NEWS BULLETIN

2222 S. Street, N. W.
Washington, D. C. 20008
Tel: (202) 332-6416
Fax: (202) 332-4923

March-April 1997

LAO-INDONESIAN TIES FURTHER STRENGTHEN

The State visit to the Lao PDR of President Soeharto of Indonesia further strengthens Lao-Indonesian ties. President Soeharto arrived in Vientiane on February 19 at the invitation of President Nouhak Phoumsavanh and Prime Minister Khamtay Siphandone. The president was given an official welcome at Hor Kham Palace where, after the playing of the national anthems of the two countries, he reviewed an honor guard of the Lao People's Army, accompanied by President Nouhak.

In the evening , at a state dinner held at the National Assembly Hall in honor of the Indonesian leader, President Nouhak told the top visitor that his "first State visit of significance in our country will initiate a new step in the development of the cooperation between our two countries". The President thanked Indonesia for helping Laos in its preparation to join ASEAN which will not only meet the interests and aspirations of the Lao and Indonesian peoples but will contribute to the strengthening of peace, friendship, cooperation and development in the South East Asian region as well.

In a reply speech, President Soeharto said the main purpose of his visit to Laos was to reinforce the friendly relations, deepen the mutual understanding and promote the cooperation between the two nations. He also said that Indonesia fully supports the intention of the Lao PDR to become a full-fledged member of ASEAN. He believes the entry of Laos into ASEAN will reinforce the cooperation between Southeast Asian countries aimed at achieving national prosperity and creating regional stability, security, peace and well-being. In conclusion, the visiting president said Indonesia had followed the successful socio-economic development of Laos during the last 10 years, since the introduction of the market economy policy.

Three important documents were signed by Foreign Ministers of Laos, Mr. Somsavat Lengsavad, and Indonesia, Mr. Ali Alatas, during the state visit of the Indonesian President to Laos. One is an agreement on air communication and the others are the Memorandum of Under-standing (MOU) on agriculture and on forestry cooperation between the two countries. In the past, Indonesia and Lao PDR have signed a number of agreements, among others, the Agreement on Economic and Technical Cooperation, the Agreement on Investment Guaranty and Promotion and the Memorandum of Understanding on Cooperation in Tourism.

The two sides noted that there were still many things to do together especially in the economic and commercial fields. Discussions also ran on identifying the commodities that could be purchased and traded together. For example, Indonesia needs to purchase some basic commodities such as soybean and sugar, and it would be good if Laos could supply these commodities. Indonesia also had some products sold to Laos, but through third countries, therefore, both sides should have direct trade and look for new ways to ship them directly in order to reduce delays and prices. The possibility for the establishment of joint ventures and investment cooperation were also discussed. Laos and Indonesia also looked for establishing joint venture in cement production. Another field that Laos and Indonesia can be doing well is the technical cooperation.

During their stay in the Lao PDR, President Soeharto and his delegation visited the That Luang Stupa which is the symbol of the Lao nation, the Revolutionary Museum, and traveled to the Mittaphab bridge on the Mekong River, some 20 km from Vientiane. Before the visit concluded, President Soeharto was offered a Baci by the Lao President and Mrs. Nouhak Phoumsavanh. The Baci is a ceremony of wishes for good health, happiness and longevity organized for intimate friends.

THE SIXTH ROUND TABLE MEETING FOR LAO PDR

On March 19, the Department of International Economic Cooperation (DIEC) held a one- day roundtable meeting. Speaking on behalf of the Lao government, Prof. Bountiem Phissamay, Deputy Minister of the Committee for Investment and Foreign Economic Cooperation (CIFEC), Prime Minister's Office, said the purpose of the meeting was to inform socio-economic development partners on the progress of preparations for the forthcoming Sixth Round Table Meeting (RMT) in Geneva, scheduled for June 19-20. He solicited frank comments and recommendations on the draft document, entitled "Socio-Economic Document and Investment Requirements for 1997-2000" which will be presented by the government at the sixth RTM. The document presents the long-term goals and short-term objectives, targets, strategies, policies, priority programs, public investment figures and external assistance requirements. He said the following documents were used as the basis for writing the RTM document: the 1996-2000 socio-economic development plan, public investment program, national rural development program, and human resource development program.

Deputy Minister Bountiem added that, in accordance with the resolution of the Sixth Party Congress, the government's long-term goal is to "free Laos from the state of underdevelopment". As reflected in the RTM document, the government is now translating this goal into more operational terms, to graduate from the ranks of the least developed countries (LDCs). He said: "To achieve this goal, we need to sustain, if not improve the economic growth which we have achieved during the past five years so that we can meet the target per capita GDP of US $500 by 2000. The threshold for graduation from LDC status is currently US $865." The country's per capita GDP had increased 75 per cent from US $200 to US $350 in 1995. With the continued support of the donor community, the long-term goal can be attainable. Prof. Bountiem acknowledged the contribution of the United Nations Development Program (UNDP) to the RTM process, including the preparations for this and previous RTMs.

An overview of the Round Table Meeting document was presented. Then the participants were briefed about the plans for development and investment, including the plan for socio-economic development, public investment plan, rural development plan, human resource development plan, and draft document to be presented to the sixth meeting of donor countries for the Lao PDR.

Among the participants were UNDP Resident Representative in Laos, the Ambassador of Australia, France, Japan, and representatives of a number of embassies, the World Bank, the International Monetary Fund, the Asian Development Bank, representatives of donor countries, international organizations and NGOs. Also attending the meeting were representatives of the Ministry of Foreign Affairs; the State Planning Committee; the Ministries of Communication, Transport, Post and Construction; Industry and Handicraft; Education; Public Health; the Bank of the Lao PDR; the Lao Women's Union.

TARGET TO REDUCE DEFECIT TRADE

Laos has set out to gradually reduce its foreign trade deficit which has reached 40.7 per cent of the value of its imports. According to a report of the Ministry of Commerce, this is a long-term target to be achieved by focusing on import management, and promotion of domestic production as an alternative to imports and for export.

During the 1996-2000 period, the ministry will create favorable conditions in Laos so that hopefully it will reach the crossroads, taking advantage of trends in business, services and trade in the region, while striving to raise the gross value of foreign trade by 12 per cent annually. At the same time, Laos will make efforts to acquire membership of the ASEAN Trade Area (AFTA). As for domestic trade, goods distribution and circulation between producers and markets and between producers and consumers will be facilitated. Attention will also be paid to the promotion of goods circulation in rural, mountainous, and outlying areas.

The report also reveals the government's desire to gain an annual mean rise of 13 per cent in the gross value of retail sales and circulation figures. It also indicates that to date the country has reached trade agreements with 12 countries, having trade parts with some 34 countries. Inter-national trade in 1995 totaled US $933.5 million, a two-fold increase compared to 1990.

