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Informal and Illegal Movement in the Upper Greater Mekong Subregion

Lynn Thiesmeyer

Chapter 3. Access to Land and Livelihood Spaces

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1The most informal thing about the New Informal Economy is not really its economy, which appears informal mainly to outsiders rather than to its participants. It is, rather, its spatialization.

2The very fact that we need a term—the Upper GMS—for a region that is neither a nation-state nor comprises any whole nation-state, strongly suggests both our nostalgia for the legendary, less confined expanses of Usa-ka-né, Suwannaphoum, or even the historically recent Sipsongpanna, and at the same time our desire, as academics, entrepreneurs, and government officials to participate in that new-old space and create a new term for that imaginary, unbordered region in which we hope to conduct similarly unfettered kinds of research, or business, or regional policy-making—while at the same time conceptually sedentarizing and confining the region and its activities into fixed terminologies and definitions.

3Another feature of the New Informal Economy in the Upper GMS and its micro-economies is the mixture, within the trade and livelihoods of the region, of what advanced-economy observers would call social space or social capital with economic space and capital. This dynamic, which in the abstract is common to communities in both advanced and developing economies, is essential to the rural border economies of the GMS because the network capital of local and etiolated social (human) connections is often the means by which work and income, and therefore the cumulative (day-to-day) potential for survival, are located. Unlike the newly legalised, economically privatised, and commodified nation-state borders of the region, the socio-economic space would seem to be, if translated into the inadequate vocabulary of the nation-state itself, illegal, common, and continuously bartered, including through non-market mechanisms. The modern border is the main thing that defines trafficking—goods are not considered to be illegally trafficked unless they cross borders—and, as a border that exists and is maintained politically as a means to secure wealth and resources for those within it, it is consigned to the national economy, and is for that reason essentially privatised. The tension between these polarities—the legal versus the illegal border, the economically and socially private versus the border as commons—is what creates the framework of trade and of consumption, defined from the outside as trafficking, whose legality or otherwise is extremely hard to define in terms that the local and informal micro-economy would understand. Neither the transition to the modern economy nor to the modern polity has been fully emplaced. Indeed these border regions are, in the works of the historians who traversed them, always in such economic and political situations of mobility and transition, which is what enables their dynamism and the survival of their denizens.

4For rural working migrants, the carriers and consumers themselves of the trafficked items in these border transitions, what is being left behind, or brought from home, or temporarily escaped, is as important as what awaits or might be obtained at the other end of the journey. Lacks, shortages, and baffled hopes may be rooted in the place of origin. The lack of health care, of adequate education, and of employment are not only push factors to migration and trafficking, but also part of the baggage that migrants bring with them. Though it would be strange to say that they traffic in unemployment and illiteracy, that is precisely what they do. The leisure that results from unemployment is a commodity they can sell to a new employer. The illiteracy that results from no, or inadequate, schooling at home is also a commodity that they can sell to an employer in terms of their being the lowest-skilled, and therefore the cheapest, labour. By getting out of a destitute, or food-gapped, rural area to an employment site in the neighbouring country, the worker also sells the employer a still-healthy body with the capacity to do physical work; and in so doing, the migrant worker can hope for a slightly longer life expectancy as well. Many cross-border destinations offer free health care, including to migrants; more importantly, if the work camp or workplace offers food (or is a place where food crops are cultivated), even the small amount or low nutritional value of the basic foods available is better, and healthier, than the complete lack of food during certain periods in the upland GMS, where some villages have a food gap of up to eight months per year (personal interview with World Food Programme staff, Lashio, Shan State, Myanmar, 1 September 2009).

5On a larger scale, in many areas of the GMS, internal movement itself is restricted or controlled, as is domestic transport or sale of goods by individuals who do not or cannot officially register or pay tax as merchants. A citizen card, ID card, or household registration does not automatically mean that one can move at will within one’s own country to a domestic job opportunity, especially if one is an ethnic minority, as are a large proportion of the upland dwellers near the borders, and is labelled as such on the ID card. Moreover, a large proportion of rural border dwellers lack any ID card at all. Ironically, this makes it vastly easier to cross the border and trade goods, legally or illegally, than to engage in internal labour migration and trade. Any, or in some cases, no ID card is quite legal for gaining a temporary border pass to enter a neighbouring ASEAN country, and thus border passes are easier to use than crossing one’s own country to find employment or barter goods. In point of fact, this legal paradox itself is one of the great drivers of local cross-border movement and trafficking. Further, to a region that historically has survived through its people’s movement, freedom of movement is essential to the whole notion of livelihood.

6Finally, the territorialisation of the border by the modern nation-state and its “nationalisation” and re-construction as a bounded area of laws, restrictions, and tariffs are trends that exist to regulate, and would not exist without the continuance of resistance and fluidity. James Scott points out that in border areas of Laos, most of which are highland minority areas, the highlanders have a “response to the pressure to create a political structure through which the state can act”, which is to produce someone, not their real leader, as their nominal head and liaison to the central government (Scott, 213).

7As we have seen, within the modern nation-state, the GMS borders are still zones rather than sharp, unequivocal lines. An illustrative example is the border area between Thailand and Cambodia at Aranayaprathet – Poipet, where the Thai checkpoint is over 1 kilometre from the Cambodia border entry gate. Similarly, at the border points at Boten and Muang Sing in northern Laos the distance from the government building where the Chinese exit procedure is undergone at Mohan in China to the entry point at Boten in Laos is five hundred metres on a road that can be walked or ridden by tuk-tuk or car, but in a space where no officials monitor the movement of persons and which is surrounded, fenceless, by forests into which people can and do easily disappear. At Muang Sing, the present author once walked up the road from the small customs house on the Lao side without encountering a line, fence, or official person until she was told she had already entered Chinese territory. On a subsequent visit to Muang Sing, she asked the guard at the newly emplaced check booth where, at what exact point, the border was, and was answered with the simple command to “stand back”, after which the guard waved vaguely around his booth to indicate the presumed existence of a border. There also, the road on both sides is forested and there is a village that straddles the putative border, and thus legally exists in two countries. The forest area also provides a route between the two countries where neither fence nor official stops, counts, or taxes those who move, or their goods. At both Boten and Muang Sing, the strip between the two countries is a new territory that, like the buffer zones of the Rattanakosin period that so confounded the British in Burma, can be, and sometimes is, claimed by both sides, but where it is well known that the determining factor is economic power.

