China leveraging Laos to link up its Southeast Asian economic interests

Premier Li Qiang visited Laos earlier this month, with the relatively undeveloped and small Southeast Asia nation seen as key to China’s plans in the region

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Chinese Premier Li Qiang and Lao Prime Minister Sonexay Siphandone attend the inauguration ceremony of the China-aided Mahosot General Hospital building in Vientiane, Laos. Photo: Xinhua

Published: 9:00am, 27 Oct 2024

China aims to scale up infrastructure construction in uniquely strategic Laos to accelerate trade and investment throughout Southeast Asia as Chinese businesses scout for space to grow offshore, analysts said.

Premier Li Qiang said during a four-day visit to the Southeast Asian nation earlier this month that he would work with Laotian officials to turn Laos from landlocked to “land-linked”, according to the Ministry of Foreign Affairs.

Laos, relatively undeveloped and small at just 7.4 million people, matters to Beijing because it shares borders not only with China, but also with the larger Southeast Asian economies of Cambodia, Myanmar, Thailand and Vietnam.

“Laos is seen as a transport hub for China to export Chinese products to the other countries in the subregion and import products from those countries to China,” said Supitcha Punya, an assistant professor of political science and public administration with Chiang Mai University in Thailand.

China would eventually add roads, airports and dry ports tethered to a 400km (249 mile), US$5.9 billion railway that was finished in 2021, the Asean+3 Macroeconomic Research Office (Amro) in Singapore said in January last year.

The additions would boost China’s economic reach in Southeast Asia for its own landlocked western regions, said Naubahar Sharif, head of public policy at the Hong Kong University of Science and Technology.