Laos remains one of the poorest countries in Asia where two out of three people live in abject poverty. Now the country is opening up to the outside world after years of political seclusion but is the government ready to uplift its poor people?

It is still midmorning in Vientiane when we arrive at Dongsavath, a small village just about half an hour drive outside the city. We have come over dusty and potholed roads, passing women and children walking barefoot with water jugs. In this rice-growing region of the poor, landlocked country in Laos, families cling to life in an unforgiving terrain. This year has been a lot more difficult than usual because the rains have failed.

One man we meet in front of his hut has nine children. His small farm plot, not quite half a hectare, would be too small to feed his family even if rains had been plentiful. This year, because of little rain, he will get almost nothing. But Pheng Tanmisay, 62, is no ordinary man. He is the village president of the Lao Front for National Construction, a mass organisation which oversees religious policy and helps with development work in Laos.

“At least I am earning something,” he said of his situation, looking around contentedly. “There are people out there who have nothing.”

Pheng is crouched on a stool, close to the small fire being tended by his wife. She reaches into her apron and pulls out a handful of semi-rotten millets, which will be the basis for the gruel she will prepare for the meal that evening. It will be the a meal the children will have that day.

Like its neighbour Cambodia, Laos has a tragic past. It was the most bombed country during the Viet Nam War between 1959 to 1975 that has left a legacy of poverty and underdevelopment for its people. The plight of Laos has been rightly described by the Asian Development Bank in its latest report, which says that nearly 6 million people in Laos, two out of three live in abject poverty, living on less than US$2 a day. Laos remains a country with primitive infrastructure. It has no railroads, a rudimentary road system and limited telecommunications, though the government is sponsoring major improvements in the road system with possible support from Japan.

Outside the capital, many people live without electricity or access to basic facilities like clean drinking water. Agriculture, dominated by rice cultivation, accounts for about half of the country’s GDP and provides 80 per cent of total employment.

On the streets of what remains one of Asia’s sleepiest capitals, it’s hard to feel any immediate pressure for change. But long-time Lao observers like senior Thai journalist Kavi Chongkittavorn says the Lao government is beginning to open up and trying to work closely with Asean countries.

“Laos has ended its isolation when it joined the alliance of Southeast countries—Asean—and now the biggest challenge for the Lao government is to work more closely and openly with the rest of region and world,” says Kavi, adding that the Lao government has benefited from regional cooperation.

In some respects that seems true. The UNDP Human Development Index indicates that Laos has shown consistent improvement being ranked 141 out of 173 in 1993 and climbing to 133 by 2007. The Global Economic Prospects 2008 of the World Bank estimates that Laos’ gross domestic product is expected to see growth of 7.9 per cent in the year 2008, which is higher than Indonesia (6.3 per cent) and the Philippines (6.2 per cent). The National Socio-Economic Development Plan predicts that the country could achieve the UN Millennium Development Goals target of reducing the proportion of people living below the poverty line by half by 2015.

According to the Ministry of Planning and Investment of Laos, foreign investments in the country have now passed the $6-billion mark, with Thailand leading the way by investing more than $1.35 billion in 169 projects, followed by China with $1.138 billion and Viet Nam with $535 million. However, China is expected to surpass Thailand in 2008, becoming the number one investor in Laos.

Savankhone Razmountry, the editor-in-chief of Vientiane Times, a state-owned newspaper, says despite the government’s efforts and commitment to the development of the country and social upliftment of its people, the foreign media is still giving a negative coverage to Laos which, he says, is unfortunate.

“It is not good that we should criticise all the time. Rather we should encourage change and try to help each other onto the ladder of development,” says Savankhone.

Today, Laos is banking on its rich natural resource like water to boost its economy and build new infrastructure. Already under construction, the Nam Theun 2 dam is one of the biggest projects in the region. Located in the central Lao provinces of Khammuane and Bolikhamzy, the $1.45-billion-project is scheduled to be completed at the end of 2009. The World Bank sees this as a model project. It says that the money earned from this dam will help Laos alleviate poverty. Thailand alone plans to import more than 90 per cent of its electricity needs from the dam, earning the Lao government about $1.9 billion over the next 25 years.

“For Laos, hydroelectric power is a highly lucrative venture,” says Savankhone. “It is going to bring a lot of development and prosperity into our country. The money generated from this could be used to alleviate poverty.”

But there are serious questions as to whether hydro-electric power projects will truly benefit the locals, or simply help make their government richer. A foreign businessman in Vientiane puts it like this: “The problem in Laos is not lack of money and foreign investment but mismanagement and corruption.”

But many local entrepreneurs are doing what they can. Taykeo Sayavongkhamdy, who owns Taykeo Textiles Gallery in Vientiane, spoke with dignity about the challenges facing entrepreneurs.

“I want to spread my business outside Laos and involve more people into it. There is a good market for our handicrafts. But we need more help and support from the government,” she says without criticising the government.

As we proceed through the city, the streets are abuzz with people and energy. There is a new openness to life as the government is bringing much-needed revenue into the country’s fledgling economy after years of political seclusion.

Now the challenge before the government is to make sure that the people of Laos are not left behind in the country’s economic growth.

“We want our country to develop like Thailand and our other neighbours,” farmer Pheng said as he rose from his knees. “I don’t want my children or grandchildren to face the same hardships and difficulties which I faced in my life. They should have a good life.” (By SYED NAZAKAT In Vientiane/ ANN/ AsiaNews)