EMERGENCY OPERATION FOR FLOOD VICTIMS

The devastating floods that struck central Laos in September last year destroyed crops on 70,000 hectares of the most productive land in the country. Fourteen of the districts in the seven most severely affected provinces -- Khammouane, Borikhamsay, Savannakhet, Saravane, Champassak, Attopeu and Sekong -- that suffered extensive flood damage were also severely flooded the previous year and a few had lost crops three years in succession.

Following the Government's appeal, a joint food assessment mission of the World Food Program (WFP) and Food Aid Agency (FAO) of the United Nations traveled in the affected areas and estimated that the amount of food aid required would be 43,000 tons. As a result of this appeal and the report of the mission, WFP has mounted an emergency operation (EMOP 5823: Food Assistance for Flood Victims) to raise 30,240 tons of rice for the most severely affected. The food will help the more than 420,000 flood victims -- all subsistence farmers growing a single crop per year -- survive in their villages and cultivate this year's rice crop during the six months leading up to the next harvest in November 1997.

It is hoped that the remainder of the rice required would be raised from bilateral donors, either giving directly to the government or to Laos with the assistance of WFP. The planning and execution of the EMOP is being done by WFP in collaboration with the Committee for Food Aid Reception and the Ministry of Labour and Social Welfare with the combined goals of equability and optimum use of donor-provided resources. In recent years, appeals for aid for victims of natural calamities in Laos has met with a warm-hearted response from many nations.

Although the EMOP was only announced on March 12, a number of donors have entered into discussions with WFP as to how they might help. Australia has already announced an aid of A $650,000 for rice to be supplied by WFP and distributed by four NGOs with Australian links. This year's World Food Program rice will be distributed through NGOs in districts affected. The organizations cooperating with WFP in the current EMOP are, so far, CARE International in Khammouane and Savannakhet, ADRA and World Vision in Champassak, Save the Children Australia in Borikhamsay, and Community Aid Abroad in Saravane. Where feasible, the rice will be used to create rice banks and initiate and support food-for-work activities aimed at providing increased food security in the future through disaster preparedness, prevention and mitigation.

LAO ENVOY PRESENTS CREDENTIALS TO MEXICAN PRESIDENT

In addition to his current assignment as Ambassador Extraordinary and Plenipotentiary of the Lao People's Democratic Republic to the United States and Canada, His Excellency Hiem Phommachanh, on March 19,1997, presented his credentials as the first Lao Ambassador to Mexico to President Ernesto Zedillo-Ponce de Leon of Mexico at the Presidential Palace.

On this solemn occasion, the new Ambassador conveyed the warm regards and best wishes of President Nouhak Phoumsavanh to President Ernesto Zedillo-Ponce de Leon. He recalled that geographically Lao PDR and Mexico are two countries far away from one another, but they are close in spirit as both countries are active in the Non-Aligned Movement. He also expressed the gratitude of the Lao government and people to the government and people of Mexico for providing their consistent support to the just cause of the multi-ethnic Lao people in the past as well as at the present time. In concluding his remarks, Ambassador Hiem Phommachanh reaffirmed his commitment to put all his efforts into this honorable mission in order to develop and further strengthen the increasing relationship and cooperation between the Lao PDR and Mexico.

LAO PDR HELPS UN SOLVE LONG AND THORNY ISSUE

The Special Political and Decolonisation Committee (Fourth Committee), adopted the omnibus resolution on the remaining Non-Self-Governing Territories in the Pacific and the Caribbean, at the resumed session opened on March 14, by its Chairman, Ambassador Alounkeo Kittikhoun, Permanent Representative of the Lao PDR to the United Nations, according to a report from the Lao Permanent Mission to the UN.

At the proposal of its Chairman, the Committee considered and unanimously adopted the omnibus resolution "without vote", said the report. The report also said this was the result of the two month-long informal consultations between the Administering Powers (United States-United Kingdom) and the Special Committee on Decolonisation (C24). The informal consultations were held under the coordination of Ambassador Aloukeo Kittikhoun.

Before the Fourth Committee adopted the omnibus resolution, its chairman praised the parties concerned for showing their flexibility during the informal consultations, which greatly contributed to reaching consensus. The chairman of the Fourth Committee also expressed the hope that they will continue to cooperate with each other in their future relationship, while fully taking into account the legitimate interests of the peoples of the Non-Self-Governing Territories. This was to allow the UN to fulfill its objectives in eradicating colonialism by the year 2000.

For their parts, the delegations of the United States and the United Kingdom, Ambassador of Papua New Guinea, who is Chairman of the C-24, the delegate of the Netherlands, who represented the European Union, and others expressed their gratitude and appreciation to Ambassador Alounkeo for his crucial role in helping the concerned parties to reach agreement on this sensitive and delicate issue that has been left unsolved for the last six years. The UN diplomatic circle considered this success as a great achievement made under the Lao PDR Chairmanship of the Special Political and Decolonasation Committee during this 51st session of the UN General Assembly. The achievement also indicated that the Lao PDR has played an important and active role in the UN arena.

LEGAL SEMINAR ON DRUG CONTROL

According to amendments to Article 135 of the Criminal Law promulgated by the Lao president in early 1996, drug offenders in Laos could now face life imprisonment and fines of up to 100 million kip, rather than only 10 years in jail as in the past. This legal article was one of the drug control and supervision measures discussed at a seminar for prosecutors, police and customs officers held in Vientiane, in late February.

Chaired by Deputy Foreign Minister Soubanh Sritthirath, Chairman of the Lao National Commission for Drug Control and Supervision (LCDC), the seminar was attended by diplomatic corps members and representatives of the regional division of the Memorandum of Understanding (MOU) on drug control cooperation in Southeast Asia. Mr. Soubanh Sritthirath pointed out features of drug consumption and its negative impacts, including various social problems. These problems include murder, robbery, road accidents and other social evils.

Due to the prevalence of opium production, drug trafficking with foreign countries, and the importation and consumption of drugs in some towns and localities, the Lao government has made drug control and supervision a priority. The Lao government has pooled all its efforts into addressing these issues, by focusing on socio-economic development in the provinces where opium is grown. This is aimed at gradually reducing the sources of drugs. In addition, there are also measures for prevention, education, treatment and rehabilitation, and provision of employment for drug addicts. Concerning suppression, the Lao National Commission for Drug Control and Suppression has set up its offices in Vientiane Prefecture, Savannakhet and Bokeo provinces.

The Lao government has enjoyed strong cooperation from the member countries of the MOU, the United States and other friendly countries. During the two-day seminar, participants also shared their experiences in drug control and its effects, and the related social problems, as well as proposals for efficient drug prevention and control.

