military-ruled Myanmar. “There have been growing concerns that many of these scam groups might opt to relocate their operations to Laos, especially to its Golden Triangle area,” a source who wished to remain anonymous for security reasons told Radio Free Asia. South Korea therefore has decided to impose a travel ban for the Lao Golden Triangle Special Economic Zone (SEZ) from Feb. 1.
In December, the Lao authorities deported 462 Chinese nationals for offenses including human trafficking from the Golden Triangle SEZ according to rfa.org. in mid-September 164 Chinese nationals, including 46 arrested in the Bokeo Special Economic Zone were sent back to China. The Golden Triangle Special Economic Zone (SEZ) was established in 2007 in the northern province of Bokeo on a 3,000-hectare concession along the Mekong River. it has also earned a reputation as a haven for criminal activities, including prostitution and drug trafficking, reports rfa.org. Impoverished young people from Laos and neighboring countries have told Radio Free Asia they were lured to the area with the promise of a lucrative job but were then held against their will in casinos by trafficking rings that exploit them under threat of violence.
Lao authorities currently do not have the right to enter special economic zones to conduct investigations, notes rfa.org.
By <a href="//commons.wikimedia.org/w/index.php?title=User:SaiLp&action=edit&redlink=1" class="new" title="User:SaiLp (page does not exist)">SaiLp</a> - <span class="int-own-work" lang="en">Own work</span>, CC BY-SA 4.0, Link
The skyline of the Golden Triangle Special Economic Zone on Mekong river
To the criminal networks, the casinos in Laos, Myanmar and Cambodia are the new banks, allowing them to launder money on a vast scale away from scrutiny and with little likelihood of law enforcement catching up with them, according to a report released in January by the UN Office on Drugs and Crime (UNODC), writes South China Morning Post. The government of China has painted an alarming picture of a Mekong region studded with casinos that are a crucial cog in the money-laundering machines engineered by gangsters in Taiwan and Macau, including the infamous 14K Triad and Taiwan’s Heavenly Way Alliance.
Zhao Wei (赵伟) is the owner of the Dok Ngiew Kham Group and co-owner of Hong Kong SAR-listed Kings Romans International (HK) which operates the Kings Romans casino in Laos. He is also the chairman of the Golden Triangle Special Economic Zone (GTSEZ). In the UNODC-report you can read: "Zhao Wei’s network of criminal connections in Asia has been solidified through his close association as a purported member of the 14K triad. In January 2018, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Kings Romans and Zhao Wei, declaring his network a ‘transnational criminal organization’ and imposing sanctions on him and three associates as well as three of his companies based in Lao PDR, Thailand, and Hong Kong SAR. In addition to drug trafficking, the U.S. Treasury also alleges that Zhao’s network engages in human trafficking, wildlife trafficking, money laundering, and bribery, much of which is facilitated through Kings Romans." in December 2023, authorities in China and Lao PDR executed a joint operation targeting confirmed cyberfraud operations, raiding seven business offices and arresting 462 suspects in the Golden Triangle SEZ. Zhao Wei has denied the allegations that illegal activities took place in the zone.
But by a visit in 2023 the International Crisis Group identified four guarded high-rise buildings with barred windows and high fences wrapped in razor wire. "Locals told Crisis Group that people were locked inside and forced to work as online scammers", you can read in "Stepping into South East Asia’s Most Conspicuous Criminal Enclave".
Zhao Wei (red dress) in a picture from November 2019
According to Prof. Dr. Pinkaew Laungaramsri from the Faculty of Social Sciences at Chiang Mai University Zhao Wei has also invested in KK Park in Myanmar, a hub for scam operations and other crimes near the border of Mae Sot district in Thailand. She told https://transbordernews.in.th/: “One of the KK buildings, the KK4, as far as we know, has been made possible by the joint-investment with Kings Romans. Basically, Zhao Wei has purchased and invested in the project. Why did he buy the building? Obviously, because it is a hub of all the call-center gangsters and the connection is there.” The Professor said also: "At present, people lured to work with the call-center gangsters have been sold off to the Golden Triangle gangs and ended up in the area opposite to Mae Sot District. They are initially shipped through a boat ride to Tachileik and then transported on to Mae Sot District."
Finally it's possible to travel on railway from Kunming in China to Vientiane in Laos: On April 13 the first trains left Kunming and Vientiane and arrived 10-and-half-hours later at their destination. The 1,000-kilometer rail line, which links the capital of China’s Yunnan province to the capital of Laos, had been completed in December 2021, but due to Chinas’s strict “zero COVID” policies, the border of China and Laos could not be crossed.
