VOLATILE TERRITORY: THE MEKONG RIVER REGION

The Mekong River weaves together a rich network of cultures and resources formed through the development of ancient imperial civilizations, European colonization, and various waves of forced interventions by China, North Vietnam, and the United States.  What unites the nations of Indochina are various processes of war and resource exploitation.  The Mekong River has always been the central figure in this turbulent diagram.  The River as a figure and the forms that have evolved from it are now threatened due to recent developments in trade relationships between China and the countries of Indochina who continually suffer from economic mismanagement and natural resource exploitation.  This paper seeks to illustrate the network of various systems active in the region and project the potential reverberations of events already in motion.

Fractured Economies

Laos is run by a one party Communist regime that is nearly bankrupt and does not have the legal and regulatory framework normally required by private investors.  It is one of the ten poorest countries in the world, keeping company with Rwanda, Bangladesh, and Bhutan, with half of its citizens living below the poverty line.  Foreign aid has increased in Laos since 1980, currently comprising 45% of the national budget, of which 40% goes directly to government payroll.  Poppies are the countries most lucrative agricultural product, while the sale of Teak comprises 39% of the countries export earnings.  Its greatest resources lie in its mineral deposits of tin, gypsum, coal, oil, iron ore, copper, and gemstones.  Several international oil companies are exploring Southern Laos.  Tourism has also expanded from 14,400 people per year to over 500,000.  Laos is also attempting to harness electrical power for export to Thailand, although Thailand actually has a power surplus.

In 2001 Cambodia’s entire budget consisted of foreign aid, mostly from the World Bank and IMF.  The garment industry currently makes up 70% of Cambodia’s exports, while logging contributes the rest.  In 1998 the government received 6 million in revenues from logging, the Asian Development Bank estimates that given the rate of deforestation that number should have been $40-$60 million.  In 1999 the Asian Development Bank drew up a report on Cambodia’s economy, and concluded that if the current pace of deforestation were maintained

the country would be completely logged out in five years’ time.  The government in Phnom Phenh has fostered a culture of impunity that has allowed illegal logging to persist: additional costs are soil erosion and sediment flowing into the Tonle Sap and Mekong (Osborne 260).   Currently 50% of revenues are spent on the military, while health expenditures are 2%.  Vast quantities of revenue are siphoned off by the powerful and well connected in with the government.

Myanmar is run by the Junta military regime, who operates by force behind a completely opaque economic system, strained by more than a decade of sanctions, corruption, and mismanagement.  The country is in a constant struggle with inflation that bounces between 13% and 50%.  The drug trade is deeply rooted in Burma’s economic structure.  By allowing drug traffickers to buy legitimate businesses in the country has managed to stave off several complete economic collapses.  The U.S. State Department’s International Narcotics Control Strategy report identified money laundering and reinvestment of narcotics profits laundered elsewhere as “significant factors in the Burmese economy (Zaw, Sai).”

The CHINA - ASEAN Free Trade Area

In 2002 China signed a conditional agreement with Southeast Asia establishing a China-ASEAN free trade area.  China’s economy is growing at a rate of 10%, while the countries of Indochina are currently between 0%-3%.  ASEAN members, particularly Japan, see China as a major competitor rather than partner and fear it may take away foreign investment (Spillius).  As apart of a vigorous go west policy China has already established Myanmar, Cambodia, and Laos as spheres of influence dependant on Chinese investment and aid.

As a part of their condition of entering ASEAN with Laos, Cambodia, Myanmar, Thailand, and Vietnam they are promoting several forms of development in the Lancang-Mekong River Sub-region.  They are encouraging the development of an economic corridor along the Mekong connecting with their Pan Asian Railway connecting Singapore with Rotterdam.  This plan also includes flood water management, and shipping agreements signed between Laos, Thailand, and Myanmar to allow vessels to travel from China to Luang Prabang.  Not surprisingly and despite widespread environmental concerns about dam construction on the Mekong, no criticism was leveled at Beijing during the ASEAN meeting of the six countries that lie along the River.  This they see as a form of cooperation between the countries of Indochina and China.  On the eve of the ASEAN summit in May they wiped out Cambodia’s estimated debt of $200 million and announced an aid package of $10 million to the country.  Another agreement was signed avoiding conflicts over the Spratly islands in the South China Sea.