THE NUMBER OF FOREIGN INVESTORS INCREASES

From 1988 until the end of 1996, investors from 30 countries around the world registered 616 investment projects worth about US $6.7 billion in Laos. The projects included agriculture (61 projects totaling US $55 million), garments (73 projects totaling US $70 million), industrial handicraft (110 projects totaling US $470 million), wood processing (34 projects worth US $83 million), mineral excavation (28 projects totaling US $115 million), commercial (98 projects totaling US $61 million), tourism and hotels (32 projects totaling US $604 million), banks and insurance (11 projects totaling US $73 million), general consultation (24 projects worth US $28 million), construction (34 projects totaling US $ 57 million), telecommunications (12 projects worth US $561 million), and 7 hydropower projects worth US $4.5 billion.

Foreign demand to invest in Laos is high. In 1996 there were about 450 companies from 20 countries which contacted the Lao government to investigate investment opportunities. Most of the investors were from the European Community, Japan, Korea, Australia, USA, China and some countries from the Association of South-East Asian Nations. Last year, the government has approved 108 projects out of 198 applications.

TOURISM: THE FOURTH LARGEST SOURCE OF NATIONAL INCOME

The National Tourism Authority (NTA) of the Lao PDR expects over 500,000 tourists in 1997, bringing revenue of US $37.2 million. Last year, Laos welcomed over 400,000 tourists, generating an income of US $31 million for the country. This growth has been accompanied by a rising number of hotels and guest houses. In addition, last year the investment in six tourism facilities projects was more than US $217.5 million. At present, the National Tourism Authority of Laos has contracts with 462 partner companies, while in 1994 there were only 289 such deals. According to the authority, hotels and guest houses must increase their number of rooms to 4,540 to support the influx.

The NTA also plan to promote domestic tourism and is developing a master plan and promotion package for Luang Prabang, in northern Laos. The programs for tourism development in the country also include the survey of the Houai Nyang Natural Conservation Forest in Vientiane municipality; the survey for a tourist village along the Mekong River, at Park Baeng in northern Oudomsay province; and the study for an ethnic cultural village at Done Sao, northern Bokeo province. Other projects include the survey of roads and tourist sites in the northern provinces of Houaphan and Sayaboury and the southern provinces of Saravane, Sekong and Attopeu; preparations for the "Visit Laos Year" in 1999; the construction of guest houses in Luang Prabang province; and hotel and tourism training.

US-ASEAN COUNCIL AND LNCCI TO COOPERATE

The US-ASEAN Council for Business and Technology and the Lao National Chamber of Commerce and Industry (LNCCI) signed on March 15, a memorandum of understanding concerning mutual cooperation. This agreement is designed to promote economic and trade relations between the Lao PDR and the United States, and to enhance the trading and economic interests of firms and companies in both countries. The agreement states that the two parties will exchange business missions, economic and commercial information, and educational programs. Additionally, both sides will assist each other with trade fairs, exhibitions, seminars and conferences, and in other ways that promote direct and effective business relations. The two sides will meet every two years to decide on detailed plans for cooperation.

In signing the agreement, Mr. Ernest Z. Bower, President of the US-ASEAN Council for Business and Technology said that " it is an open-ended agreement, being initiated this year. There is no time limit. The reason it is being signed now is that America's investor interest in Laos has increased significantly, in anticipation of Laos joining ASEAN. We hope this agreement will create jobs and business ventures for Lao people, as well as Americans. We hope it will be mutually beneficial for both people."

On the same day, the US-ASEAN group called on Minister of Finance, Mr. Saysomphone Phomvihane who presented to the visiting delegation details of the government's policy and the economic and investment situation in Laos, including a brief on socio-economic development. With regard to Lao-US relations, Minister Saysomphone said that Laos and the United States are gradually improving their cooperation at different levels. The signing of OPIC agreement last year was an important step in cooperation. Mr. Saysomphone added that "Laos will become a member of ASEAN this year, and this is both a chance and a challenge for the country, as Laos is such an undeveloped country. He then urged the US-ASEAN Council to support and motivate US investment in Laos. He also asked the Council to support Laos in its bid for Most-Favored Nation (MFN) status and General System of Preference (GSP).

LAO-U.S. RELATIONS UPDATE

During his visit to THE VIENTIANE TIMES newspaper office in Vientiane last February, H.E. Hiem Phommachanh has been asked to brief Lao-U S relations. Following is the resume of his interview.

The Ambassador first recalled the development of Lao-U S relations over the past years by noting that, of the three countries of Indochina, Laos was the only one which never severed diplomatic relations with the United States during and after the war. The relations were kept at Chargé d'Affaires level and were upgraded to ambassadorial level in 1992.

The US is interested in two major areas: the recovery of American soldiers missing in action during the Indochina war (MIA) and the fight against drug production, trafficking and consumption, all of which it considers as humanitarian issues. "we worry about our people's living conditions and we understand the worries of the American people for their loved ones. It is for these reasons that we accepted to cooperate with the U S in both issues," said Mr. Hiem. The cooperation had developed gradually.

Laos was on the list of countries not entitled to U S direct assistance. In 1996, it was removed from the list. In May 1996, the two countries signed an agreement on Overseas Private Investment Cooperation (OPIC) to protect US business companies operating in Laos.

Now, both sides are focusing on the signing of the Bilateral Trade Agreement, which is a major step toward the Most Favored Nation status (MFN), which would give a boost to the Lao economy as it would open wide markets for its products. So far a series of negotiations is in process. We hope that once the Trade Agreement signed, the US Congress would not raise obstacles for granting MFN to Laos. For the time being, garment is the only export item to the US for a small quota of 125,000 dozens yearly with an annual increase of 7 percent. Without MFN, taxes are high-- over 40 percent.

Even though the EXIM Bank, the US bank for import-export still gives no loans to American companies for investments in Laos, among over 30 countries investing in Laos. the US is ranked second with such big companies as Hunt Oil and Pacific Rim involved. However, US companies can invest in Laos, but cannot sell their products in the United States. "With MFN, we will have markets, thus more investments. And this will encourage the private sector to develop". Also, among the 300,000 native Lao living in the US many would have the opportunity to invest in their homeland, if MFN were granted.

It is confident that Lao-US relations will expand in the future and cooperation between the two countries will increase. To date, the US has representatives in Vientiane for MIA affairs and Laos has accepted that the Drug Enforcement Administration (DEA) send a representative in Vientiane too. And Laos has given full cooperation to the United States on both issues. On the other hand, Laos will join ASEAN group this year and the United States is a partner of ASEAN, so cooperation between the two countries will increase.

ADB WILL GRANT US $270 MILLION LOAN TO LAOS

The Asian Development Bank (ADB) will provide Laos with loans of US $90 million in each of the next three years. Mr. Rajat Nag, program manager of the ADB's Programs Department said " we sent Mr. Rajendran and some other programmers to Laos to program assistance for Laos for the next three years, and we can now say that we will grant about US $90 million to Laos each year for the years 1998, 1999 and 2000."

