Laos faces thorny land issues in Asia's orchard

In the north, where a new paved highway to China's border opened last month, Beijing firms are heavily investing in rubber to feed their country's surging auto industry.

Yunnan Natural Rubber Industrial Co plans a 66,700 hectare plantation in Laos, aiming to double it to 133,300 hectares by 2010 and to 333,300 hectares by 2015.

Vietnam, one of Asia's fastest-growing economies, is carving out concessions in Cambodia and southern Laos for rubber trees and other cash crops.

Japanese, Indian and Scandinavian tree farms dot central Laos, while Thai tapioca growers are shifting their operations across the Mekong River into Laos to benefit from lower European import tariffs granted to poor nations.

Some argue the scale of the plantation sector is not really known because Laos has no land inventory, although it is working on one. Another issue is that multiple levels of government can grant concessions, leaving the door open to corruption.

"The national government has a hard time understanding what is going on. Even at the district level, concessions are given that the province does not know about," said the foreign advisor who would not be identified because he was not authorized to speak.

Other foreign experts and researchers asked for their names to be withheld due to concern the authorities might expel them or hamper their work if they spoke out of turn.

WHERE ARE THE COCONUTS?

Last May, Prime Minister Bouasone Bouphavanh declared an indefinite moratorium on large land concessions for mining and agriculture "to address shortcomings of our previous strategy".

Some plantations had turned out to be illegal logging camps. In one case, a foreign investor who promised vast swathes of coconuts stripped the concession of its valuable timber and left.

Yet only a month into the moratorium, the governor of Vientiane province granted 705 hectares of land to a South Korean rubber project, according to state media reports.

"Plantations need land and local officials can deliver it. They go to a village and say 'this land is degraded and can be used for plantation development'," said a researcher with a foreign NGO.

In northern Laos, once home to swathes of opium-covered hills that formed part of the infamous Golden Triangle, farmers are now planting rubber trees under contract to Chinese firms.

"They are told they will become rich and own lots of Vigo pickup trucks," said a foreign academic who studied plantations in Oudomxay province. In reality, the farmers will have to tend their trees for seven years before any latex is tapped.

The government says plantations are fighting poverty by employing villagers, including ethnic minorities relocated from upland areas with promises of schools, healthcare and new land.

But critics say the policy has ensured a cheap source of labor for the plantations.