Vietnam “feels threatened” by increasing Chinese and Thai investment in neighboring Laos and is concerned that the two countries will dethrone it as the top investor there, according to a senior Lao official.
The concern was expressed in a letter from the secretariat of Vietnam’s ruling Communist Party to its Lao counterpart, the official told RFA’s Lao Service, speaking on condition of anonymity.
The letter reaffirmed Vietnam’s aim to be the leading foreign investor in Laos for years to come, said the official, who is a member of the Lao People’s Revolutionary Party’s Central Committee.
He said Vietnam felt threatened that the investments from the two other leading investors will eclipse its own.
Vietnam emerged this year as Laos’s top foreign investor, pumping in a total of U.S. $5 billion in 449 projects in Laos.
Thailand and China are a close second and third, respectively, and all three compete for projects in Laos’s energy, mining, and agriculture sectors.
Thailand has some 760 projects amounting to more than U.S. $4.8 billion and China has more than 800 projects in Laos with a value of about U.S. $4 billion.
Vietnam has planned to increase its investment in Laos to U.S. $7 billion by 2015.
Laos and Vietnam, which have had a special friendship and cooperation agreement since 1978, have in recent years offered each other investment incentives and tax breaks to boost investment and trade.
The two countries plan to increase bilateral trade from about $725 million at present to $2 billion in 2015 and to $5 billion in 2020, according to the Vientiane Times.
Southwestern Laos's Champassak province, known as a tourism, social, and economic hub, has attracted the most investors.
Other leading investors in Laos over the past two decades include South Korea, France, Malaysia, Japan, India, Singapore, and the United States.
Reported by RFA’s Lao Service. Translated by Viengsay Luangkhot. Written in English by Rachel Vandenbrink.