[News] Laos Has Tackled COVID-19, But It Is Drowning in Debt to International Finance

[Anti-Imperialist News]

https://www.counterpunch.org/2020/07/16/laos-has-tackled-covid-19-but-it-is-drowning-in-debt-to-international-finance/
Laos
Has Tackled COVID-19, But It Is Drowning in Debt to International Finance
by Vijay Prashad <https://www.counterpunch.org/author/drespu/> - July 16,
2020
------------------------------

On June 11, Laos (Lao People’s Democratic Republic)—a country of 7 million
in Southeast Asia—said it had temporarily prevailed over COVID-19. Prime
Minister Thongloun Sisoulith said
<https://laotiantimes.com/2020/06/11/laos-declares-victory-over-covid-19/>
that his country had “gained an important victory in the first campaign
against this vicious enemy.” The first cases
<https://www.covid19.gov.la/index.php?r=site%2Fdetail&id=330> of COVID-19
detected in Laos were registered on March 24; a total of 19 people
<https://www.covid19.gov.la/index.php> had been infected with the
virus by April
12 <https://en.wikipedia.org/wiki/COVID-19_pandemic_in_Laos>, and—after 58
days of no new cases <https://tinyurl.com/y724dxd9>—the last patient was
discharged
<https://laotiantimes.com/2020/06/11/laos-declares-victory-over-covid-19/>
on June 9. There were no new cases of COVID-19 in Laos since April 12 (93
days of no new cases as of July 14). There have been no deaths
<https://www.worldometers.info/coronavirus/country/laos/> from COVID-19 in
Laos.

Laos is a landlocked country, surrounded by the People’s Republic of China,
the Socialist Republic of Vietnam, Myanmar, Thailand, and Cambodia. It
shares a 423-kilometer border with China, across which traders and tourists
routinely travel. Nonetheless, Laos—like its neighbor Vietnam—has had no
deaths from COVID-19. Laos has been particular about the possibility of
transmission through travelers who have crossed from neighboring countries
(which is why they
<https://laotiantimes.com/2020/07/07/4061-individuals-isolated-amid-covid-19-concerns-in-laos/>
are being held in quarantine centers for two weeks).

*How Did Laos Do It?*

News came
<https://peoplesdispatch.org/2020/04/23/how-the-chinese-authorities-and-the-who-handled-the-coronavirus/>
from Wuhan, China, in the first week of January of the spread of a new
coronavirus <https://www.thetricontinental.org/red-alert-7-coronavirus/>.
On January 6, Laos’ Prime Minister Thongloun was in Beijing
<https://www.chinadaily.com.cn/a/202001/07/WS5e13dc1aa310cf3e35582d59.html>
for talks with China’s President Xi Jinping and Premier Li Keqiang, where
their conversations were mainly about economic development. In particular,
the leaders of the two countries discussed the China-Laos railway, which
has been in the works since 2016 and will run for 414-kilometers from
Vientiane (Laos’ capital) to Boten (on the China-Laos border). At the time,
too little was known about the coronavirus for it to have been a likely
focus of the meeting. Until January 20, there was no clarity that this
virus could be transmitted
<https://www.thetricontinental.org/studies-2-coronavirus/> from human to
human. As soon as the World Health Organization declared
<https://www.who.int/dg/speeches/detail/who-director-general-s-statement-on-ihr-emergency-committee-on-novel-coronavirus-(2019-ncov)>
a public health emergency of international concern on January 30, the
government of Laos set up
<https://laotiantimes.com/2020/01/30/laos-steps-up-efforts-to-prevent-coronavirus-outbreak/>
a Taskforce Committee for COVID-19 Prevention and Control to monitor the
virus and prevent its spread in Laos.