1 - The Border as Commons

8The Upper GMS border territory as it is currently constructed by the New Informal Economy is informally used, or, in the historical perspective, maintained, as a commons. This is in direct contradistinction to the mission of the region’s national governments that determine and preserve nation-state boundaries. These latter are particularly restrictive of movements that do not profit those who have officially made and guard the boundary. A dynamic, or tension, thus exists between not the imagined community or imagined border and the traditional mandalic buffer zone, but between two kinds of movement and two kinds of livelihood. The border territory itself is, for its primary users the daily petty traders and farmers, a space of movement; its outer limits—the borders of the borders—also flow and shift, depending on the geographic spread of the social or network capital that enables the movement and informal trade. It also possesses a corresponding series of movements, or shifts, among currency values, labour values, and production values that make it a space of opportunity. The economies of scale or the differentials in income and purchasing power between neighbours are not simply a misfortune for those on the poorer side. They too are an opportunity. Such buffer spaces exist where two or more economies of differing values meet, compete, and blend. This dynamic facilitates, and even necessitates, migration and trade-trafficking that can maximise whatever slight differential in resources or assets the mover or trafficker can offer.

2 - Networks versus National Territories

9In their well-known work on Network Capital, Sik and Wellman frame the non-formal network of (livelihood) transactions as “a simultaneous function of its culture, its past and present social organisation, and the changing socioeconomic situation” (in Wellman, 227). Further, this sort of capital relates directly to informal trade without regard to law.

There are two ways in which network capital can operate in relation to the market and the state: as a substitute or as an addition. When network capital is a substitute, it is used as an institution independent of the dominant institutions, as when people exchange among themselves the goods and services needed for survival (227-228).

10Drawing on earlier work by Karl Polyani, the authors discuss network capital in ways directly relevant to illegal trade within resource-poor communities. It is a type of social capital that is “less costly, more effective, more easily accessible than any other alternative such as the household, market purchases, or acquiring state redistributions”. Moreover, neither market capitalism nor state-sponsored capitalism excludes the networks of non-market transactions (226-227). The authors’ focus on the state and its markets as a separate, and perhaps less functional, system in cases where either the state or the market is not adequately supporting a large number of its potential participants is appropriate here. Further, their recognition that policies about trade, markets, and the economy continue to undergo massive shifts is wholly appropriate to the borders in the GMS: “With laws constantly changing, no one can be certain what is or is not legal. To cope, people must use their network capital to gather information and obtain favours from officials. Yet using such networks further corrupts bureaucracies and distorts markets” (245).

11In Asia, rural populations still comprise over half of all national populations. For this reason if no other, any discussion of this region ought to bring rural societies and their peoples’ lives into sharper focus. Their “economies” are not only the economic activities defined by economists or the state, but are multiple and shifting, and cover a wide range of life and social practises that enable survival. What concerns us here is the ways in which such economic diversity, and the potential for choice among different means of participation, are influenced by globalisation and by unsustainable economic paradigms based on insufficient knowledge.

12Provisional solutions to the region’s problems of shrinking resources, extreme poverty, and lack of capacity can be, and have been, brought in by external actors. They can and have been addressed to some extent by external interventions. Food can be brought in; political regimes can be pressured by means of aid or its withdrawal; schools and hospitals can be built, and jobs can be provided, by international donors, by transnational corporations, or even by neighbouring countries. However, as we all know to our regret these rarely prove sustainable. Food or water lasts a day or a week. Corrupt political regimes have a way of regenerating their own self-serving followers and aims. Schools and hospitals last only until their physical plant and its equipment—in the case of schools, everything from textbooks and stationery to workstations—grow outdated, which is very soon nowadays. The kinds of jobs provided by external organisations or investors to the local workforce are typically not in the nature of permanent contract employment. All of these diverse resources have one thing in common, however, and one that explains their hasty obsolescence: they are not sustainable because they are consumable resources that do not address the bases of the need. These are initiatives based on the kinds of resources—secondary, manufactured, or mediated, as we saw above—that have been the staples of the economic transactions going from developed to developing countries for many decades. They look at resources precisely as such mechanically producible, transactable, and ultimately consumable entities. Sustainability, however, means the opposite of this. In the absence of sustainability, people turn to exchanges of goods “independent of the dominant institutions”, which results in trade being identified as illegal.

13Sustainability has been lost for a number of reasons. In transitional economies like those of the GMS borders, we need to consider the meaning and capacity of land and territories (including border territories) themselves, as seen through the prism of not only modern economic development, but modern nation-state governance and law. The majority of Southeast and East Asian nations (excluding Myanmar and Laos) now have land laws that establish land boundaries, private land ownership, and rules for the administration and / or transfer of land. Further, several of the nations in this region also have recently enacted bills for the decentralisation of authority from central to local governments (Vietnam in 1996, Thailand in 2000, and Indonesia in 2001). These new systems include the potential of community participation in decision-making about the allocation of land and resources, but also the reality of land allocation through the private channels of corporations and governments necessarily seeking greater revenue. For the border areas, which are primarily upland-agricultural, the loss of land to privatisation has meant, again, the search for jobs in trade and transport, as lowland paddy areas are also unavailable.

  • 20 See Alan Smith for a discussion of the land area and food volume required to prevent starvation in (...)