On top of the US $90 million concessional loan, the ADB will also provide about US $5 million in the form of a technical assistance grant. The confessional loan, (also called soft loan because 80 per cent of the loans are grants with zero per cent interest and it is a long-term loan of about 30-40 years), will be used for various projects while technical assistance will be used for fields study. The loan from the ADB carries zero per cent interest, however Laos is required to pay a service charge of between 0.75-1 per cent of the principal. The service charge takes effect after the loan is first released. Most of the funds granted by the ADB are allocated towards infrastructure construction, in hydropower works, roads and rural development projects. It has been almost 30 years since Laos first began to build its solid relationship with the ADB and up to now the ADB has granted about US $700 million to Laos for its development needs.

In another development, on March 3-8, a delegation of the Board of Directors of the Asian Development Bank (ADB) visited Vientiane to discuss and review a report on outcomes of the assistance provided by the ADB to Laos, as well as the Lao government's socio-economic development policy. The assistance provided by the ADB amounts to over US $360 million, of which US $115 million has been in the form of low interest loans, and grants.

Finance Minister Saysomphone Phomvihane told the visiting delegation that some of the socio-economic developments using ADB loans had already been completed. Last year, Laos was able to complete projects which used ADB loans, out of the total 38 ongoing loan projects. Three loans were for communications, eight for electric power, one for water supply, five for agriculture and three for macro financial budget balancing. The total cost of the projects was US $190 million. The 18 remaining projects include six for communications, four for electric power, three for water supply, one for agriculture, one for macro financial budget balancing, two for education and one for public health. Finance Minister also pointed to a policy the government is working on for opening up wider cooperation with foreign countries. This will include economic management according to the market mechanism, improving the Lao economic structure, and prioritizing development which is coupled with environmental protection.

WORLD BANK LOAN FOR ROAD MAINTENANCE

The Lao government and a World Bank delegation signed a US $48 million loan negotiation agreement related to the construction of Road 13 South, between Savannakhet and Pakse towns, and Road A1. The Savannakhet-Pakse stretch is 200 km long, while Road A1 covers seven kilometers. The money is also to be used for repairing 600km of the 6,324km of national road network. The expected total cost for the work is US $68.92 million, of which the government's contribution of the Nordic Development Fund is US $5.75 million. The project will begin operating in October 1997 and end in December 2002.

JAPANESE AID ASSESSED: US $50 MILLION PER YEAR

On March 13, the Embassy of Japan organized a seminar at Lane Xang Hotel, called "Official Development Assistance (ODA) Evaluation Seminar: Future Challenges for Lao Development and Japan's Cooperation".

Speaking at the seminar, the Director of the Department of International Economic Cooperation (DIEC) indicated that Laos has received significant Japanese grant aid in various domains, totaling US $50 million per year, thus making Japan the biggest donor to date. In addition to the annual grant of US $50 million, over the last few years the government of Japan had given additional aid for programs outside the regular cooperation projects, worth 500 million yen annually. This special aid has tripled this year.

Also speaking at the inaugural session, Japanese Ambassador Hiroomi Sakai said that a country evaluation was conducted in Laos last November, to verify the overall effectiveness and impact of the Japanese assistance. The objectives of this study were to come up with recommendations from the follow-up evaluation studies, and to apply the findings in future policies. Ambassador Sakai said the traditional relations between Japan and Laos are expected to be strengthened even further, and Japanese ODA to this country has also been strengthened.

"Stability and development in the Greater Mekong Sub-region is indispensable for peace, political and socio-economic stability in Asia and the Pacific. As the Lao PDR is geographically located at the centre of the sub-region, the country is expected to play an important role for the sub-regional development. Recognizing this important role to be played by Laos, the government of Japan has extended its support to efforts for Lao socio-economic development, including Japanese support through various international forums and organizations," Ambassador Sakai said.

Laos and Japan established diplomatic relations in 1951 and have enjoyed close relations ever since. An Economic and Technical Cooperation Agreement was concluded by the two countries in 1958. Since providing a grant for the Nam Ngum River Development Fund in 1966, Japan has extended its grant annually. Under the technical cooperation program, Japanese experts from various sectors have been dispatched. The first group of Japanese Overseas Cooperation Volunteers (JOCV) to developing countries was sent in 1965. Laos was one of the four countries which received the first batch. The Japanese experts and volunteers work in infrastructure building, agro-forestry, health, education, environment, social welfare, humanitarian aid, and engineering sectors. In addition, under the JICA technical cooperation program, many Lao government officials and trainees have also visited Japan and many Japanese experts and JOCV visited Laos.

AUSTRALIAN AID TO LAND TITLING PROJECT

A memorandum for Australian grant aid to a Lao land titling project was signed between the Ministry of Finance and AusAid. The memorandum specifies that Australia will share the cost of the land titling, which starts in March this year. The project is expected to last seven years. The project will also use a US $20.7 million loan from the World Bank, in addition to the government's input of US $2.6 million and the Australian grant of US $5.1 million.

The Australian grant will be used for technical support, principally focusing on land titling surveys in five provinces, which will form the basis for forming policies and regulations on land management. The outcome of the surveys will also be used for developing a properties evaluation system, improving the organization and implementation of land use, and for researching the rights to land and the registration of land parcels.

In addition, the outcome of the surveys will be used for identifying and determining forest land and the impact derived from land titling. The provinces to be surveyed include Vientiane prefecture, and the provinces of Vientiane, Luang Prabang, Savannakhet and Champassak.

Since August 1995, the government of Australia has provided a US $1.3 million grant for pilot land titling projects in some Vientiane prefecture areas in preparation for a nation-wide program. This pilot program has greatly facilitated the project, since it has formed a contingent of personnel in the area of land titling.

LAO-CANADIAN COOPERATION

A four-year cooperation project between the National University's Faculty of Architecture and Engineering (FAE) and the François Xavier College of Garneau, Quebec, Canada, was completed, concluding an intensive effort to upgrade the abilities of the faculty's teachers.

The project, "The Upgrading Teacher and Management School Project," was started in 1993. This project was supported by the François Xavier College to the tune of C $340,000. About 80 people went through the project, including the teachers of the FAE and from the provinces and other sections in Vientiane. The subjects covered in the courses included geometric design, the basics of teaching, basics of design, urban planning, methods of design, restoration of old buildings, using computers for tabulating, using computers for design, and control and management of schools. The four-year project provided three different upgrading courses in Canada, for nine Lao teachers of the FAE, one month long. It also provided 10 courses in Laos at the FAE which were run by the experts from the Chicoutimi College, Canada. The François Xavier College also provided the project with equipment such as a photocopier, computers, textbooks and documents. Early in 1996, six students from the François Xavier College came to Laos for three months to do research and study with the students and the teachers of FAE on the topic "Lao Origins and Social Customs." This topic was studied in Luang Prabang and, as a result, the FAE gained a lot of information about Lao origins and social customs it will now use to teach students at the FAE.