The Mekong River

The Mekong is the twelfth largest river in the world stretching 4350 kilometers from its source in Tibet flowing through China and forming the borders between Myanmar and Laos, Laos and Thailand, Cambodia and Vietnam.  Over 60 Million people (80% of the population of countries involved) depend on the Mekong for food, water, and transport and supports one of the worlds most diverse fisheries, second only to the Amazon.  The basin covers: 86% of Cambodia, 97% of Laos, 36% of Thailand, and 20% of Vietnam.  It has been the single largest source of food, transport, and trade for all of the aforementioned countries, except China.  Only 7% of the land in Indochina is arable, all of which exists on banks of the river.  During the dry season the river deposits a fresh layer of fertile silt.  During the rainy season, the Mekong swells from snowmelt in Tibet and heavy rains along the river and its tributaries, so much that it actually begins to flow backwards up the Tonle Sap and into the Tonle Sap Lake of Cambodia.  It swells in size from 2700 square kilometers to 16000 square kilometers and is the largest freshwater lake in Southeast Asia, providing 60 percent of Cambodia’s protein intake alone.  Rice is the predominant crop which can be harvested as many as three crops per year in the Delta.

Dam Construction

To capitalize on the Mekong River’s potential to create electricity for growing industry China, Laos, and Thailand have begun massive dam building projects on the Mekong.  The first two dams were completed by China in 1993 and 1999, they have as many as thirteen more planned upstream from the countries who depend on the river the most.  Vietnam, Cambodia, Laos and Thailand have further plans for more dams along other tributaries of the river, Cambodia has plans for seventeen, and Laos has plans for fifty-six.  The built projects have already begun to have radical effects downstream in their attempts to ‘normalize’ the natural flooding processes of the river.

Dam Financing

The Nam Theun 2 dam on the Theun River, a major tributary of the Mekong in Laos is on hold, a project the World Bank planned to finance.  However, in the mean time, Laos began secretly building a new dam Nam Mang 3 with a non-concessionary loan from China.  The World Bank, IMF, and Asian Development Bank reacted against this and reportedly pressured Laos to stop construction since they had not made their process transparent and the dam was too small to be economically viable.  Some think the World Bank’s real concern is that poor implementation of Nam Mang 3 would cast serious doubts on the government’s capacity to implement the Nam Theun 2 project. 

Highway Construction

Japan and Thailand are interested in creating an East-West corridor across the Mekong allowing the transport of manufactured goods and natural resources from Japan, Southeast Asia, and Southern China to reach ports on the Indian Ocean in Myanmar (LoBaido).  This roadway will link the Myanmar capitol of Rangoon with the Laotian rice bowl at Savannakhet, and Vietnam’s Danang seaport on the South China Sea.

Located 400 km north of Vientiane, Luang Prabang is now threatened by additional threats besides further Chinese dam construction.  Luang Prabang is currently a quiet French colonial city with a well preserved collection of Buddhist temples whose 16,000 inhabitants experience rush hour when the children finish school and ride their bicycles home.  The end of the Thailand Laos war in 1988 has opened the country to an influx of tourism.  Due to the lifting of strict Visa restrictions, tourist travel in Laos has increased from 14,000 visitors per year in 1991 to over 500,000 in 1998.  A new highway connecting Vientiane and Luang Prabang now allows one day travel between the two cities and is bringing automobile traffic into a city free from the noise and air pollution of automobile traffic. 

Highway Financing

Japan began financing development in the Mekong region in 2000 in order to prevent another Asian economic meltdown similar to the one that was generated in Bangkok in 1997.  Emphasis on creating an “economic corridor” (the aforementioned East-West road) is very important, as are plans for providing the 250 million inhabitants of the region with electricity.  Working quietly behind the scenes with the governments of these countries to finance these infrastructural projects are the usual suspects: the Asian Development Bank, United Nations, IMF, World Bank, General Motors, General Electric, and the American Investment Group. 

Drug Trafficking

With the destruction of Afghanistan’s poppy crop in 2001, Myanmar has reclaimed its crown as the leading producer of opium and heroin.  Drug profits from the Golden Triangle reach into the tens of billions of dollars annually, authorities intercept less than 1 percent, and most is smuggled out via Thailand or China.  In 1998 Burma gave permission to the United Wa State Army (UWSA) one of the most powerful drug armies in Southeast Asia, to grow opium for the next five years.  Their empire grew rapidly, special relationships formed with Myanmar leaders, businesses expanded, and wealth accumulated.  Meanwhile the Myanmar army encourages villagers to grow opium so they can make them pay an opium tax.  The UWSA army continues to grow and its influence spreads while conflicts arise between Myanmar and its neighbors.