14In the case of the land reforms that accompanied development and the New Economic Mechanism (the “New Thinking”) of privatisation in Laos, we actually see an increasing loss of access to land and its economic potential by the rural poor, for several reasons. The central importance of well-cared-for land, and, further, of zones and territories that are accessible to all for production and legitimate trade, to sustainable rural economies is undoubted. To come to the point, there is one common defining factor in absolute poverty in Asia, the poverty that now drives illegal migration and trafficking. That factor is the unavailability of land. Without land, the moneyless, uneducated rural poor have no means of subsistence. Tenant farming on another’s land is subject to the variations of season, export market prices, and labour competition, of course. Rather than affording a means of earning income and some amount of food, tenant farming often leaves the household with less than the minimum amount of food required for health.20 As a consequence, not only do the impacted persons become illegal migrants, they engage in employment that requires them to transport illegal and informal goods, and their households also become the willing purchasers of such goods. It was striking that of the rural people interviewed in this survey, the majority were or had recently become landless or were failing to subsist on the small remaining amount of land to which they still had access.

15As shown next page, there are differences not only in the use of land—agricultural and environmental economists have already taught us quite a few things about that—but also in its definition and its value between the two different paradigms. As mentioned above, all of the GMS countries now have land laws that establish land boundaries, private land ownership, and rules for the administration and / or transfer of land. To repeat, relatively new legal systems hold the potential of community participation in decision-making about the allocation of land and resources, but also the reality of land allocation through the private channels of corporations and governments necessarily seeking greater revenue. Ultimately, no amount of decentralisation changes the fact that in the GMS countries the national governments control fiscal policy, the use and distribution of overseas financial transactions, and tax, property, and investment regulations, including regulations involving natural resources.

Land in an Unsustainable Development Paradigm

Land in a Sustainable Paradigm

“Global” world


Real estate, property, estate


Private vs. public use legally determined

Non-private; community use




Ground cover


Community farms and forests

Roads and other infrastructure

Cultivable / fallow land alternation area

Surface: country, territory, geography

Surface products and lives

Camps: work, prison, military, refugee, displaced

Living clusters (villages, townships)


Space of worship, burial, ritual, festival

Useless land: contaminated, desertified, submerged

Useless land: submerged, receded, frozen, scorched, steep

Nation-state border impeding trade

Porous border enabling trade

16There is thus an impaired resource access in the globalised and regionalised economies of the GMS. The long-term consequences, however, are not only legal, but also quite tangible in terms of health and the natural environment. We have long seen the not only beneficial, but also deleterious effects of unsustainable development schemes that manipulate ecosystems to increase economic profitability. Current cross-border development schemes in the Upper GMS have brought about deforestation, food export, and changes or diversion of water supply, phenomena that reciprocally affect, and worsen, each other. More specifically, as this research shows, the push towards much larger-scale cash cropping on what are now privately-owned plantations has encouraged the use of agricultural chemicals brought, in some cases, illegally from the border or containing ingredients that adversely affect the environment and public health, also a crime under Lao law. In the Asian region, many examples of ecological disasters have, in recent years, been linked to development and entrepreneurial schemes that led to environmental mismanagement through the use of substandard, toxic, or illegal products. Further, although developed countries’ food supplies are also affected by such mismanagement and use of hazardous inputs, it is the food producers in rural, developing regions that are in closest contact with the consequences of deforestation, drought, chemical toxicity, and food shortages, leading to a vicious cycle of further poverty and further incentive to engage in illegal cross-border activity.

17Ironically, it is the national policies of these countries, including policies for open markets, and the loopholes, or corruption in laws, rather than the laws themselves, that are now the basis of limiting or denying access to land, food production, and income, as well as of hamstringing the local governments’ budgetary resources. Recent attempts to impose modern, democratic policies on traditional areas did not first consider ways to modify the burden the new policies would automatically place on the impoverished local district, its untrained, underpaid staff, and the local population, who may be unaccustomed to open or non-mercenary discussions with persons in positions of authority. In reality, the “policies” that are most closely involved with the loss of rural sustainability that drives trafficking are not only policies at the national and international level. Few of the populations of developing countries are directly impacted by the establishment of national institutions and policies. To border dwellers, remote both from the benefits and burdens created by the central government, national policy is almost totally unfamiliar. It is the cross-border employers and contractors who make the “policies” or rules that most deeply impact the lives of local people. The employer, whether the seasonally-hiring landowner, the border factory or mill owner, the contractor who needs carriers to transport goods, or the ‘broker’ who takes day labourers to domestic or cross-border work sites, will decide if, when, what and how that person eats. Illegal trafficking is thus not simply a question of either national policy or individual choice. It is more likely to be the result of a lack of choice.

18As mentioned earlier, a further consideration is that the border areas of the GMS have traditionally been framed, in academic, financial, and legal terms, as chiefly the residence of upland minorities or Montagnards. This deeply affects the political and economic realities of border trade today. For answers to the question of why, we ought first to look at when Montagnards became of interest to governments and the private sector. Montagnard minorities first began to be of interest to the governments and businesses of this region at a time of transition, that is, when the tributary areas mentioned earlier, consisting of what is now central, southern, and northeastern Thailand and northwestern Laos, Shan State, and Xishuangbanna, were under various internal and external pressures. These areas were to become or be absorbed into the nation-states of Thailand, Myanmar, Laos, and the People’s Republic of China, as we have seen. As soon as the northern GMS became a part of political and economic nation-states—just prior to and after World War II—internal and external actors interested in the region’s political and economic future seemed to “discover” the ethnic minorities, who were sitting on the kinds of resources that modern nations wish to extract.

19Moreover, governments wished to gain the allegiance of the border minorities, whether by force or incentive, and thus, similar to the border-crossers of today, create access to various other places and resources of the mainland through Montagnard territories. These actors were a fairly diverse lot, including the Thai government, the wartime Japanese military, European and North American missionaries and traders, and various logging concessions belonging to all of these. It was but a step from there to the postwar regional governments’ economic planning initiatives to include Montagnards, and soon to more serious interventions by the U.S. military seeking assistance from among the minorities for its various initiatives against the Viet Cong, the Pathet Lao, and against a presumed general threat of the spread of Communism. Accompanying these more single-minded or self-serving interventions were attempts by Christian missions, charitable foundations, and the United Nations to provide education, maternal and child health care, and other basic needs to the northern minorities.