LAO STAR TO BUILD GROUND STATION

Lao Star, the company which is going to launch and operate the first communication satellite in the Lao PDR, signed a contract with Lao Thiess Constructors Co. Ltd. on the building of infrastructures for its ground station outside Vientiane. Lao Thiess Constructors Co. Ltd. a member of the Leighton Group, one of the world's leading construction companies, won the bid and will immediately start the US $4.8 million worth construction work. The ground station is located in Hadsaifong district, on KM-15 on Thadeua Road. The work involves the construction of three buildings: the main building which will house the administrative and technical centers, a dormitory and a recreation centre. The construction work should be completed in a few months time so that the equipment could be installed by October and tests should start immediately after.

Professor Bountiem Phissamay, Lao Star President, said: "The ground station should be fully operational in December as the launching of the first satellite is scheduled for December2, Lao PDR's National Day. If meteorological conditions allow, of course." The launching will be made by the European consortium, Arianespace from French Guyana, with an Ariane V launcher.

Telesat Canada will install the equipment worth over US $25 million. There will be a back-up station in Perth, Australia, and Telesat will carry back-up work in Canada as well. Lao Star has already paid 70 per cent of the US $100 million cost for the manufacture of the first satellite, L-Star 1. The second satellite, L-Star 2, will be launched by Lao Star six months after the first one, approximately in June or July 1998. The 32 transponders of the L-Star 1 are booked. Each transponder can carry several television and radio channels. Booking is well advanced already for L-Star 2.

The Lao government entered into joint venture with ABCN (Asia Broadcasting and Communications Network) and the two sides signed an agreement on November 1, 1995 establishing Lao Star Co. Ltd. in which the government holds 20 per cent of the shares and ABCN 80 per cent. The total cost of the program is US $500 million, including US $200 million for the two satellites, US $200 million for the launches, and US $100 million for ground station building and equipment.

RAILWAYS TO RUN THROUGH THE COUNTRY

A joint venture agreement on railway transportation was signed in mid-February to create a railway network for Laos. According to the agreement, the Lao government and the Pacific Transportation Co. are to establish and register the Lao Railways Transportation Company.

The company will initially build a railway line along the middle of the Friendship Bridge, spanning the Mekong to Vientiane. The first phase, starting from the day the agreement is signed, is expected to take two years to complete. During this phase, a feasibility study will be carried out on the construction of railways between Vientiane and Luang Prabang, phase 2, and the stretch from Luang Prabang to Boten (Sayaboury province), phase 3. The work will take four years to complete, from the time the government adopts the workplan. In addition to the construction of the railways, the agreement also talks about other projects, including developing industrial zones, human resources development, and additional transportation development projects.

The construction of the railway from Thailand's border town of Nongkhai to Vientiane is estimated to cost US $40 million, of which 25 per cent is being provided as equity by the Lao government. The terms of the concession, starting from the completion of the project, can be renewed for another 30 years. If the company makes profits of more than 20 per cent on the investment, the parties will reconsider the percentage of the shares as deemed appropriate.

MEETING FOR DONORS IN COMMUNICATION FIELDS

A conference of donors in the sector of communications was held in February under the chairmanship of the Minister of Communications, Transport, Post and Construction (CTPC).

During the meeting, several development plans were presented for 1997-2000, along with other communication issues which need to be addressed immediately. These included the creation of a national road network, plans for communication repair, for upgrading the organization of those involved in communication work, including cadres, and the development and extension of the communication network in the Lao PDR. Attendants at the meeting also discussed the government's policy and the need for funding to fulfill this policy and the plans of action.

Present at the conference were representatives of the World Bank, the Asian Development Bank, the Swedish International Development Agency, Australian Aid, the Japanese International Cooperation Agency, SweRoad, the embassies of the Federal Republic of Germany, Sweden and the Republic of Korea, the John Holland company and the Joint Development Fund of Norway. Representatives of the Finance Ministry and the Committee for Investment and Foreign Economic Cooperation, experts and technicians from the CTPC ministry, as well as Vientiane Municipality and Champassak province also participated in the meeting.

ROAD 13: HIGHWAY TO DEVELOPMENT

The upgrade of another section of Road No13 was completed with Swedish assistance and handed over to the Lao government, bringing the government closer to its dream of linking the whole country. The area of road just completed, stretching 177 km from DonNoun village (12 km south of Vientiane) to Pakkading district in Borikhamxay province, represents the middle section of Road No 13, the only link between the north and south of Laos. The road has a double bitumen surface dressing, 9m wide with a 7m carriageway and one meter shoulders, and the road work also includes the construction of 14 bridges. The old Bailey and Pigaud bridges were replaced by concrete bridges constructed to international standards. Some bridges located in villages or cities were widened to a width of up to 9 m or had footwalks built. Road markings such as traffic signs, edge marker posts, kilometer posts and information signs were provided.

The Vientiane-Pakkading upgrade project has been implemented since 1987, under the Lao-Swedish Cooperation Project. The project is valued at SEK 364.94 million, (US $50.68 million), and has been co-financed by SIDA (US $41.25 million), by the Nordic Development Fund (US $7.2 million) and the Lao government (1,600 million kip). Speaking at the hand-over ceremony, the Minister of Communication, Transport, Post and construction praised Sweden for the support and assistance provided to the Lao PDR in its drive for socio-economic development. This assistance will help the Lao government implement its socio-economic plan from now till the year 2000, thereby facilitating the poverty alleviation of the Lao people.

Road No13 is the main national road of Laos and the only link between the capital and various provinces across the country. Another stretch of Road 13 South is also to be upgraded as a US $4 million loan agreement has been signed between the Ministry of Finance and the Nordic Development Fund for a road renovation project in the country. The money will be used to upgrade the 170 km long stretch of Road 13 South, from Savannakhet to Champassak province. The government also borrows US $48 million from the World Bank to put in as its outlay in this project - a cooperative venture among the Nordic Development Fund, the World Bank and the government of Lao PDR. Other sections of Road No13 are now being worked on by various foreign companies.

INTEGRATED DEVELOPMENT OF VIENTIANE CAPITAL CITY

Issues related to integrated development of Vientiane city were discussed at a conference held in March 14 by vice-mayor of Vientiane and the steering committee for the Asian Development Bank's (ADB) loans. Also taking part in the discussion were deputy minister of Communication, Transport, Post and Construction and the governors of Vientiane municipality's four districts within whose jurisdiction the project is being carried out.