War

As drug lords roam freely in Myanmar and their empires expand, tensions have formed between Thailand and Myanmar.  The Thai’s have accused the Myanmar’s of waging a drug war on Thailand.  Thai drug enforcement officials believe about 700 million speed pills will come into to Thailand from Myanmar this year and claim that the UWSA runs an estimated 55 illegal laboratories on the border with the involvement of high ranking Myanmar military officers.  In early 2001 fighting broke out between the Thai and Myanmar’s near the Golden Triangle, the Thai used F-16 fighters to push back the Myanmar and Wa troops fighting together who occupied territory within Thailand (Zaw, Sai).

The Thai’s are unofficially rearming the Karen and Shan Rebels along the border with Myanmar, forming a buffer zone between the two countries.  The Shan army is now active in attacking drug traffickers and hands the seized drugs over to Thai officials.  In other words Thailand is exploiting the cultural differences between these tribes and their Myanmar neighbors to fight the infiltration of drugs into the country.  At the same time the tribes hope to maintain their existence by supporting the Thai government.  These are the same tribes they plan to pave through with the construction of the Pan-Indochina highway.  It is clear to see what small sparks could reignite these existing tensions.  Not surprisingly the U.S. is giving training to the Thai anti-drug task forces and has supplied Blackhawk helicopters to the army as a part of its “modernization” program.  The other aforementioned “modernization” element, the Pan Indochina highway, will further fragment the Karen and Shan resisting hill tribes and increase the mobility of drugs and military forces.

Hypothesis

The Mekong River’s role as a central figure in the Indochinese landscape will continue, its current use and the forms that have evolved from it over thousands of years may radically change.  These changes will permanently alter the economic, social, and regional systems that depend on its stability.  As dams and dredging continue on the Mekong and its tributaries the river will no longer sustain the millions of people that depend on it as a source of food, transportation, and way of life.  As the 60 million people living in the basin lose their fish and rice crops they will search for other forms of employment.  Many will enter the drug market where profits are the most lucrative and poppies will grow in the arid landscape nothing else will.  Incentives are good as the daily wages for the farmers are 12 times what a government clerk earns in Burma.  This will only serve to escalate the already fragile relationship between Thailand and Myanmar.  Some will migrate to the major city centers, particularly Bangkok, who has the most promise for income as the largest capitalist city in the region, a city already growing at a rate the city’s infrastructure cannot sustain.  Still others will turn towards the prostitution and child sex markets of Bangkok, Phnom Phenh, and Svey Paak where girls are sold for as little as $40 between brothels where at least 100 people contract HIV per day.  The UN placed the price on Cambodia’s AIDS problem at somewhere between four to six times the country’s total budget. 

The highways that are under construction parallel to and across the Mekong will accelerate the already out of control processes of deforestation while further mobilizing drug trafficking.  The upgrade in transportation infrastructure in the region will also allow for the increased mobility of China’s People’s Liberation Army within the region, particularly within fractured Myanmar.  Lost on this highway will be the indigenous hill tribes of the Christian Hmong and Karen, already marginalized due to their embrace of Christianity and resistance to the drug trade, Stalinism, Marxism, Fascism (LoBaido).

Michael Klare forecasts that the resource wars of the future will occur in the developing world - but their effects will not be limited to developing regions.  These conflicts will form in countries like Laos, Cambodia, or Myanmar where the national government is weak and corrupt while internal and external actors are competing for political power (Klare 222).  In this case the pawns are the Indochinese governments and militant groups like the Wa in Myanmar trying to milk the system for any funds they can, meanwhile China plays the biased referee ready to call all the players the cheats and reap the benefits.  Armed conflict will remain limited to skirmishes amongst militant tribes like the already competing Wa and Karen, civilians will suffer the greatest casualties, as has been in the case of Angola, Congo, Liberia, and Sierra Leone.  A handful of individuals in power will benefit while the rest will remain impoverished.

The major powers in the world will also feel the repercussions of these events.  Terrorism will become a common feature as soldiers will be deployed outside powerful countries to distant sites.  The presence of foreign troops in these resource producing regions will stir sentiments among those living in the area, America’s presence in Saudi Arabia is one such example resulting in the bombing of the Khobar Towers in Dhahran.  Using force to protect vital resources will prove very expensive, one fourth of the U.S. Defense budget, 75 million, was already allocated to forces in the Persian Gulf before the invasion of Iraq.  Russia, China, and Japan have also increased their spending to protect resource zones and transit routes, such as those along and cutting across the Mekong River. 