20Above all, the northern border minorities and the northern majority Lao have been seen, and often see themselves, as lacking to some degree in basic survival resources. Their national governments, however, along with cross-border investors, believe them to be on land that offers quite rich resources indeed. The see-sawing of policies, programmes, and projects undertaken to compromise between, and achieve support from, the different sides and their adherents has necessitated a dazzling display of flexibility on the part of national governments, public and private sector businesses, researchers, and border officials, in order to answer the following question: should we see these border dwellers as the active and knowledgeable possessors of natural resources, mobile labour power, and illegal goods; or, rather, as pawns in the national and intergovernmental competition for such resources and manpower? Or is the reality less clear-cut than these two?

3 - Discussion of Findings: Specialists versus Practitioners

21After entering Thailand from Laos, the author spent several days with key informants researching at academic institutions and international NGOs. Interviews proceeded mainly with the introduction of key questions or themes, followed by at least one hour of discussion per person. Interviewees had high-level expertise and on-site experience on border movements and trade, ethnicity, environmental damage from trafficked goods, and health impacts from substandard or hazardous goods.

22In a discussion with two researchers from Chiang Mai University’s Faculty of Social Sciences, the phenomenon that would provide the next stage of research was discussed. This is the fact that the current cross-border migrants, especially those to Thailand, have in some cases stayed long enough to bring their children or to have children in Thailand, thus making the second generation a new target of policy and research. The second-generation border migrants maintain some ties with relatives in their parents’ country of origin and at times carry, or traffic, what they perceive as needed goods between the two countries. The present researcher has also, in the past, interviewed second-generation individuals whose nationality, due to migration and legal application for national registration, is in three countries (China, Myanmar, and Thailand), and who traffic goods, people, and livestock by vehicle across the border. The possession of three legal identification cards and three legal names, one for each country, makes passage through customs easy and passage through extra-legal border areas easy as well. Migrants whose parents were born in China, migrated to Myanmar, and from Myanmar into Thailand or Laos represent a growing number of individuals, and their economic activities in the region provide material for further research.

23The author also met with a researcher on migration and ethnic issues in the GMS. From the discussion emerged recognition of the need for research and publication on the modern history of border ethnic groups, in particular the Kachin and Shan, and their movement and trade practises in Myanmar and Thailand. Both ethnic groups have been discursively represented in unhelpful or stereotypical terms. Rather, the recent drivers of new kinds of cross-border activities and their background in previous events and issues need study. It would be more helpful for the foreseeable future to look at the diversity of economic levels, livelihoods, education, languages, and domestic political experiences among the Kachin and Shan, the two largest border ethnic groups in Myanmar, totalling over 10 million individuals. Further, the diversity of sub-groups within the Shan, for example, who were the focus of the present research in Myanmar, makes it impossible to generalise about their preferred border movements and the trade activities they would engage in if they crossed the border to Thailand.

24A meeting with a researcher at an international environmental institute enabled a lengthy discussion about both the causes and the impacts of recent movement and goods trafficking on the movers and consumers themselves as well as on the environment. Illegal and informal trafficking of hazardous goods affects not only the unknown, distant consumers and their country’s environment. It also affects the person who transports the goods, or who moves illegally, who is almost certainly one of the sellers of the hazardous items and who may very well be one of the consumers. The researcher confirmed that the health and environmental impacts of hazardous goods had already become visible in areas of Northeast Thailand and Cambodia many years ago, which had converted to chemical agriculture much longer ago than northern Laos or Myanmar, and which have had a thriving border trade in hazardous goods with other GMS countries for an equally long time.

4 - Indications from the Main Survey

25The survey done in Laos was the focus of the research on illegal and informal trade in the Upper GMS. It involved more analytical techniques both for the environmental chemical sampling and for the ethnographic and qualitative interviews with traders and consumers. It attempted to clarify the ways in which the four features below have changed the socio-economic patterns of northern Laos and contributed to the greater trade in informal and illegal substances.

  1. There are geographical and geophysical changes affecting the border areas and their land use and transport patterns.
  2. The status of road construction of Highway No. 3, still in progress, and its associated infrastructures of electric wiring, grading, and roadside drainage, greatly affect land use patterns.
  3. The status and growth of local markets is rapidly changing, both in the concrete sense of traditional outdoor markets in the rural areas and street markets in urban areas.
  4. Lengthy discussions with rural and urban informants in the Upper GMS brought out the changing patterns of trade, the influence of private-sector outsider involvement in the region, changes in land use, and changes in local production, marketing, consumption, and expenditure.

26In terms of alerting potential users to harm, and eventually pushing border policy reform, local health care systems can play a role if properly supported. In Laos a health care system similar to those of rural Thailand and Myanmar exists, with the most local or smallest unit being the rural health stations located in villages. Training to update the knowledge held by health station workers is regularly provided but their mandate is to serve basic health needs such as common illness and injury. Further, as with the lack of facilities at Customs check-points, the expense and equipment that would be needed to assess environmental and health impacts cannot be provided at the local level. The current problems are, thus, fourfold:

  1. lack of agreed standards on a multi-lateral, cross-border basis for the environmental and health safety of imported goods (overland);
  2. lack of facilities at border check-points and smaller customs offices to inspect or analyse all goods;
  3. lack of knowledge or awareness at the local level about chemicals, and chemical health impacts under widespread and constant use;
  4. lack of facilities to inspect or analyse chemicals themselves (at Customs), and to examine or analyse human health at local and rural health stations.

