The Cambodian authorities maintain that the construction work, involving a newly-dredged port and ship-repair facility, is part of an expansion project in Cambodia’s national interest, while insisting that the Southeast Asian nation does not intend to play host to Chinese troops. Yet whatever the truth, or the strategic implications of a potential Chinese staging post on the Gulf of Thailand, the growing disquiet in Washington over the Beijing-backed upgrade of the base reflects a realization that there is very little the United States can do to avoid yielding influence to China in Cambodia.

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The hydropower projects are among many in Laos, which already has 78 dams in operation and has signed agreements for another 246 projects, according to Radio Free Asia. Laos has the potential to produce up to 28,000 megawatts of power by 2030, and aims to become the “battery” of Southeast Asia and export electricity to neighbouring markets in Cambodia, Thailand and Vietnam, and further afield to Malaysia and Myanmar, despite fears of environmental harm from damming the Mekong.

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The rail project has brought concerns that Laos could become a mere transit point on China’s southern route, yet through the high-speed link and other transport projects, Vientiane aims to increase its domestic connectivity and boost trade with Southeast Asian neighbours. In the north, a Chinese-built road link from the capital to Vang Vieng opened in December, while a route to Pakse in the south has recently been given the green light by the government. These projects are expensive and require reliance on China. Yet for Laotian leaders, the potential rewards of opening up makes them a risk worth taking.

High-speed rail project

Work on the high-speed railway had come to a halt amid the COVID-19 pandemic last year, but new safety protocols and a switch to local suppliers enabled construction to resume. Construction is now reported to be 95% complete, ahead of the scheduled opening of the route to traffic on 2 December. All 67 communication towers along the line are now finished, as are 150 bridges and 76 tunnels that the trains will pass through. The main structure of the longest bridge on the route—the Phonethong Super Major Bridge, at 7,528 metres in length and held up by 231 piers—was completed last month.

Once open, the electrified passenger and cargo railway will see trains pass through 32 stations—ten for passengers and 22 for freight services—all of which are expected to be finished by September or October. The route will pass through four northern provinces: Vientiane, Luang Prabang, Oudomxay, and Luang Namtha, before finishing up at the border town of Boten and crossing over into southern China’s Yunnan province. Finishing touches are being applied to the stations at the two biggest hubs along the line, with interior building work underway at a two-platform, four-track station that will be able to accommodate 1,200 passengers in Luang Prabang and the new terminal station in Vientiane.

Trains on the route will operate at 160 km per hour, dramatically cutting the journey time from Vientiane to southern China. The challenges that faced workers on the project—steep terrain, torrential rains, and flooded access roads during the monsoon season—indicate the huge transport obstacles faced by Laos. It is estimated the railway will cut the cost of transport by 40% compared to travel by road, albeit at a total project cost of US $5.9 billion. Around a third of this will be funded by low-interest loans granted by Beijing to the Laotian government—adding to its existing debts and economic struggles.

Chinese-funded roads

The high-speed railway is not the only major Chinese-backed transport project in Laos. In December 2020, a 110 km expressway from Vientiane to Vang Vieng in the north opened to vehicles, allowing travel at 80 km per hour, which cut the journey time to the popular tourist town by around an hour.

A further two, larger-scale road projects are planned. In 2018, several Chinese companies signed an agreement with the Laotian government to build a 580 km highway from Vientiane to Pakse, a city in southern Laos near the Cambodian border. The Ministry of Public Works and Transport reviewed the route in March while prime minister Phankham Viphavanh formally approved the project last month. It will cost US $5.1 billion, with most of the work on the joint project to be undertaken by Chinese firms.

Surveyors are also currently working on the route for a third highway, approved by the government in 2020 at an estimated cost of US $3.8 billion. The 180 km road aims to connect Huayxai in Laos’ eastern Bokeo province, on the border with Thailand, to Boten, on the Chinese border in the north. The road will cut the journey time from northern Thailand across Lao territory to southern China to two hours and will open a route to Thailand over the existing Thai-Laos friendship bridge on the Mekong River.

Land-linked transport hub?

These roads, linking to the high-speed railway at various points, will offer China new overland routes to mainland Southeast Asia, easing the flow of goods. But Laos aims to become a trading destination and transport hub, not just a stopping point on China’s Belt and Road. The highways bring a promise of broader connectivity, providing Laos a greater chance of realising this ambition than if the railway was built as a standalone project. Once operational, this future transport infrastructure will facilitate more trade between provinces and with neighbouring states, acting as a driver of economic growth.

