Vientiane, April 3, 2018
Big changes are taking place in Laos. In the north-western village of Ton Pheung, visitors can clearly see those changes. Its residents speak Mandarin. Local transactions take place in Yuan and clocks display Beijing time.
The changes are not unique to Ton Pheung. Villages across northern Laos are displaying similar characteristics. Chinese investment has poured into Laos. With it has come a Chinese way of life and increasing Chinese influence. But Laos is making some heavy sacrifices for its Chinese investment.
The decision to invest heavily in Laos benefits Beijing in two ways. Firstly, Laos is a pillar of the One Belt One Road strategy. Construction on the Kunming-Singapore railway began in 2016. The railway will connect China to Southeast Asia and beyond. The railway runs through Laos and depends on the nation for its success.
Secondly, by increasing its influence in Laos, Beijing can offset Vietnamese influence. Vietnam was the largest investor in Laos before 2014. It has traditionally enjoyed strong ties with the Laotian military. Undermining the Laos-Vietnamese special relationship will help further isolate Vietnam. Vietnam is a rival claimant in the South China Sea dispute. Beijing will welcome any erosion of Vietnamese military ties.
But the Chinese money comes at a price.