27The focus of the present research was not only on what items are illegally or informally traded across the border, but also on why they are illegal: what kinds of hazards they present and what kinds of damage they can do to health and the environment. Here it bears emphasising that agricultural chemicals, unlike individually bought and used illegal goods (examples would be narcotics or counterfeit household products), do not adversely affect only the individual user. Precisely because they are agricultural chemicals, they impact the entire population and environment in the areas where they are used. Further, through run-off into water and irrigation supplies, they also impact populations and environments at greater distances.

28For all the countries involved in the border trade of the Golden Quadrangle, there are environmental protection laws as well as commerce laws and public health laws that impinge on the trade discussed here. Partially because of the distribution of jurisdiction and policies among several different ministries in different countries, the responsibility to provide a standard, as well as to inspect goods and analyse their contents, is not clearly defined as the responsibility of one agency. Coordinating among different agencies and countries is enormously difficult. In Laos, the most recent laws to protect the environment, as well as laws prohibiting certain articles from trade, are enacted and implemented at the national level. The inspection of domestic production and goods is much easier to accomplish in Vientiane, the capital, where facilities and staff are chiefly located, than it is in the northern provinces surveyed here, which are over seven hundred kilometres away by roads through the mountainous interior that are in poor condition. If a customs officer or agricultural extension officer in northern Laos finds goods suspected of being illegal or of posing a health or environmental threat, the goods must be transported to Vientiane and tested at great expense there, and the result awaited. This time-and resource-consuming process is thus seldom undertaken unless the goods in question are known to pose a threat of severe harm or illegality.

29This returns us to the thorny issue of illegality versus harm. Under the modern legal frameworks adopted by the GMS countries, these two should converge. Actions and goods are illegal because they cause harm or threaten the security of the population. This policy stance, if implemented, would seem simple enough. It leaves only two basic questions. The first is one of how to determine “harm”, and the second is one of how the harm is to be prevented or avoided. It is the first question here that, however, opens the way for further difficulties and questions, as will be discussed in the concluding section.

30As stated above, the different nations and different agencies within nations do not have an agreed standard or definition of harm. First, they do not have a full list or compilation of the hazardous materials that currently exist. In some cases, the novelty of certain chemicals or their combinations makes them little-known to both policymakers themselves as well as to those who produce, or scientifically understand these chemicals. For example, in advanced countries there are various synthetic chemicals whose use is thought to contribute to birth defects, cancer, and other illnesses as well as to environmental degradation, but they are subject to argument. Second, with the consumption, effluents, or by-products of chemicals, the amount, period, and means of use or consumption that would cause harm is still a subject of debate in both advanced and developing countries.

31A seemingly minor, yet far-reaching, example of the above dilemmas was mentioned in Laos both by agricultural experts and by knowledgeable farmers themselves. In the case of domestically produced and tested chemicals, the amounts to be used, periods of time to use and area over which the chemical should be diffused (rather than concentrated) are given in specific instructions on their containers, and told to users by agricultural extension workers, contract-farming company representatives, and in some cases by the staff of agricultural shops. Farmers may choose to ignore such indications, or, if they are low-educated rural or minority farmers, may not understand them, but the protocol of harm reduction is being followed and implemented as well as can be. In the case of imported chemicals, however, the labelling on the containers is usually in the language of origin, and agricultural officers and local users can neither read it nor instruct others on appropriate use. For most chemicals and brands surveyed by the present research team there were no instructions for use at all. Further, some containers did list the putative ingredients, again in the language of origin, but some did not specify the ingredients at all, or did not specify the amounts or percentages that constituted the whole. What were the ingredients, were they what they claimed to be, or in what percentages did they constitute the packaged chemical mix? These questions could most reliably be answered by submitting them to a chemical analysis. This, however, due to cost, time, and distance, was impossible.

32If the chemicals or other hazardous and suspicious substances could be analysed in representative quantities, the next step would be to notify the users as to what amounts, and over what period of time and what area of dispersion or parts per million they should be used. Though many of the chemical ingredients used, by themselves, have known risks and limits of human exposure, the final, composite chemical mix may have different effects. Also, as mentioned above, in substandard or hazardous chemicals there is a high probability of mixing with unknown, or unlisted, ingredients.

33What is needed, now, is a policy that not only takes into account previous issues and problems that arose in nearby countries—the so-called “bad development” schemes that have already damaged the rural environment and adversely affected some of its people—but post-policy measures that can also regulate the actions of the private sector’s manufactured products and their inspection, transport, and sale. This would necessarily have to include multi-lateral standards. The nations in the overland trade regions of East and Southeast Asia need to agree on chemical, pharmaceutical, and environmental standards, either within the proposed ASEAN framework or others. Further, and more practically, nations need to identify the means of proper inspection, and of instructing users on the safer use of potentially harmful goods.

34To frame these provisional conclusions, we could benefit from a practical application of Saskia Sassen’s arguments on the role of the nation-state (as regulator, and presumably protector, of its citizens’ security) having been superseded by that of the transnational corporation, which now owns or leases vast tracts of land and regulates most of the waking hours of its thousands of employees, and their households, in the GMS. But a focus purely on large transnationals would ignore the actual functioning, and means, of economic transactions in the Asian micro-economies of the border regions. It is not the transnationals but their local sub-contractors in Yunnan and Guangxi, which border on the GMS, and even their suppliers from their own neighbouring provinces of Hunan, Szechuan, and Guangdong, that must calculate, with their extremely limited resources, what sorts of raw materials can be bought, how they can most cheaply be assembled, and how they can most cheaply be packaged, transported, and sold.

