Chinese investment in Laos

Few more striking contrasts exist than that between China, the world’s second most populous nation and second-largest economy, and Laos, one of the smallest, least populated countries in the world. And yet, in the last two decades, the two countries have grown increasingly intertwined, with China becoming Laos top investor and creditor and its second largest trade partner. This relationship is pivotal for understanding current and future economic, environmental, and political trends in Laos, as well as China’s engagement with neighbors and other countries where it invests. This report provides a detailed snapshot of Chinese investment in Laos across four key land-intensive sectors: agriculture and tree plantations, mining, infrastructure projects, and special economic zones. This compilation of key sources and statistics reviews the extent, geography, and political economy of Chinese investments in each sector. We also include a selection of case studies on specific projects to unravel deeper motivations, tensions, and key processes. This report foregrounds the diversity and importance of context. The four sectors are affected by different driving factors, actors, institutions, regulations, and Chinese investments over time and across space. We draw on under-utilized sources to carefully contextualize and preliminarily interpret the available data. We also discuss avenues for future research, including comparing China to other investor countries and improving the quality and transparency of monitoring and evaluation of extractive and infrastructural investments in Laos. Ultimately, this report aims to serve the research community in Laos that has given us so much, support better decision-making, and inspire further research.

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