Now the fast train between Vientiane and Kunming South Station is running daily in both directions, starting at 8:08 am and arriving at 19.38 in Kunming (China time) and 17.38 in Vientiane. First class tickets for the full journey are available for 760 yuan ($110) while second-class tickets are priced at 470 yuan ($68). Laos-China Railway Company Limited (LCR) have launched an App on Google Play, iOS and Huawei to allow passengers to purchase LCR train tickets on their mobile phones using UnionPay cards. The service is operated with green bullet trains of China Railway and the Lanexang EMU trains of Lao-China-Railway. Find more informations on Hobomap.
For the border checks the passengers have to leave the train in Mohan (China) and Boten (Laos) with all their belongings. The stops will take 90 minutes.
The China-Laos Railway started cross-border passenger services last Thursday, with the first passenger train departing from Kunming, the capital of southwest China's Yunnan Province, and heading for the Lao capital Vientiane. pic.twitter.com/efhw3Q85Qq
As locals await relocation and environmentalists raise concerns over impacts on the Mekong’s ecology, the future of the planned Phou Ngoy dam (also called Lat Sua) looks uncertain, "The Third Pole" reports. The run-of-river-dam is planned on the Mekong River in Champasak Province in Laos, about 18 km downstream from Pakse. The project for producing 728 Megawatt of electricity has been developped by Charoen Energy and Water Asia Corporation of Thailand (CEWA) and the South Korean construction companies Doosan Heavy Industries and Construction and Korea Western Power. The dam structure would be 1,300 meters long and 27 meters high with a head of 10.6 meters.
Visualisation of the Phou Ngoy Hydropower Project by CEWA
How many villages along the Mekong are affected?
The US $2.4-billion dollar project would impact more than 200 hectares of land and 88 villages, 57 villages above the dam and 31 below. The most-affected village would be Ban Khonken fishing village, where 811 residents reside in 142 households. They have been told that they will have to relocate for the construction works.
Is there an impact on Vat Phou Unescco World Heritage site?
An official at the Lao Ministry of the Information, Culture and Tourism said according to rfa.org he was worried about the dam’s impact on Vat Phou, a Khmer Hindu temple complex about six kilometers (3.7 miles) from the Mekong River. “If the Lao government and the Phou Ngoy Dam developer really want to build this dam, they’ll have to do the Heritage Impact Assessment, similar to the one for the Luang Prabang Dam Project that has been submitted to UNESCO,” he said.
Is Phou Ngoy Hydropower project economically feasable?
There are doubts, as "The Third Pole" reported in Dezember. Yongpil Seo, country director of the Thai office of Doosan Enerbility, one of the Korean partners, said he thought it was “unlikely” the Korean partners would continue with the project, adding he believed CEWA is currently looking for lower-cost Chinese partners and is struggling to find investment. No power-purchase agreement (PPA) with the Thai state enterprise Electricity Generating Authority of Thailand (EGAT) seems in sight.
Another interruption of the free flow of Mekong river and the way for its fish population; more than 1200 families are forced to move their homes and income resources, and the earthquake risk for the historic town of Unesco-protected Luang Prabang is rising: The construction of a highly controversial hydropower project in Laos has begun. The energy shall be delivered to Thailand.
The development cost of the 1,460-Megawatt facility is estimated at U.S. $ 3 billions. The run-of-the-river dam is planned about 25 kilometers upstream from Luang Prabang, at Houygno village according to the website of Mekong River Commission, located by the upstream Pak Beng hydropower project and the downstream Xayaburi project. The energy will be produced by 7 turbines or generators, each delivering 200 Megawatt. See this introduction video:
Who is behind the Luang Prabang hydropower project?
The Luang Prabang Power Company Limited (LPCL), a company established by Lao PDR and PetroVietnam Power Corporation, is the project developer, finances it and will operate it. In late 2020 an ownership change occurred with the stock ownership of Luang Prabang Power Company Limited changed to the following: PT Sole Co., Ltd. 38 percent; Petro Vietnam Power Corporation 10 percent; CK Power Public Company 42 percent and CH. Karnchang Public Company Limited 10 percent. CK Power Plc (CKP) is the power generation arm of the Thai construction firm CH Karnchang Plc, which built the Xayaburi Dam. So a Thai company is the major shareholder . in July 2021 LPCL signed the Concession Agreement of
the LPHPP with the Government of the Lao PDR, for a concession period of 35 years. LPCL has signed a tariff Memorandum of Understanding with the Electricity Generating Authority of Thailand (EGAT). EGAT shall be the off-taker of all electricity generated by the Luang Prabang hydropower plant from the scheduled Commercial Operation Date (January 1, 2030).
What happens tro the people living around the dam area?
More than 1,200 families in Oudomxay province will be forced to move to make way for the project. The dam will flood a dozen villages on the bank of the Mekong River in Nga district, including Lath Han, Khok Phou, Yoiyai and Phonsavang. Also residents of Houei Yor village, Chomphet district, in Luang Prabang province are affected. Residents of Nga district in Oudomxay province and Chomphet district in Luang Prabang province say authorities are shortchanging them for the land and other property they would lose. Oudomxay officials offered 100 million kip (U.S. $8,500) per hectare of farmland to locals, said a Nga district resident.