35These, along with their local goods transporters, markets, and consumers, are the actors in the Asian micro-economy at the beginning of the 21st century. Their concerns, and therefore the drivers of their behaviour, are, first, the ongoing economic condition of being resource-poor and cash-poor, a condition that, due to wide domestic economic disparities between provinces and continuing, or widening, income inequality, continues despite aggregate statistics of (presumably urban) yearly rises in economic growth. In fact, the high economic growth rate achieved by China has been at the expense of wages for the low-end workers in these subcontracted businesses; high employment and land loss driving the poor of the provinces mentioned above to transact business across the borders of Myanmar and Laos; and the cheap and hazardous materials used in the manufacturing processes of the trafficked goods. The second and more recent driver is, of course, the global financial crisis that began in 2008. The GMS countries are still far behind even Japan, which shows dismal employment and other rates, in “recovering” and cannot be said to have begun recovery. Rather, tens of millions of formerly employed persons and internal migrants from rural areas have become destitute and jobless once again. This salient fact does not allow subcontractors, their workers, their transporters, or their marketers to undertake safer, environmentally more sound production practises for their goods. Rather, it is a further and unavoidable incentive to produce more goods more cheaply, to keep even below-minimum-wage employment and sales. On the receiving end of the goods, the consumers, who are the tenant farmers or smallholders whose productivity absolutely determines their (meagre) income or lack thereof, choose the short-term, hazardous path of consuming the cheap and more toxic chemicals in order to achieve seasonal production that will at least allow survival for the time being, rather than the safer, domestically-produced and inspected, but three times more expensive chemical inputs.

36The modernisation and development of economies, production practises, and labour is in large part about spatialization, the re-allocation and re-conceptualisation of space, including border spaces. The determination of national borders, and thereby of the regulation of the flows of goods and people between two or more newly divided economic spaces, has everything to do with the valuation of land area, its allocation, and its re-allocation. In rural regions of developing countries, it also has to do with the “disappearance” of land as an area for traditional economic activity. Border land in this sense is disappearing through its appropriation, by governments and the private sector, for non-subsistence purposes, resulting in its inviability to local rural economies.

37The kinds of development that have recently affected the Upper GMS borders—export agriculture and construction of infrastructure—have promised employment, cash income, and a higher standard of living to the affected rural areas. Problems, however, arise along with these potentials. The kinds of employment offered by construction, or by tenant farming on large plantations, or by transportation of informally and illegally traded goods, for example, are available to precisely the destitute and unskilled rural people who have already lost most or all of their land. Yet these kinds of employment and projects exist precisely because their land has been re-allocated away from its rural users. Building construction, plantations, and public works in Southeast Asia depend on the purchase of or right to use what was previously local food-producing and income-producing land. Road construction depends on procuring rural land for roads, and trucking and transportation depend on the roads and railways that have been built on such previously productive land. But because these kinds of employment also carry the greatest risks and harm, including the exposure of humans and the natural environment to toxic agricultural chemicals, the risk that such new labour will incur greater health costs, morbidity, and land degradation is high, meaning that economic development will not be enhanced in the region.

38Like other areas of land, border land is valued differently by different stakeholders. The new (since the colonial period) territorial boundaries of what became Myanmar, Laos, and Thailand—areas that were previously galaxies of related or nested kingdoms—establish not only political, but economic values. It would be tempting even to say that more than political boundaries, they are economic boundaries: between richer and poorer, between industrialised and agricultural, or even between urbanised and still rural. These border dichotomies have a certain validity for the following argument. As we will see below, however, they are not always valid in terms of the realities of rural areas at the borders.

39The border territories as a space for economic transactions embracing restrictions—it is a quicker and less restrictive process to transit as a “wealthier” person from the “wealthier” space to the “poorer” space—and also embracing dynamism—even wealthy enterprises cannot survive without low-wage and low-skill workers who transit the border illegally—currently have the meaning of territory, geography, or surface that makes movement and transport possible. Upon closer examination of this meaning and function, however, we find a strange paradox in the national and local governments’ treatment of such spaces: they are both public and private. The meanings of “public” and “private” in traditional and non-Western societies of course differ from those brought in by Western modernisation, a difference which is beyond the scope of this study to analyse in detail. For the purposes of this research it suffices to say that the conceptions and economic uses of the border are both public and private at the same time and in the same space. The modern nation-states of China, Myanmar, and Laos established their current boundaries—and continue to establish them—on the basis of modern cadastral mapping technologies and Western requests to make clear whose obligation it was to supervise which territory up to which razor-thin line. The present-day Customs checkpoints and associated national government mechanisms by which the borders are patrolled and economically and geographically regulated are similarly modern and universal, and the economic benefits brought in by border tariffs are meant to be collected and re-distributed at the national level. In this sense these trading spaces may be called “public”. As public, that is, governmentally maintained and regulated, spaces, however, they are also subject to contestation based on the degree of economic benefit seen to accrue to either side of the border, and multilateral negotiations as to the legality and illegality of the movement of goods and persons.

40The privatisation of the border territories, however, very nearly overlaps with the public spaces and functions outlined above. Private enterprise in China, Myanmar, and Thailand depends on the border territories of these three countries as well as of Laos to maintain and provide not only natural resources and agricultural and raw materials, but also the cheapest possible labour and transport power not only for the large-scale trade that is undertaken by registered enterprises, but for the petty trade and transport, including illegal trade, that these enterprises employ through massive outsourcing in order to lower their costs. National governments themselves participate in this privatising activity, by encouraging greater trade and transport for business and by marking off, or enclosing, sections of border territory that are off-limits to the public and the general population. In the borders of the Upper GMS, land and border surveys and re-allocations have been fraught with legal loopholes and extra-legal exceptions allowing private entities or public-private enterprises to appropriate large tracts of land.