The first sign of trouble came on February 1
<https://laotiantimes.com/2020/02/03/chinese-national-carrying-coronavirus-travels-through-laos/>,
when Zhang Biao, who had recently visited Laos, was found to have the virus
upon his return home to Chongqing, China. On January 26, Zhang arrived in
Vientiane on a China Express Airlines flight as part of a tourist group. He
traveled with the group to Vang Vieng, a tourist destination four hours
away from Vientiane. He returned to China on January 31, where he was found
to be infected. In response, the Laotian authorities retraced his steps,
tested people who had come into contact with him, and aggressively moved to
prevent any further infections. Laos suspended
<https://laotiantimes.com/2020/02/02/laos-suspends-visas-at-checkpoints-bordering-china/>
the issuance of visas to Chinese nationals, and Lao Airlines reduced
<https://tinyurl.com/y8noucye>its flights to China (not only is China the
main market for Lao Airlines, but the tourist trade in Laos is also almost
entirely reliant upon China). There were no confirmed cases
<https://laotiantimes.com/2020/01/28/laos-remains-free-of-new-wuhan-coronavirus/>
of COVID-19 in Laos until almost two months later, March 24
<https://laotiantimes.com/2020/03/24/laos-confirms-first-covid-19-cases/>.

On March 5, Laos’ Deputy Minister of Health Dr. Phouthone Muongpak held a
press conference where he said that there had been 53 suspected cases of
COVID-19 in the country, but each of the patients had tested negative. “We
are confident in our surveillance system,” said
<https://tinyurl.com/yan7sryg> Dr. Phouthone, the deputy head of Laos’
Taskforce Committee for COVID-19 Prevention and Control. Teams of
epidemiologists traveled to places in Laos where there were reports of
deaths that appeared to be from COVID-19; samples taken from the bodies
were tested at three laboratories: the National Center for Laboratory and
Epidemiology (which had WHO experts oversee the test), the Institut Pasteur
du Laos and the Microbiology Laboratory at Mahosot Hospital. They all came
back negative. Additionally, samples were also sent to the WHO laboratory
in Australia and came back negative, said
<https://global.chinadaily.com.cn/a/202003/04/WS5e5f4abea31012821727c44a.html>
Dr. Rattanaxay Phetsouvanh, the director-general of Laos’ Department of
Communicable Diseases Control.

The Vientiane Times credited <https://tinyurl.com/yan7sryg> the lack of
cases in Laos to the rigorous scanning and testing done at ports of entry
and the quarantines imposed on those who entered the country. Even those
who showed no symptoms when they entered Laos were told to go into
self-imposed quarantine for two weeks. Showing an abundance of caution, on
March 9, the government declared
<https://www.rfa.org/english/news/laos/laos-coronavirus-public-events-03112020170451.html>
that celebrations of Lao New Year (April 13-15) would be canceled.

In fact, there were no cases in Laos from January 30 until March 24, when
the first two confirmed cases
<https://laotiantimes.com/2020/03/24/laos-confirms-first-covid-19-cases/>
were reported: they were a 28-year-old male hotel worker from Vientiane who
most likely contracted the virus during a work trip to Bangkok, Thailand,
in early March, and a 36-year-old female tour guide from Vientiane who most
likely contracted it from a tourist (as reported to me by a government
official). Both patients were taken to the Mittaphab “150 Bed” Friendship
Hospital in Vientiane, which was soon to be designated as a COVID-19
hospital.

Five days later, on March 29, the Lao government announced
<https://tinyurl.com/y7v9v3al> a full lockdown of the country. Any
necessary activity would have to follow the strict WHO protocols of
physical distance, mask wearing, and hand washing. The task force was
enjoined to train medical professionals and the security services, develop
plans to break the chain of infection (including testing, contact tracing,
quarantine, and treatment), and use the public sector to procure necessary
medical equipment (including protective gear and ventilators). The
government agencies were told to “provide detail[ed] guidance”
<https://tinyurl.com/y7v9v3al> in an easy-to-understand format through the
various government media and through a special website
<https://www.covid19.gov.la/index.php>; only science-based information was
to be transmitted to the public.

On July 8, Tricontinental: Institute for Social Research released a report
<https://www.thetricontinental.org/studies-3-coronashock-and-socialism/>
called “CoronaShock and Socialism.” The text looks closely at the
experience of four parts of the world with socialist governments—Cuba,
Venezuela, Vietnam, and Kerala, India—and how these parts of the world were
able to substantially break the chain of infection. The analysis showed
that these countries were better able to deal with the virus because they
took a science-based approach, they had a public sector that they could
rely upon for the production of the materials they needed to combat the
virus, and they cultivated public action. Laos very much followed these
principles, as two officials at the Ministry of Health informed me via
telephone in early July. In addition, Laos received essential materials
(protective suits, masks) from both Vietnam
<https://vietnamtimes.org.vn/friendship-association-assists-laos-covid-19-fight-with-500-protective-suits-18500-masks-19642.html>and
China <https://tinyurl.com/y8yxmmk7> (Chinese medical personnel also came
<https://tinyurl.com/ya5ldbh3> to assist the Laotian medical service).

