It's a bumpy road back for Lao exiles
By Stephen Kurczy
LUANG PRABANG - After decades in exile, Lao refugees who sought political
asylum in the West are now returning to their homeland, investing in business
and boosting an economy starved for educated and cash-rich entrepreneurs. Some
250,000 took refuge in the United States and tens of thousands more landed in
Europe, amounting to a far-flung Lao diaspora.
As Laos' communist leaders transition towards a market-driven economy, former
adversaries are being allowed to invest in the country's capitalist future.
Sommay Inthavong, who runs a French restaurant catering to upscale tourists in
Luang Prabang, is among the country's returned entrepreneurs. He was also among
the hundreds of thousands who fled the country when the Stalinist Pathet Lao
seized power in 1975.
Fearing harassment or worse from the new communist regime because of his work
in the country's pre-revolution interior ministry, Sommay moved to southern
France where he found
work as a dishwasher. He was later promoted to top chef, culinary skills he's
brought home to Laos. "I had to leave and go into exile," said the outspoken
64-year-old in a recent interview. "It was another life. I started out with
nothing."
He was not alone. Many educated Lao royals fled when the ideologically-driven
Pathet Lao abolished the monarchy. One young prince, Nithakhong Somsanith,
moved to Paris, where he earned a PhD in psychology from the Sorbonne and
joined a French government department treating Asian immigrants suffering
identity crisis.
Trained in gold thread embroidery as a youth in the Lao royal court, Nithakhong
used art therapy to help immigrant Asians seeking to understand their roots.
Eventually, he found himself also seeking to more fully comprehend his
heritage.
"To discover yourself and make sense of your identity - it's normal and human,"
he said at his home in Luang Prabang, where he now teaches gold thread
embroidery to Laos youth. "I need to make something for my country, my
culture."
That calling is luring many former Lao refugees home. While many other Asian
immigrants choose to move to the West in search of opportunity, Lao political
refugees were forced to leave, engendering a deep desire to return, said Peter
Kwong, head of Asian-American Studies at New York City's Hunter College.
"Laotians left in a rush to survive," Kwong said in a telephone interview.
"They left suddenly, and when they got to the US they didn't feel prepared,
they didn't fit in. After all these years, they are still basic refugees. So
when they have a chance, they want to go back."
Lao-American families have risen out of poverty and substantially increased
their incomes over the past two decades. Median income among Lao-American
families rose from $23,000 in 1990 to $56,441 in 2007, according to the US
Census Bureau, although this was still below the national median average of
$61,173. Meanwhile the percentage of Lao-American families below the poverty
line dropped from 32% in 1990 to 12% in 2007.
As these former refugees now approach retirement age, many of them are taking
their savings and returning home, said Vinya Sysamouth, executive director of
the Center for Lao Studies in San Francisco. More than 500,000 Lao currently
live in the US, and Vinya estimates that 20,000 to 30,000 Lao-Americans have in
recent years returned permanently or semi-permanently to Laos.
"The people who go back usually do small businesses, setting up dental offices,
mechanic shops, car dealerships, hotel-guesthouses," Vinya said by telephone.
"I know so many people retiring and living in Laos. My parents want to go back,
maybe in the next five to 10 years. My father wants to die in the country he
was born."
Laos' first privately owned and operated publication, a business magazine
called Update, was started by a returnee from Hawaii. Mana Southichack, 41,
left Laos in 1981 when his father, a soldier with the pre-communist government,
was released from a labor camp. Mana returned to Laos in 1998, intending to
teach at a university but he was denied the position because he was not a Lao
citizen, despite his PhD in economics from the University of Hawaii.
Determined to stay, he founded Update and began a private business consultancy.
"People living outside of Laos have a lot more exposure to what's going on in
the market, what's being sold. So they see the business opportunities [in
Laos]. They see the gap and they try to take advantage of that," Mana said.
Economists say the growing number of returnees could help rebuild one of Asia's
poorest economies. "It will have a huge impact across the board" if expatriate
Laotians return home, said Ekaterina Vostroknutova, senior economist for Laos
at the World Bank. "There are not enough educated managers [or] high-skilled
people in the country."
Unskilled boom
Laos' real gross domestic product (GDP) growth averaged 7.3% between 2003 and
2008, driven by mining, hydropower and commercial agriculture activity,
according to the Asian Development Bank (ADB). (GDP growth is expected to dip
to 5.5% in 2009, as key exports of clothing, hydropower and minerals fall in
line with the global slump.)
Per capita incomes climbed to $840 in 2008, from $581 in 2006, and private
investment levels climbed to 33% of GDP in 2008 from 24% in 2006. The fast
growth lifted many out of poverty, which fell from 33.3% of the population in
2003 to 27.1% last year.
