China land deal rankles Laos capital

By Darren Schuettler

VIENTIANE (Reuters) - In the eyes of Laos' Communist rulers, trading Vientiane's biggest wetland for a new sports stadium seemed like a good bargain.

But the handover of the That Luang marsh to a Chinese-led joint venture has been the talk of this sleepy capital, fuelling rumors and resentment of Beijing's growing influence over its impoverished, landlocked neighbor.

More surprisingly, the discontent has forced the Lao government, one of Asia's most secretive, to publicly explain the swap of a prime piece of land for a new sports complex that will host the Southeast Asian Games in 2009.

"Many people are angry with the government," said Lin, whose home sits near the marsh on the outskirts of the city of 460,000.

Rumors about a Chinese takeover of the 20 square km (7.7 square miles) wetland -- home to 20 species of fish, rice paddies and ringed by 17 villages -- began to swirl last September.

"We heard that 4,500 families would come from China. Many people were worried," he said of fears they would be evicted.

"My feeling is 'why do we have to give this land to China'? If we are not ready to host the SEA Games, why do we need it? The government just wants to improve its image".

Resource-hungry China is one of the biggest foreign investors in Laos, which dropped central planning for market reforms in 1986, more than a decade after the Pathet Lao seized power.