It is still a big risk by Laotian leaders. Amid mounting debts comes deference to China, but Vientiane wants to make up for decades of being left behind in the region’s fast development. Another project, the construction of Thanaleng Dry Port (TDP) and Vientiane Logistics Park (VLP), offers an example of how Laos’ overreliance on China can be reduced. Approved via a United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) resolution back in 2013, the project is funded mostly by donors and aims to link Laos with sea trade routes. As part of the US $727 million project, a railway will be built to connect TDP-VLP with Vung Ang Port, on the coast of Vietnam’s central Ha Tinh province.

More projects like this are needed. Investment in transport infrastructure in Laos by other powers—in the region and beyond—would ensure Laos’ path to opening-up is not so heavily reliant on China.

*This article was originally published on July 30, 2021.

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Ismail’s ascent made him the first premier to come from the United Malays National Organisation (UMNO) since the party was ousted from power after the 2018 election under Najib Razak, whose lengthy stint in office was tainted by the 1MDB financial scandal. UMNO, which had ruled Malaysia since independence from Britain in 1957, was defeated in those polls by a reformist alliance led by veteran Mahathir Mohamad. Mahathir’s coalition collapsed within two years after losing support.

All of that thrust Muhyiddin, of the Bersatu party, into the premiership. He was appointed in the same way as the latest incumbent, Ismail, after cobbling together a coalition with the UMNO last March, just as COVID-19 was taking-off. The pandemic came to dominate his administration, with the economy contracting by 5.6% in 2020 amid repeat lockdowns. Political divides worsened, and infighting led him to suffer the same fate as Mahathir. Ismail now inherits these same problems.

Ismail: Muhyiddin 2.0?

The new government was met with initial skepticism from the opposition Pakatan Harapan bloc led by Mahathir’s one-time protégé, Anwar Ibrahim, president of the Parti Keadilan Rakyat (PKR). Ismail faced accusations that he had revived the resigned Muhyiddin alliance, in which he served as deputy prime minister up until August, albeit with the UMNO now in a more dominant role over Bersatu. His cabinet contains few new faces, with Zafrul Abdul Aziz retained as finance minister, and familiar duo Hishammuddin Hussein and Saifuddin Abdullah assigned to head the defence and foreign ministries.

In a televised address after taking office, however, Ismail indicated he would do things differently, vowing to “stem the grab for political power” and end the “political crisis” that had “caused unrest” in the country. While he has defended his cabinet picks as being dictated by a need for stability and experience, Ismail has promised ‘‘a new approach that is more open’’ to regain public trust. And at least for now, Muhyiddin has lent support to his former deputy and kept Bersatu in the coalition.

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The night-time assault was one of a series of incidents of localized violence in the past few months, which typify the sporadic nature of the insurgency in Thailand’s Deep South. Muslim rebel groups in Thailand’s four Malay-speaking southern provinces have fought for independence for decades, with their motivation rooted in the conquest of the region by the Kingdom of Siam in 1785, and the 1909 Anglo-Siamese Treaty which first marked the border between Thailand and neighbouring Malaysia.

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Duterte—who attended an inauguration ceremony along with the Chinese ambassador—hailed the opening of the bridge, and after a virtual meeting with Xi Jinping on 27 August said he envisaged the completion of more key China-funded infrastructure projects, ranging from flood control to railways. Yet many projects envisaged at the start of Duterte’s six-year presidency—when he departed a state visit to Beijing with US $24bn in investment and loan deals—are unfulfilled as his term nears its end.

‘Belt and Road’ and ‘Build, Build, Build’

Of the loans and investment pledges secured during the 2016 visit, US $15bn reflected company-to-company deals while US $9bn was in the form of expected loans by Chinese banks either for specific projects or to Philippine firms. At least 17 memoranda of understanding or other deals were signed, covering a wide array of projects in sectors ranging from transportation and manufacturing to renewable energy. Proposed Chinese projects spanned the entire 1,850km length of the Philippine archipelago.

In Beijing, Duterte lauded a fresh start for economic ties between the Philippines and China, having announced his “separation” from traditional close ally the United States in front of Chinese leaders. Xi Jinping responded to Duterte’s overture by lifting restrictions on Philippine banana and pineapple exports, which had been imposed years before amid worsening tensions in the South China Sea. The Philippine president, seeking support from Xi, has largely been content to push those disputes aside.

It appeared the path was forged for an economic boom to the tune of the two leaders’ grand plans: Duterte’s vote-winning ‘Build, Build, Build’ program — which has placed upgrades to the Philippines’ overworked national infrastructure near the top of his administration’s priorities — was to receive a boost in the form of long-term Chinese financing under the Belt and Road Initiative. At the western edge of the Pacific, the Philippines marked a lucrative stop along the envisaged Maritime Silk Road.