What happens to the historic town of Luang Prabang and ist famous temples - a UNESCO World Heritage Site?
Unesco has demanded a Heritage Impact Assessment, because there were concerns. Dams will encircle Luang Prabang’s urban area. " I can see a nightmare scenario where dam operators aren’t talking to each other, a massive weather event pours through northern Laos and sudden dam releases from these dams cause an unnecessary flooding event around Luang Prabang,” said Brian Eyler, director of the Stimson Center’s Southeast Asia programme. “The Xayaburi dam would act like a plug in the bathtub, not allowing the water out to the downstream if its flood responses weren’t ready for those sudden upstream releases. It’s a complicated but possible scenario.” The Luang Prabang dam would be the first in the Lower Mekong Basin to encounter water discharged from the 11 mainstream Chinese dams, including the massive 5,850 MW Nuozhadu dam. Upstreams of Luang Prabang the Mekong also merges with the Nam Ou, a river with a cascade of seven hydropower dams built by PowerChina.
By signing the World Heritage Convention, countries pledge “not to take any deliberate measures which might directly or indirectly damage the natural and cultural heritage” of a site and to “ensure the protection and conservation of their Outstanding Universal Value and other heritage values.”
The dam will be built in an earthquake-prone zone. “We are very worried about the seismic fault only 8.6 kilometers from the Luang Prabang dam site,” said leading Thai seismologist Punya Churasiri. “It is too dangerous to go ahead with this project.”
How is the progress of the construction works so far?
อัปเดต 2023, โครงการก่อสร้างเขื่อนหลวงพระบาง ห่างจากมรดกโลกหลวงพระบาง ประมาณ 25 กม. **โดยทุนไทย** - Update 2023, Construction work has begun on the Luang Prabang hydropower dam on the Mekong River in Laos.#เขื่อนหลวงพระบาง#แม่น้ำโขงpic.twitter.com/o4QkhN5Q6y
In March 2021 Xinhua reported that the preparatory work was already 80 per cent complete. Among the work was the construction of an 11-km access road, a 500-metre bridge over the Mekong River, three temporary ports, as well as some transmission lines and a small electricity station. Bangkok Tribune shows pictures of the construction progress.
What could stop the construction of Luang Prabang hydropower plant?
The dam has been criticised by environmental groups and the government in Thailand, which will feel the effects on its Mekong border with Laos and beyond. “Surely effects for Thailand include fish loss, the fluctuations of dams cutting the river ecology, the unnatural water flow and the sediment loss until the water becomes blue,” said Niwat Roykaew of Thailand’s Chiang Khong Conservation Group, adding that it will impact fishing communities. Thailand’s authorities have received pressure from environmental groups to not purchase power from the Luang Prabang dam and other projects. But: "Environmental and heritage reviews are unlikely to stop the
Lao government forging ahead with its hydroelectric plans", wrote Milton Osborne.
Updated informations about Luang Prabng hydropower plant you can find on Hobomaps.
Trip in a local train (green train) from Vang Vieng to Kasi with sights
See the timetable and fares on Hobo Maps. They update the timetable every month.
Tickets can be purchased up to 3 days in advance at the stations and each person can only buy 3 tickets at a time. You have to present passenger identification documents and Covid-19 vaccination certificate, your name will be printed on the ticket. Payment must be in cash. If you don’t have a ticket, you should arrive at least two hours before departure time because you have to queue for ticket purchase and again for entry to the station and then go through security checks.
There are also ticket sales offices in central Luang Prabang and on the ground floor of the shopping mall Vientiane Center in central Vientiane. Each person can only get 2 tickets. Payment can only be made by UnionPay card or by QR Code (OnePay, UnionPay, Alipay and Wechat) at a POS machine. A service fee of 20,000 kip per ticket is charged. Hours are 10:00 am to 12:00 noon and from 12:30 pm to 15:30 pm each day.
Discover Laos Today offers a online ticket booking system for Laos-China railway. In Vientiane you can self-collect the ticket at Discover Laos Today office at ASEAN Mall from 9 am to 5 pm or they deliver to your hotel for 3$/way. In Luang Prabang you can self-collect at Discover Laos Today office at MyLaoHome Hotel and Spa behind Joma Bakery from 9 am to 5 pm or you get the ticket delivered to your hotel.
The Laos-China Railway Company Limited's Facebook page has info on how many tickets remain available for sale. https://www.facebook.com/LaosChinaRailway/
On the fast trains passengers are allowed to carry a baggage up to 20 kilogram. On ordinary trains there is no baggage limit.