The conference listened to a proposal for an inner city road, known as T2. This road will stretch from Ban Akad (Wattay) to Ban Nongdouang, passing through Ban Sihom and Thongkhankham to Ban Sibounheuang, and through That Luang to Nasay, and finally reaching Cosco junction (Saphanthong-Dong Palane). This proposal will be submitted for government consideration, pending on the Ministry of Communication, Transport, Post and Construction permission to carry out a feasibility study. The conference also listened to reports on efforts to improve the town's environment, particularly its waste water drainage system, the principal drainage canal from Passak to That Luang marsh. Also on the agenda was the question of improving sanitation, such as the provision of credits to families in project villages, for construction water-seal toilet facilities for their private use. The activities are expected to proceed at the end of this year, following the bidding and selection of the constructor (s).

The project for integrated development of Vientiane is one of the projects which has received ADB funding, totaling US $20 million, on top of the government's input of $5 million. The project is expected to be completed by the year 2000.

RENOVATION OF KHOUVIENG ROAD

Almost a third of the renovation work on Khouvieng Road, an 8.5 km stretch of road being upgraded and widened for US $11 million, has now been completed. The work started in October last year and is expected to be finished by October this year.

Khouvieng Road, one of the six roads to be renovated in Vientiane Municipality, was the inner wall of Vientiane city at one time. As a road, however, it has proved too narrow to accommodate traffic going both ways. When the renovation of this road is completed, it will be eight meters wide.

EDL SURPASSES PROJECTED REVENUE BY 7.3 PER CENT

Last year, Electricite du Laos (EDL) produced 1,247 kWh of electricity, surpassing its projected plan by 10.54 per cent, and its 1995 figure by more than 15 per cent. Speaking at a conference to review the past year's activities of this state-owned enterprise, EDL General Manager said 792 kWh of energy was exported, earning some US $29 million for Laos, surpassing the plan by 7.3 per cent. 379 kWh was consumed domestically, bringing the government 10,208 million kip of revenue. In all the enterprise earned revenue of 42,719 million kip or 35.85 per cent more than anticipated in the plan and 36.86 per cent more than it made in 1995.

The report also indicated that , in 1996, some 87 million kWh was imported, 3.23 per cent more than the plan. The enterprise made a 6,754 million kip to the state budget and spent 20,651 million kip on debt repayment with interest, amortization, and maintenance. In 1997, Electricite du Laos plans to produce more than 1,090 million kWh.

NAM NGUM 3 PROJECT: PREPARING FOR THE SECOND PHASE

As the government prepares to open the second phase of Nam Ngum 3 project in July, the company in charge of the dam, MDX, organized a site inspection for journalists, potential bidders for the next stage of the dam, and relevant government officials. The Nam Ngum 3 dam is located near Ban Longcheng in Saysomboune Special Zone and is 130 km northeast of Vientiane. The inspection site visit included the dam site, power station, transmission line, power tunnel line and the core samples inspection. Representatives of seven companies preparing to bid, inspected the switchyard, the power station and all areas of Nam Ngum 3 by helicopters.

The memorandum of understanding between the Lao government and MDX of Thailand was signed in March 1994. Snowy Mountains Engineering Corporation of Australia (SMEC) was then selected from various international bidders to undertake the feasibility study. Work on the study commenced in November 1994 and took approximately 18 months. According to the agreement, MDX has a 55 per cent equity interest while the Lao government holds 45 per cent. The project, which is expected to be finished by the year 2002, costs about US $500 million.

The development is situated in the middle reach of Nam Ngum, at an elevation of about 520 m above sea level. A high-walled dam will be built across a deeply entrenched section of Nam Ngum about 4.5 km upstream of its confluence with the Nam Pha to create a reservoir which diverts the flow of the river, via a single pressure tunnel, to a power station situated 330 m below the full supply level of the reservoir on the lower Nam Ngum. The tunnel will be 10,600 m long and the power station will be established underground. The overflow spillway will be 35 m wide, with an estimated maximum discharge of 10,280 cubic meters per second. The power station will house four 110 MW turbo-generator units, control and auxiliary equipment in the machine hall, and four 3-phase transformers in the transformer hall. Associated structures include an access tunnel, and a cable ventilation tunnel. Nam Ngum 3 is a concrete faced rockfill, and the design is approximately 220 m high. The reservoir to be formed by the dam will have an active storage capacity of 979 million cubic meter. The areas that will be flooded cover 25.6 square km.

The contract for the first stage of the project, already bid for, involves the construction of access roads from Road 13B to Ban Longcheng and Longcheng to the dam site (about 65 kilometers), a tunnel for discharging water, and houses for the workers. The contract for the second stage, to be bided for in July, involved construction of the dam, power station, 11.5 km tunnel and a 180 km transmission line to the Thai border. Power from Nam Ngum 3 will be exported to Thailand and some will be used for electricity service within Laos. The Nam Ngum 3 hydroelectric dam will be the second largest power producer in the Lao PDR. It will have an installed capacity of 400 MW. The largest dam is the proposed Nam Theun 2 hydroelectric power project, which will have a capacity of more than 600 kW.

NAM LEUK HYDROPOWER PROJECT

The management of Electricite du Laos announced at a press conference in mid-March that the construction of Nam Leuk, a 60 MW hydropower station, was started last month and is expected to be completed by 1999. Some basic work such as access roads and the electricity lines to the dam site has already finished. The project was funded by the Asian Development Bank and the Overseas Economic Cooperation Fund of Japan. The two funding agencies have been instrumental in the financing of the design work, the construction of the structures and the manufacturing of the equipment. The construction cost of the power structure is US $112.6 million.

The Nam Leuk hydropower project, southeast of the Nam Ngum reservoir, is 80 kilo-meters north of Vientiane. The diversion dam will produce 210 MW per hour and will increase the electricity production in Nam Ngum dam by another 20 Gwh per hour since the water going through the two turbines of the Nam Leuk dam will be discharged in the Nam Ngum reservoir. The construction work will be carried out under the control of Sogreah, a French consulting engineer company for the design and the construction supervision of the project.

Two transmission lines carrying the energy either to Paksane, Borikhamsay province, or to the Nam Ngum station, will allow a reliable dispatch within the country, and to Thailand where the surplus will be sold. It is estimated, at this point, that some US $10 million will be made from electricity sales. Nam Leuk is one of the projects designed to alleviate poverty in Lao PDR. Communities in the vicinity will receive electricity from the project. The project will also provide financial aid to the Phou Khao Khuay National Biodiversity Conservation Area where the Nam Leuk reservoir is located and will bring in the long term all the benefit associated with cheap renewable hydroelectric energy to the country in the form of available power for industry development. It was also disclosed that part of the income will be used for conserving the environment.

NAM NGUM 2 HYDROPOWER PROJECT TO BE BUILT SOON

The Nam Ngum 2 Hydroelectricity Power Project, one of the country's largest hydro-power dams with generating capacity of 615 MW, has been announced to be constructed in the near future. The announcement was made by the authorized representative of the Shlapak Group Co. Ltd of America, which has the concession contract for the project. The company is now finalizing discussions with electricity buyer Electricity Generating Authority of Thailand (EGAT). So far the feasibility study and economic analysis have been completed and the Group is scheduled to conclude the Concession Agreement with the Lao PDR government. The construction is expected to be finished in the year 2002.