"There is a very stable political environment, economic growth has been
impressive and the social climate is the safest anywhere. These are key aspects
which are boosting investor confidence not only to foreign investors but also
to diaspora Laos," ADB country economist Christopher Hnanguie told Asia Times
Online.
The World Bank's country overview notes that Laos "faces significant capacity
challenges, in both the quantity and quality of its workforce". Because of
this, the ADB wrote in a recent report that the Laos government lacks the
capacity to carry out reform policies and recommended that revenues from mining
and hydropower projects be invested in education and training to make up for
"shortages of skilled labor".
The Lao diaspora's contribution to closing that skills gap is still minimal,
with the return of migrant Lao workers and former refugees from Thailand having
a bigger impact in bridging the divide, according to the ADB's Hnanguie. The
skills gap is a legacy of the communist takeover and the Stalinist regime's
subsequent mismanagement.
Those who fled Laos in the 1970s and 1980s were often members of the ruling
class, or the country's most highly educated. Today, only 3% of GDP is invested
in education and "only one-third of students that enter first grade are
estimated to complete all five grades of primary schooling", the World Bank
said in a 2008 report.
Although labor is cheaper in Laos than in surrounding countries, it fails to
capitalize on this comparative advantage because of a lack of skilled
entrepreneurs to provide employment for these workers, said World Bank
economist Vostroknutova.
That means non-Lao are mostly left to fill the entrepreneurial gap.
International firms usually send in their own managers and executives to
operate their branches in Laos. More visibly Westerners have opened restaurants
and art shops around Luang Prabang, to capitalize on the growing throngs of
tourists to the United Nations-designated World Heritage Site.
While foreigners bring much-needed capital, some note that they're also
changing the face of Laos. "Luang Prabang is not a melting pot. We have our own
style. We have our own identity," said Prince Somsanith, who says he would
prefer to see Lao nationals return to apply their overseas business savvy to
the local context.
Somsanith returned to live in Luang Prabang in 2005. He now lectures at a local
university and is the cultural adviser for the soon-to-open Amantaka boutique
hotel, a member of the Aman franchise. He said he sees himself as a cultural
ambassador for Luang Prabang, fighting the negative impacts of mass tourism by
encouraging young Lao to preserve traditional culture.
The Laos government says it is also looking at this new generation to fill the
nation's entrepreneurial and managerial gap. Every year the government provides
scholarships to 200 university students to study abroad, with the stipulation
that they maintain their Lao citizenship and return after completing their
studies.
"The government is benefiting hugely from this program because the government's
capacity to implement policy is low," said Vostroknutova. "It's not just
speaking English, it's also the ability to manage a firm." Yet many former Lao
refugees, after decades away from their homeland, face cultural and linguistic
hurdles upon their return.
"Many times I speak Lao better than they do," said Sebastian Rubis, the head
chef of an upscale restaurant in Luang Prabang, who notes both an increase in
returnees and their failure to assimilate. "It's a typical immigrant story. You
come back and people don't recognize you as part of the community any more,"
said Peter Kwong, the professor at Hunter College.
Returnees also expect their income to match their educational level, but
they're finding that they receive Lao-level - and not Western - wages on their
return. This eventually drove Mana, the founder of Update magazine, back to the
US for a higher-paying job. "Because I have a Lao name, people wanted to hire
me at a Lao rate. To me, it wasn't enough," he said by telephone from Honolulu,
Hawaii, where he works as an economics and business director.
Another hurdle for returnees is the Lao government's ban on dual citizenship.
By contrast, exiled Cambodians and their foreign-born children are
constitutionally recognized citizens, helping many of them to maintain ties to
their motherland and encourage their return.
Former senator and now spokesman for Cambodia's Council of Ministers, Phay
Siphan, retains his US citizenship and the fact that his father was in charge
of the bodyguard unit for former prime minister Lon Nol - who overthrew the
current king's father - is surprisingly unproblematic. "It's a melting pot of
royalists, republicans and communists," he said of Cambodia.
The political atmosphere in Laos, however, is less forgiving of the past. The
government remains wary of foreigners and communism is still used as a tool to
discipline civil servants and keep state officials and other potentially unruly
elements in check, according to regional security analyst Bertil Lintner. (See
Laggard Laos turns the economic corner Asia Times Online, January 10,
2008.)
Prince Somsanith claims to be the first member of Lao royalty to return to work
in the country, but he constantly noted that his "mission here is not for
politics; it's for art". Other returnees are similarly wary of their personal
histories and perceived associations. "I am a cook. I am not political,"
Sommay, the restaurant owner, repeatedly said during the interview.
While Sommay and Somsanith both said they're eager to invest and contribute to
Laos' emerging economy, both added that they have no intent to sacrifice their
key to the West - a passport - in favor of nostalgia. "My identity is in my
heart," said Somsanith, "not on the paper".
Stephen Kurczy is an Asia Times Online contributor based in Cambodia. He
may be reached at kurczy@gmail.com.
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