China’s interest in the Mekong river basin and Indochina is clear.  The more it encourages Indochina to exploit its own environmental resources, the more dependent the countries of Indochina will become on China’s financing.  As debt from the failed infrastructural projects China is encouraging accrues, China will be able to assume greater control over the region and begin exploiting the various mineral and petroleum resources of the region for its own use.  By controlling the economic future of these countries China will begin to gain control over Japan’s connections with Thailand.  The dependency of these countries on foreign aid will only perpetuate their need for more, unless they are absorbed or consumed by larger political powers, such as China and Japan. 

Alternatives

If the countries of Indochina wish to develop their own economic autonomy they need to begin investing in their existing functioning and sustainable resource, economic, and social systems that are already functioning rather than destroying them.  Arundhati Roy makes a plea for more modernity instead of less, and more democracy instead of less (Roy 12).  This is especially clear with the large dam projects that are actually obsolete in the efficient production of energy.  There are more economically viable and sustainable forms of generating electricity and managing water systems.  Their enormous costs often send a country into more debt than energy production can pay for in return revenue.  The heavy investment in infrastructure may only temporarily relieve symptoms of a much larger problem while spreading other existing problems the country or region is not equipped to handle.

Michael Klare asks for a resource-acquisition strategy based on global cooperation rather than recurring conflict.  Such a strategy would call for an equitable distribution of the worlds’ resources in times of acute scarcity, as well as an accelerated global program of research on alternative energy sources and industrial processes.  International efforts would be coordinated to conserve scarce commodities and employ material saving technologies.  He states that the key to making this strategy work would be the establishment of robust international institutions that could address major resource problems while retaining the confidence of global leaders and the public.  These institutions would inventory world resources and develop a mechanism for the allocation of resources in times of emergency or scarcity.  The scientific expertise of member nations could be pooled to develop sustainable energy practices, while in return they would be guaranteed access to materials in emergencies and new technology generated by the common research effort (Klare 223).  Such a strategy of cooperation cannot exist without its cheats and systemic flaws, but in the long run it may be more effective.

Currently there is the making of two such organizations who are currently observing and promoting responsible development along the Mekong: The International Rivers Network (IRN) and the World Commission on Dams (WCD).  However, both of these organizations remain focused too closely on the immediate

environmental effects and local population displacement problems.  If they were to broaden their critique of the effects of development to the greater picture at stake, they may find a wider, more responsive audience to aid in the resistance and education against irresponsible infrastructural and land use development.  They would strengthen their own viability and empower them to further organize world resources.  Despite their present shortcomings these organizations are the beginning of the formation of international institutions with the ability to observe, critique, and organize the worlds’ resources. 

Joseph Stiglitz argues for vertical forms of knowledge transfer in apprenticeship forms, stating that our knowledge is currently “tacit” and can only be transferred through horizontal methods.  He points out that the poor banking regulations and lack of transparency cannot alone explain the 1997 Asian economic crisis.  He argues there were also a number of flawed government policies encouraged by international financial institutions that led to the build up of vulnerability in short term debt (Stiglitz 10).  Knowledge in the form of “universal” and “best practices” by a central authority (World Bank, Country’s central government, etc.) impairs the self-esteem and self-efficacy of developing countries and local communities.  Top down procedures create a vicious cycle of dependence on universal knowledge principles.  In this he sees that we need to go beyond technocratic models and engage in what he calls “democratic social learning practices.”  Hardt and Negri illustrate this further, “the various struggles of the past 10 years (la riots, Zapatista revolts) have had to travel vertically because they are blocked from communicating horizontally, with each other, in order to recognize common problems.”  As a result their problems are viewed as symptoms of local problems rather than the global networks within which they revolve.  Even if these groups could communicate horizontally this would not be sufficient, they actually need the vertical.  This is the same verticality Stiglitz is promoting with forming a bottom-up structure of economic learning practices.  They also state that increasing the horizontal would increase the efficacy of these groups’ struggles.  The only way to resist empire is by engaging in the processes that create empire. It is a mistake to isolate local cultures in order to preserve them as this tends to isolate them further and obscures and negates real alternatives and potentials for liberation.