Nam Ngum 2 is located about three kilometers north of the present Nam Ngum reservoir (Nam Ngum 1) or about 90 km north of Vientiane. A concrete faced rockfill dam, 118m high, has been established to be a feasible design. The elevation of the dam crest will be at 376.5 m above sea level . The average long term monthly inflow will be 197.8 cubic meter per second and the spillway was designed for a probable maximum flood inflow of 10,890 cubic meter per second. The maximum operating level is 375m above sea level with a dropdown of 40m. The power plant located at the foot of the dam will be installed with three Françis turbines capable of generating 205 MW each, and will bring the total installed capacity of 615 MW. During the construction phase, all water will be diverted through two tunnels of 11.5 m diameter with the total capacity of 3.850 cubic meter per second. One of the tunnels will later be converted into a low level outlet. The NamNgum River is a major branch of the Mekong River and at present it has only one hydropower station tapping its flow, the Nam Ngum 1, which has a generating capacity of 150 MW.

The companies which form the Group include Shlapak Development Co Ltd from U.S.A., Biffinger, Beger Bauaktiengeselleschaft, Siemens AG, JM Voith GmbH, Noell GmbH from Germany, and Ch Karnchang Co Ltd and Sri U-Thong Co Ltd from Thailand. The Group has also employed well-known consultants, such as Bechtel International Inc. of USA and Electrowatt Engineers and Consultants of Switzerland. These engineering advisors also made economic studies and analyses.

NATIONWIDE RESETTLEMENT POLICIES

A consultation session on nationwide resettlement issues, especially those forming the re-settlement plans at the Nam Theun 2 hydroelectric power project (NT 2), was held in early March by the State Planning Committee office in cooperation with NT2 resettlement project.

Vice-chairman of the State Planning Committee Leuan Sombounkhan who co-chaired the meeting said: "This is the final technical consultation session regarding nationwide resettlement policies, and our aim is to discuss and formally draft a policy for nationwide resettlement. The policy agreed upon at this meeting will form the basis for all resettlement issues and will provide an operational plan for all resettlement projects in the entire country." He added that the main purpose of the policy is to provide an effective mechanism for people to be included in a process, and to treat people fairly so that the benefits of the various projects will be distributed equally to all concerned. He also pointed out that most people to be resettled live in areas which are sparsely populated, so it can be possible to resettle those people without major disruption to their general standard of living. However the policy must be absolutely clear because all of the resettlement projects will affect people differently. All resettlement projects must cooperate closely with the government, in order to respond effectively to the needs of the people who will be resettled, and to mitigate any potential difficulties they may face.

Most of the resettlement projects are concerned with hydroelectric power projects either planned or in the process of being built. Many of these projects have contributed to the development of local areas, such as building linking roads to newly built schools and hospitals. It was noted that the NT2 resettlement project concerns 898 families who are in need of resettlement. Of this total 50 families have already been resettled, and their needs are now being monitored in the form of a case study for the government to review so that it can better plan for the remainder of the families. The resettled were given a choice of between four alternative occupations, which were: rice farming, tree planting, animal breeding, and working at a wood factory near by the village. The governor of Khammouane province confirmed that the 50 families seem to like the new village, and apparently enjoy tree planting, livestock breeding and working for the wood company the most.

PUBLIC INFORMATION CENTRE FOR NAM THEUN 2 OPENED

The Science, Technology and Environment Organization (STENO) opened a public information centre on Nam Theun 2 hydroelectric power project in Vientiane, on March 22. The centre, located in a vast room in the Nahaidiao compound, is opened everyday from 8-11:30am and from 2-5pm. All kinds of information on the Nam Theun 2 but also on other important projects of the government are available. Visitors are also welcome to give their ideas and recommendations. On display are information sheets and posters on various aspects of the project with visual aids and computers.

Together with the public consultation process started last January, this is part of the transparency policy wanted by the Lao government for the Nam Theun 2 project. A second public consultation will take place in April, followed by a third one in June or July. There will also be a number of meetings where results of various studies commissioned by the government will be publicized and discussed.

DONORS MEETING ON DEVELOPMENT IN SEKONG

A Roundtable Meeting (RTM) on development in Sekong province, run by the United Nation Development Program (UNDP) and Sekong province has closed with international donors accepting priority projects for the province. Sekong is located in a mountainous region that possesses considerable potential due to the abundant natural resources. The province covers 7,665 square kilometers, 60 per cent of which is mountainous, 35 per cent plateau and 5 per cent is lowland plains. It is the province with the highest share of ethnic minority groups and the lowest population density in Laos. The majority of the population (63,836) is engaged in shifting cultivation. Only a small percentage of the population is engaged in permanent cultivation and livestock. Sekong province has four districts: Kalum, Lamam, Thateng, and Dakchung. The provincial capital is in Lamam district. Food production is divided into three areas. Lamam district produces food, while Thateng and Dakchung districts produce goods and agricultural products. Kalum district is used for protecting watershed, has forests and a rich environment. It also contains the province's hydropower industry.

Opening the meeting held from February 4-5, Sekong governor said that Sekong was the least developed and the poorest of all the Lao provinces. The Lao government has given its attention and put more capital into socio-economic development over the last few years. All of this capital has been used for improving the living conditions of minority groups step by step. Capital and technicians from friendly countries and international organizations are needed for the development of the province which will bring it up to the level of other provinces in Laos. The governor of the province then presented the following priority projects: (1) irrigation (survey, design, construction); (2) environmental projection; (3) maintenance and construction of roads between provinces and districts; (4) promotion of commercial products; (5) creation of permanent and sustainable occupations, improvements in the quality of life; (6) human resources development; (7) UXO clearance, community awareness; (8) improvements in education, extension of primary schools and kindergartens; (9) focus on two season rice production; (10) opening up of new areas for paddy fields, where possible.

UNDP resident representative pointed out that the purpose of the roundtable meeting is to develop a deeper understanding of the needs and opportunities in this province; to foster a feeling of cooperation and coordination in addressing these challenges together. The UN was ready to support the roundtable meeting and all ensuing development in Sekong resulting from it. He then said that the project UNDP has in mind to develop Sekong is training for officials, at district and local level. A second idea is for development of irrigation systems and fishing. After completing the two projects, UNDP will provide other help and is very ready to help develop Sekong.

The representative of the World Bank (WB) expressed the hope that the WB can help to implement the province's ongoing projects. WB is supporting the renovation of the provincial hospital, the provision of medical equipment and construction of dispensaries for healthcare. The WB has also been supporting the Lao Upland Agriculture Development Project which focused on the agricultural development of the Boloven plateau, thus including Thateng district in Sekong, help agriculture and forest in the field. The representative from the World Health Organization (WHO) said that WHO will discuss, with other organizations, help for healthcare in the field.