In June, Prime Minister Thongloun said
<https://laotiantimes.com/2020/06/19/international-health-organizations-praise-laos-for-covid-19-containment/>
that—for now—Laos appeared to have beaten back the virus. Dr. Howard Sobel,
the WHO representative in Laos, concurred. The response of the government
of Laos, Dr. Sobel said, “was exemplary. The government anticipated the
arrival of this terrible disease and did all the right things to stop it
spreading.” Doubts about the low number of cases and the lack of deaths
were set aside by Ludovic Arnout of the International Federation of Red
Cross and Red Crescent Societies. “It’s difficult to hide [coronavirus
cases],” he said, “so I believe it.”

*Impact*

Laos has not fully recovered from the impact of the U.S. bombing of the
country: 2.5 million tons of U.S. bombs dropped on Laos between 1964 and
1973, with the soil in many parts of the country polluted
<https://www.theatlantic.com/international/archive/2019/07/agent-orange-cambodia-laos-vietnam/591412/>
for generations. When U.S. President Barack Obama visited Laos in 2016, he
regretted <https://www.bbc.com/news/world-asia-37286520> the “biggest
bombing in history,” but he did not apologize for it. He promised $90
million over three years to remove an estimated 75 million unexploded bombs
that continue
<https://www.ipsnews.net/2008/10/laos-unexploded-cluster-bombs-hold-up-farming/>
to claim lives and damage agriculture decades after the “secret war” ended.

Nonetheless, the communist government in Laos has—with investment from
China—persisted in a development pathway that has brought some gains for
its population. Basic human indicators have improved
<https://tinyurl.com/y7ofy2zd>, and for the past two decades unemployment
has remained under 1 percent.

But the coronavirus recession will strike Laos very hard. In April,
Anousone Khamsingsavath, director-general of the Department of Labor Skill
Development at the Ministry of Labor and Social Welfare, said
<https://tinyurl.com/ybfsjofw>, “Poverty in Laos will be exacerbated
because large numbers of people have been laid off from their jobs.” Her
ministry “reported recently that the unemployment rate had surged from the
average of 2 percent to 25 percent at present,” according to the Vientiane
Times <https://tinyurl.com/ybfsjofw>. The World Bank noted
<https://www.worldbank.org/en/country/lao/publication/covid-19-to-impact-lao-pdr-growth-debt-in-2020-new-world-bank-report>
that while Laos has “so far avoided a health crisis,” it has not been
“immune from the global economic downturn.” Growth rates, which had been
estimated before the pandemic to be secure at 7 percent, will collapse
<https://www.worldbank.org/en/country/lao/publication/covid-19-to-impact-lao-pdr-growth-debt-in-2020-new-world-bank-report>
to near zero as a consequence of the global coronavirus recession.

Most terrifyingly, this will mean that Laos, which had a relatively stable
economy, will slip into debt and chaos. In May, Fitch Ratings downgraded
<https://www.fitchratings.com/research/sovereigns/fitch-revises-laos-outlook-to-negative-affirms-rating-at-b-15-05-2020#:~:text=Fitch%20Ratings%20%2D%20Hong%20Kong%20%2D%2015,Outlook%20to%20Negative%20from%20Stable.>
Laos’ Long-Term Foreign-Currency Issuer Default Rating to B- and revised
its overall outlook from “Stable” to “Negative.” This change in Laos’
economy is mostly due to the effects of the coronavirus on the global
economy. Laos is slated to make a debt servicing payment of about $900
million in 2020, money that it simply cannot afford to pay (its foreign
exchange reserves are a mere $1 billion).

“We defeated the virus crisis,” a government official told me. “Now we are
going to be defeated by the debt crisis, which we did not create.”

*This article was produced by **Globetrotter*
<https://independentmediainstitute.org/globetrotter/>*, a project of the
Independent Media Institute.*

*Vijay Prashad’s most recent book is No Free Left: The Futures of Indian
Communism (New Delhi: LeftWord Books, 2015).*
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