10 p.c. of Laotians in exodus so far

Press, 17 November 1980, Page 34

10 p.c. of Laotians in exodus so far

NZPA-Reuter Vientiane At least 250,000 Laotians, almost 10 per cent of the country’s population, have left Laos since the Communist Government took power five years ago.

More than 1000 people a month are leaving Laos to cross the Mekong River for refugee camps in Thailand, according to diplomatic, aid, and government sources in Vientiane.

Refugees interviewed recently have blamed rampant inflation combined with a wage freeze, and not political oppression, for the exodus.

They say the money they earned in Laos did not buy them enough food to live on. “It just wasn’t possible to get by any longer,” said one refugee who left earlier this month.

The Laotian Government admits that the economy is in a mess but puts most of the blame on a 10-week closing of its border with Thailand which, it says, set back its effort to get the economy into shape. Thailand, on which landlocked Laos depends for much of the transport of its import and exports, closed the border after an incident on the Mekong River in which Laotian forces fired on a Thai patrol boat which it claimed was close to the Laotian bank. A Thai naval officer was killed. Bangkok accused Vientiane of provoking the incident and demanded an apology before the border was reopened, which Laos refused to give. Thailand eventually changed its mind and reopened two crossings near Vientiane without receiving a public apology. But in the 10 weeks that the border was closed great damage was done with gen-

eral shortages being met by smuggling which pushed up prices several-fold, Government officials said. Last December, as part of sweeping economic reforms, the Government introduced a new National currency, the kip, to replace the “liberation kip" circulated after the 1975 Communist victory which was being officially exchanged at 400 to the United States dollar.

It was worth almost five times as much on the black market and it was the black market rate that was heavily influencing the price of imported goods. official sources said. The Government did not immediately announce a new i exchange rate, but waited .several days until the kip i found a level on the black i market — and then set it at the same rate of 10 to the dollar.

It also doubled Government salaries and kept a strict control on the moneysupply to try to limit money available to buy dollars or baht, the much-used Thai currency, so that black market rates and prices stayed down.

According to foreign residents in Vientiane, the policy worked reasonably well until the border dosing when dependence on smuggled goods — Laos has virtually no industry — [pushed up prices and the black market rate to more than double the official level.

As a result the price of the basic necessities, rice, vegetables and meat are now taking up most urban people’s income.

Government workers are allowed to buy 20 kilograms for each adult member of their families and a smaller amount for their children in Government shops at three kip (30c) per kilogram.

But Laotian families tend ito be large and many people 'complain they are forced to spend their entire salaries, ian average 200 kip (§2O) a i month, simply buying rice. Anyone buying rice on the I “free market” at the moment is forced to pay up to 120 kip (§2) a kilogram, although the price should drop lin the next few months as I the harvest comes in. i The price of meat is now I virtually beyond the buying lability of anyone living entirely on a Government ryTo ease the problem, the [Government is persuading I everyone living in the towns ito grow food in kitchen gardens and allocating plots of land, often at some distance from their homes on which they can grow a little more. It also supplies GovernIment workers with chickens imported from Thailand and animal feed at low prices to provide supplementary food. But even . this is not enough and many government workers are forced to find other means to make extra money’ to buy clothing or soap, as well as the occasional luxury item, officials say. One favoured method is to sell off part of their Government petrol entitlement. Each Government worker is allowed to buy 15 litres (three gallons) of petrol at four kips (40c) a litre, and many with small motorcycles use little of this allocation and make 20 kips ($2) a litre selling the surplus on the black market.

Others sell ice from their refrigerators, taking advantage of extremely cheap electricity available from a major hydro-electric power station built with international aid some 100 km north of Vientiane.-