More than 60 participants attended the RTM, representing Lao and foreign organizations, non-government organizations, ambassadors to Laos and local officials. All the representatives expressed their readiness to discuss the gradual development of Sekong province.

RICE TRANSPLANTATION FOR DRY SEASON

Rice transplantation for this dry season's rice crop has almost been completed, and will hopefully be finished by early April. As of February 27, the process had covered 26,000 ha of paddy fields, accounting for 87 per cent of the total 30,000 ha. Taking the lead in transplantation is Vientiane municipality, where local farmers have transplanted 11,412 ha of paddy fields, surpassing the target set at 10,500 ha. The municipality is followed by Savannakhet province, with 4,315 ha transplanted, surpassing the target set at 2,400 ha; and the southernmost province of Champassak with 1,420 ha transplanted, exceeding the target by 670 ha. Other important rice-producing provinces are southern Attopeu province with 120 ha; the southern province of Sekong with 190 ha transplanted; southern Saravane province with 1,110 ha; central Khammouane province with 457 ha; the central province of Borikhamsay with 457 ha; and Vientiane province with 2,360 ha.

The ability to exceed targets in many central and southern provinces has been attributed to effective irrigation systems, while the transplantation in the northern provinces, including Phong-saly, Luang Namtha, Oudomsay, and Bokeo, lags behind the targets due to a shortage of irrigation equipment.

PLANNING THE ERADICATION OF SLASH AND BURN PRACTICES

A plan to reduce slash-and-burn cultivation was discussed at a stakeholder workshop held by the Forestry Department and Asian Development Bank. The workshop gathered stakeholders concerned with Sweden cultivation to seek their advice and experience for the design of a project aimed at stabilizing shifting cultivation practices in northern Laos from 1996 to 2000. The work- shop was held to facilitate a constructive dialogue among stakeholders, to identify a range of potential solutions for reducing shifting cultivation, to initiate participatory process for priority setting, and to foster commitment to the proposed shifting cultivation stabilization project. The discussion focused mainly on identifying effective methods for implementing government policy, best practices and approaches for stabilizing shifting cultivation, and priorities for intervention to achieve this goal in the Lao PDR. During the workshop a plan for the stabilization of shifting cultivation to the year 2000 was presented. The plan focused on providing permanent occupations to all swidden cultivators.

The stabilization of shifting cultivation is a major government program, supporting the overall state policy objective of enhancing people' s livelihoods and ensuring the sustainable use of forest resources. A variety of pilot activities and studies related to the stabilization of shifting cultivation have been carried out. Basing its planning on government policy and the findings of these pilot projects and studies, the Asian Development Bank is preparing a project which will introduce extension services, appropriate land use systems and provide necessary infrastructure. According to the government's plan for stabilization of slash-and-burn cultivation, one of the government's main priorities, the government will try to resettle about 100,000 swidden families by the year 2000. These farmers will be encouraged to take up alternatives such as planting trees, raising animals, planting plants, working in processing factories, or trading instead of swidden cultivation. To facilitate the resettlement, the government must guarantee farmers access to necessary financial and technical assistance, by helping with land clearing and construction of irrigation systems. To make the plan successful, the Ministry of Agriculture and Forestry has planned to promote certain families as role models for others.

In the Lao PDR, shifting cultivation is causing an alarming amount of forest destruction. At present there are approximately 220,000 families, or about 1.3 million people, practicing this kind of agriculture. The situation is critical in northern Laos where the terrain is hilly and population pressure on arable land is high. The total rice production area in Laos is about 610,000 ha. Approximately 133,000 ha is in the north, while the central and southern regions have 33,000 ha and 24,000 ha respectively.

PIMAI CELEBRATION AT THE LAO EMBASSY

On the occasion of the Lao Pimai, Lao New Year, 2540, the two Diplomatic Missions of the Lao People's Democratic Republic in the U S : The Embassy in Washington, DC and the Permanent Mission to the United Nations have jointly organized a celebration party at the Embassy in Washington, DC , on April 13, 1997. About 500 native Lao and Americans guests, from several parts of the US and Canada, have attended the event.

The programs begun with a Baci, Lao traditional wishing ceremony followed by a lunch reception. H.E. Hiem Phommachanh gave a speech before cultural performances started. Contributed to the cultural program were traditional amateur dancers from New York, Rhode Island, Philadelphia and Virginia, Khene and Khene Hmong players from Virginia and California, Pong Lang musicians from Virginia, folk singers: Khamla Nokeo (Laos), Ko Viseth (Arizona), Kethsana (California), Phone Phoumithone (Virginia) and Vina Phonseya (Virginia). The party was closed late in the evening by a series of Lao dances such as Lamvong, Saravane, Tangvay and Luangprabang.

The celebration was preceded by a religious blessing ceremony on April 11, given by five monks from Wat Lao Budhavong (Virginia).

Following is the welcome speech of Ambassador Hiem Phommachanh.

" Distinguished guests,

Ladies and Gentlemen,

On behalf of the staff of our Embassy in Washington, D.C. and our Permanent Mission to the United Nations, I would like to thank you all for sharing your Sunday with us, to join in celebrating our New Year, 2540, especially those who traveled from far away as the West Coast and Canada. Our special thanks also go to our friends who have contributed to making this event a success, though many were unable to celebrate here with us. We particularly appreciate the participation of our folk singers and dancers who will entertain us shortly. Such contributions and participation make this a festivity that all can appreciate and enjoy.

We celebrate this New Year in the context of recognizing that our country has achieved important progress in many fields. Thanks to political and social stability for more than twenty years, our multi-ethnic people have succeeded in strengthening unified focus on socio-economic development for the future....for generations to come.

On the international scale, because we conduct relations with other nations honorably and fairly, Laos has gained the respect and friendship of many nations and international organizations that offer valuable support. By the end of 1996, investors from about 30 countries around the world were pursuing over 600 projects, worth over US 6 1/2 billion dollars, and the number of tourists rose to over 400,000.

An increasing number of overseas Lao have regular and varied contacts with our motherland, and already this year, in monthly average 1,000 native Lao from the US and Canada have visited their relatives in Laos.

In the past year, despite the small size of our staff, we have worked hard to respond to all requests in a timely manner and we apologize for any inconveniences you suffered. We are continuously striving to improve our services....and making progress.

In concluding my remarks, I would like to take the opportunity of this auspicious occasion to wish all of our friends and guests the best of health, happiness and prosperity in this New Year.

Thank you for your attention, and please enjoy our celebration. "

***************

WE WISH YOU

A HAPPY AND PROSPEROUS

LAO New YEAR 2540

Embassy of the Lao People's

Democratic Republic

2222 S Street, NW

Washington, DC 20008

********************