41Here the root of the public-private paradox and its contradiction of the traditional, and sustained, notion of public and private emerge. Is “public” to mean a space that is free and open to all regardless of social or economic class, a space where participation can also be freely allowed? If so, then the traditional mandala-style border domain fits this definition most closely, with local persons of all occupations, classes, and ethnicities transiting a buffer zone-style area where exact borders among languages, communities, and loyalties are multiple or fuzzy. If, however, “public” is to mean regulated by a distant, centralised government that initiates, controls, and absorbs the economic benefits of the border domain while strictly marking off a line between “ours” and “theirs”, then this definition is not in accordance with either traditional or current livelihood and social networks of movement. It is, rather, more in line with the modern notion of “private”. Indeed the borderline itself can be seen as a marker of privatisation; each nation on either side has whole, or private rather than joint, ownership of the territory in its side. What the trade and transport under discussion here entail, however, is a use and valuation of territory as a rooted space that despite (or due to) its historical and geographical fixity makes possible a dynamic of access to shifting potentials for livelihood. It is also literally the ground from which all traded products, legal or illegal, are seen to emerge. As such the border territory is in reality, as described above, a commons.

42The border areas upon which both modern and traditional practises are contested are the national territories on all sides of the border, in the sense of being subject to the laws of individual nations. The real and physical areas on which they operate, however, are the spaces for livelihood and trade by the rural communities in developing regions. Recent land grabs and land transfers in the border regions have actually succeeded in further isolating, and pauperising, the land-poor among this rural population, giving them another incentive to engage in whatever sort of trade is possible. Local land reforms continue to be implemented in both Laos and China on both sides of the border. Yet such policy reforms, however well-intentioned, can generate a class of the disenfranchised or disempowered, those who are not helped but harmed by the reforms. When land rights are reformed or land is redistributed, either through development or through boundary determinations and controls, those who have lost land in the process will attempt to seek a space to live and a space to work outside of their lost land. In this new process of their displacement, as the UN’s Human Development Index makes clear, migration and poverty, low education, and disparities in education and skills are linked with each other and with human security concerns. Finally, under modernisation, the combined household expenses for sending children to school, accessing transportation, and accessing childbirth and health care facilities, all which have now become “basic needs”, are still well beyond the daily or monthly wage of rural earners. The loss of assets and resources through development projects, including those previously provided by lost land, and subsequent unmet costs on the household level, and their subsequent burden on the village community, are seldom examined. If they were, they could be included into community and national development planning.

43This situation is, in brief, the one that is currently affecting the rural northern population of Laos. Thus “migration” in the sense of constant and short-distance transiting of the border, as well as transport of goods during such transits, has become extremely common and now provides a major source of livelihood. They are now more dependent on those who can offer them some degree of security through employment. This dependency creates a core of human insecurity and drives repeated and upward-spiralling involvement in illegal trade. It is now clearly manifested in the continuing or worsening poverty, food insecurity, and political and social disempowerment of rural Southeast Asia.

44With limited or no access to productive land, households in the rural GMS, although situated in food-producing regions, have begun to face food insecurity and income insecurity. At the lowest level, labour migration patterns in impoverished rural communities stem from these new kinds of human insecurity. This includes loss of land through sale to gain cash income, and government re-allocation of land to investors and industries. The agricultural sector of the mainland Southeast Asian economy is an agricultural surplus and export economy. National governments in the region have, since the 1950s, pushed rural communities to undertake food production for export along with or even in place of household food subsistence. This export-oriented development policy can earn foreign currency for those in the businesses of food processing and procurement. But it also brings about negative impacts on the agricultural community in terms of loss of productive land for self and household consumption. The land is lost to plantations and agribusinesses that promote monoculture rather than food, further contributing to occasional or chronic food insecurity in rural areas. Accompanying agricultural development of this kind is infrastructure development. This involves, as we have seen, public construction of roads, buildings, and other facilities. Although these types of short-term projects can offer temporary employment and income to the rural poor, they also make unavailable, normally without the consent of those affected, huge tracts of land that had formerly been used for sustainable agricultural employment and food production. Other policies for public works, notably dam construction and industrial parks, are implemented by governments in conjunction with domestic and foreign concerns and banks but without accurate assessments of the economic impact on rural communities. Further, where a large proportion of a population is under-educated, as in northern Laos, trans-border movement and trade transport, which are readily available as unskilled and seasonal labour becomes in practise the only choice for wage income. Further, the poorer the workers—both in terms of land and in terms of educational attainment—the greater are their chances of being exposed to highly risky environmental and health threats that result from the hazardous nature of the cheaply produced trans-border goods that are bought, transported, sold and used in the rural GMS.

45Tenant farming on another’s land is subject to the variations of season, export market prices, and labour competition, of course. Rather than affording a means of earning income and some amount of food, tenant farming often leaves the household with less than the minimum amount of food required for health. In this way, the production on Lao soil of agricultural and timber products for re-export to neighbouring countries has itself been one of the drivers of greater engagement in cross-border illegal trade. Lao nationals themselves can now, by making use of the transport routes and vehicles offered by neighbours, more easily transport both legally registered goods and unregistered or illegal goods.

46Saskia Sassen, in her introduction to Global Networks, Linked Cities, describes “the intensifying circulation of goods, information, firms and workers” not just globally but within what she calls “strategic sites”, or grids around cities that now take on the economic activity that urban downtowns used to generate. Viewed on the smaller scale of developing rural areas in Asia, what Sassen perceives also applies to the economic nodes in the border areas of Thailand, Laos, Myanmar, and China. Economic regionalisation in the Upper GMS has not been a matter only of geographical extent, but of greater speed of movements, transactions, and of emerging consequences and impacts on border dwellers here. The faster circulation (higher demand for and turnover) of workers within the newly-forming “grid” areas extending from Jinghong to Mohan in China, and across to Boten, Luang Nam Tha, and Muang Sing in Laos, rapidly draws in populations from farm and mountain villages. Even the provincial highway going to Muang Sing has allowed increasing economic activity and resulted in the building of larger exurban market centres, along with taking over the exurban agricultural land. The population of Muang Sing alone has nearly tripled since the road system (Route 17) was completed. These populations are increasingly drawn into the business of informal transport and trade among these networked nodes, which are distributed regionally across borders rather than within the domestic economy. Since the late 1990s, various development policies have been implemented by the national and local governments and by government-private sector partnerships to promote such building of infrastructure, small industries, and transport facilities. Since that period, these projects have gradually deprived local users of land or degraded the land to the point where it became unproductive. A larger proportion than before of the present-day residents of the outlying areas of these nodes are now land-poor, and are relying on irregular day labour, loans of money from neighbours, and engagement in informal and illegal trade in order to fulfil their most basic needs.