Manthia Diawara echoes this fundamental learning concept in his promotion of a regional imaginary in Africa.  The countries of Indochina face many of the same problems the Congo, Cote d’Ivore, and Cameroon face in terms of government corruption, resource mismanagement, and a general lack of faith in leadership - despite their historical differences.  Since 1989 the Laotian economy has slowly developed due to tolerance of black market trade.  Markets everywhere in Laos trade freely in untaxed goods from Thailand, China, and elsewhere.  As a result a small entrepreneurial class has developed, and is flourishing in cities along with communist officials thriving on bribes and kickbacks.  Diawara’s promotion of government investment in market development run by the people could begin to generate a viable economic form.  One that could form through the people’s own making and revitalize traditional cultures through their own forms of modernization rather than the ones imposed on them by the Asian Development Bank, IMF, World Bank, Chinese, and Japanese Financial resources that inevitably result in dependency and disintegrate cultural identity and individual or cultural motivation.  These forms of development cannot occur by exploiting and destroying the resources the people currently depend on, nor can they occur under oppressive and corrupt regimes.  These self-governed market structures can however, work to undermine the oppressive structure through their own corrupt forms, creating robust economic and social knowledge systems, eventually achieving their own financial independence.

Michael Kokora

Sources

ADB.  “Countries Bordering Mekong River Adopt New 10-Year Strategy.”  29 Nov 2001.  ADB.  Online Press Release.  14 Apr 2003.

Asia Observer.  “Burma: Country in Crisis.”  12 Mar 2003.  Online.  14 Apr 2003.

Hardt, Negri; Michael, Antonio. Empire.  London: Harvard University Press, 2000.

IRN.  “The Nam Theun 2 Hydropower Project in Laos.”  IRN.  Oct 2002.  Online.  24 Apr 2003.

IRN.  “China’s Upper Mekong Dams Endanger Millions Downstream.”  IRN.  Oct 2002.  Online.  24 Apr 2003.

IRN.  “Damming the Sesan River.”  IRN.  Oct 2002.  Online.  24 Apr 2003. 

IRN.  “The World Commission on Dams.”  IRN.  Oct 2002.  Online.  24 Apr 2003.

IRN.  “The ADB Creating Poverty in Asia.”  IRN.  Oct 2002.  Online.  14 Apr 2003.

IRN.  “IRN’s Nam Theun-Hinboun Campaign.”  IRN.  Oct 2002.  Online.  14 Apr 2003.

IRN.  “Whose Mekong Is It?”  IRN.  3 Nov 2002.  Online.  14 Apr 2003.

IRN.  “Unprecedented Protest in Laos Against Nam Mang 3 Dam”  IRN.  26 Mar 2003.  Online.  14 Apr 2003.

Jane’s Asain Infrastructure. “Indochina Signs up to Mekong Project Despite Looming Territorial, Environmental, and Financing Problems.”  12 Nov 2002.  Jane’s Information Group.  Online.  24 Apr. 2003.

Klare, Michael.  Resource Wars.  New York: Metropolitan Books Henry Holt and Company, 2001.

Kriner, Stephanie.  “Taming Southeast Asia’s Mekong River: A Recipe for Development or Disaster?”  16 Aug 1999.  Disaster Relief.  Online.  24 Apr. 2003.

LoBaido, Anthony.  “Money Talks on the Mekong.”  10 Apr. 2000.  World Net Daily.  Online.  14 Apr. 2003.

Mekong Monitor.  “Halt in River Blasting Could Harm Thai-Lao Ties.”  IPS News.  Online.  14 Apr. 2003.

Mekong River Dam.  11 Jan 1997.  TED Case Studies.  Online.  14 Apr 2003.

Osborne, Milton.  The Mekong.  New York: Grove Press, 2000.

Roy, Arundhati. War Talk.  Cambridge MA: South Bend Press, 2003.

Sai, Zaw; Mae, Aung.  “Drugs, Generals, and Neighbors.”  Jun 2001.  The Irrawaddy Publishing Group.  Online.  14 Apr 2003.

Spillus, Alex.  “China in L800bn Free Trade Deal.”  11 May. 2002.  News.telegraph.co.uk.  Online.  24 Apr. 2003.

Stiglitz, Joseph.  Joseph Stiglitz and the World Bank: the Rebel Within.  London: Anthem Press, 2001.

TCDC in China.  “Reflections and Proposals on Economic Cooperation in Mekong River Subregion.”  16 May 2002.  ECDC.  Online.  14 Apr 2003.

United Nations Office on Drugs and Crime.  “Myanmar Profile.”  UNDCP.  14 Apr 2003.  Online.  14 Apr 2003.