The mixed fortunes of Chinese projects

In the five years since, however, projects have been slow to get off the ground. In 2020, US $620m of official development assistance from China was disbursed in the Philippines, out of US$4.6bn set aside for current projects, most of which remained at the procurement stage. The Philippines hopes to add another US $1.9bn to that total shortly, with finance undersecretary Mark Dennis Joven remarking last month that the Export-Import Bank of China was evaluating loans for another three major projects.

Finance secretary Carlos Dominguez recently voiced approval in the Philippine Daily Inquirer of China’s implementation of projects that were already underway, but acknowledged that “massive” deals came with bureaucratic red tape, in particular citing “difficulties in getting approvals,” and in construction firms from both countries involved in the joint ventures “understanding each other.”

The fortunes of three China-backed infrastructure projects in 2021 demonstrate these disparities:

In January, a deal was approved for a US $940m freight railway linking two former American military bases in Luzon, the Philippines’ wealthy northern island. The 71 km single-track line will take around four years to build, and when complete will link commercial zones at Subic Bay and Clark Air Base to ports and airports, smoothing the transit of goods and boosting growth in an existing economic hub.

Just days later, the China Road and Bridge Corporation announced a US $400m contract at the other end of the country, to construct a 4 km oversea bridge connecting Mindanao’s Davao City with Samal Island. The four-lane structure will allow vehicle traffic to cross the narrow Pakiputan Strait, boosting trade and tourism in the region. The two projects look set to make a big difference in their localities.

Not all projects have secured the green light, however. In Cavite, the provincial government earlier this year cancelled a decision to award a multi-billion-dollar airport upgrade job to a consortium led by the China Communications Construction Company, scuppering one of the most expensive China-backed projects in the Philippines. Local governor Juanito Victor Remulla told Reuters that the firms in the consortium were “deficient in three or four items” and “not fully committed” to the project.

Remulla insisted that the decision to scrap the contract was unrelated to the blacklisting of Chinese firms involved in the Sangley Airport project by the United States, over their alleged role in building military installations on disputed reefs in the South China Sea. Duterte has rejected scrapping deals with these firms, vowing that infrastructure projects are in the national interest and must proceed.

Belt and Road limited in the Philippines

In all, Belt and Road presents a mixed picture in the Philippines. Only three major China-backed infrastructure projects are set to be finished by the end of Duterte’s term in mid-2022. More are in the pipeline, but much will depend on the winner of next year’s election. Duterte is set to run as the vice-presidential candidate for the ruling PDP-Laban, alongside either Bong Go or his daughter, Sara Duterte-Carpio, the current mayor of Davao. A victory for the Duterte camp would provide a chance for delayed projects to go ahead, while an opposition win would leave the status of projects unclear.

Whatever the outcome, China-funded projects in the Philippines will be more scattered and smaller in scale than elsewhere in Southeast Asia, where massive Chinese investment in places like Laos has brought fears of a “debt-trap.” An expansive mega-project like the pan-Asian railway, which Beijing envisages to run through Laos, Thailand, and Malaysia en route to Singapore is not a prospect in the Philippines, due to its island geography and proximity from China. In the Philippines, Beijing also has less urgency as it has less to gain strategically than it does in its nearest Southeast Asian neighbors.

As a result, Duterte’s shift toward China has been accompanied by an increase in investment linked to the Belt and Road, but not on the massive scale witnessed elsewhere in the region.

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Yet progress ground to a halt early last year as COVID-19 emerged, causing Myanmar’s economy to shrink by nearly 10% in 2020. Then the military coup of 1 February, which marked a sudden reversal of the reforms that had allowed the National League for Democracy to rise to power, had an equally devastating impact. The World Bank now forecasts an 18% contraction in 2021, which would render Myanmar’s economy a third smaller than it was before the double crises of the coup and COVID-19.

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Anger is now directed primarily at the government—led by Prayuth since the military seized power via a coup in 2014. After his five-year stint as a Junta chief, national elections in March 2019 paved the way for Prayuth to be selected as prime minister by 250 military-appointed senators. They had been assigned that task by a new constitution, introduced in 2017. Lawmakers recently voted on a series of amendments to that controversial charter, most of which were proposed by a raft of opposition parties.

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Indonesian president Joko Widodo was quick to respond. In a televised statement on April 26, one day after the ambush, he appeared alongside security chiefs and ordered the police and military to ‘‘pursue and arrest’’ armed rebels in an intensified crackdown. Indonesia has often been accused by human rights activists of employing heavy-handed tactics and discriminating against Papua’s native Melanesian population, who are predominantly Christian—a minority in a Muslim-majority nation. Yet rebels have also been linked to atrocities and have killed teachers and road workers in attacks over the years.

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