47Yet when we talk about the regionalisation, rather than nationalisation, of spaces through which goods and people move, is it appropriate to define them in terms of these regions, as though there were geographical and spatial conditions to human livelihoods? “Regions” are used metaphorically to refer to the populations residing in them, who are apparently responsible for the level of economic development or sufficiency that they are presumed to have. If the level is low, the citizens and residents as well as policymakers in those regions are designated to receive development assistance and projects from more advanced economies, projects that will use some amount of the land and its resources in new ways. As such, a region is also a territory, a country, or a local community, and in this way, “regions” are also indeed used as spatial terms to designate the location of those natural resources that are currently needed by developed and developing countries. In all cases, a region is land, the basis for all natural as well as technological resources and production.

48What this author has called elsewhere “land poverty”—the lack of sufficient access to land to produce twelve months’ of food per household, in an economy where other forms of access to food are difficult—emerged from this study as one of the most basic and universal causes of both long-and short-distance mobility and trade. Mobility to seek work is well-known; mobility to seek goods and markets is less well-researched but nevertheless highly visible in the micro-economy of the GMS. In recent years northern Laos has seen developmentally-induced climate change of the kind that destroys access to land and local livelihoods. What was until recently the cool or cold north is now the warm or hot north. Periods of drought and hunger have increased. These droughts and famines are due in large part to national and global policies that had emphasised one sort of development policy, the kind that strips land and basic resources without replacing them. It is the attempt to replace these resources, or their value in kind or money, that leads border dwellers to engage in informal trade in ever-increasing numbers.

49In the Southeast Asian region, and now particularly in the lower-developed CLM countries (Cambodia, Laos, and Myanmar), there have been many ecological disasters resulting from development policies that led to environmental mismanagement. The disappearance of land that accompanies all development projects means the disappearance of livelihoods and the basic needs that they supply, thus driving the need to find other livelihoods within the region. Food producers in rural, developing regions are those that are in closest contact with the consequences of development and investment that require deforestation, land transfer, or water diversion, causing drought and food shortages. It is thus the food producers’ own local food supply that is most directly impacted and which they must try to retrieve through the new economy of cheap trade. The primary cycle in this process is one in which lack of access to land pushes mobility to seek labour, income, and goods; this mobility in turn provides access to hazardous and illegal goods that cause ill health and environmental degradation; and health problems and environmental degradation in turn cause greater poverty.

50This absolute dependence on land of a certain amount and of a certain level of fertility very directly pushes engagement in illegal and informal trade when land is diverted to other uses. There is first of all a time gap in the loss of land to highway-building and the benefits that such a highway may bring to local residents (rather than larger-scale producers or shippers), a gap that can last a whole generation or more. There is also a new inequality in the potential offered by the new infrastructure or new production for trade: those who have the skill to take advantage of the higher levels of such employment will rise much higher than those who do not; most will fill the low-skilled, low-wage, irregular-income demands of mass production in both senses of the term: production directly from nature, and production through secondary-sector manufacturing, finishing, or processing.

51A fuller discussion of the four areas which framed the Laos survey, and based on the subsequent interviews and sampling in Laos, follows.

A - Geographical and geophysical changes affecting the border areas and their land use and transport patterns

52This is mainly the continuing construction, and final completion in late 2009, of Asian Highway No. 3 from Jinghong in China to Highway 3E within Laos. The Lao portion of this highway proceeds from Boten at the northeastern edge of Luang Nam Tha Province to Houay Xai at the western edge of Bokeo Province, where it meets the Mekong River border with Thailand’s Chiang Khong. The observations from the road and its catchment area are as follows.

  • 21 Pittaya Fhusai, ed., ch. 3 passim.

53The construction of Asian Highway No. 3 began in 200621 and was completed in late 2009. During the two surveys for the present research, the Lao portion of the highway was partially completed; its relation to cross-border overland trade is as follows. According to a local official, the route from Boten to Houay Xai—which follows, and mostly overlays, the ancient route taken by Chinese traders from Yunnan—used to take at least three days in the past, after the construction by the Lao government of a one-lane road that was surfaced in some of the low-lying areas.

54Interestingly, prior to this era, trade by way of mule and horse caravan over unpaved mountain tracks would have taken a much longer time, and yet it evidenced much of the same fuzzy-border, trans-“national”, and informal or illegal activities that have now returned with a vengeance. There followed the era of colonial occupation, the war of independence, and then the American war on Vietnam. All of these not only necessitated road transport, for the use of armies and materiel on all sides, but also constituted the means of regional, border-ignoring trade for the colonially, and subsequently militarily, occupied north of Laos.

55In the transition period between the Lao road and the Chinese-financed and built Asian Highway No. 3, in March 2009, transport by means of the highway would have taken one entire day. The second survey, undertaken in early September 2009, found that nearly the entire highway, except for one stretch taking about thirty minutes by car in a steeply mountainous area on the border of Luang Nam Tha and Bokeo Provinces, was by that time paved. Given that this was during the rainy season, whereas the March 2009 survey took place during the dry season, one might have expected that the March road conditions and time of travel would be shorter. However, the grading and paving of the road through modern Chinese engineering technology has made far more of a difference than the seasonal conditions of the road. In September the road from Boten to Luang Nam Tha took slightly less than two hours, and from Luang Nam Tha to the Thai border at Houay Xai exactly 3.5 hours, including the time spent navigating a sub-surfaced but not-yet-paved section. Thus the present research was able to confirm the local Lao official’s statement that what once took three days now can be accomplished in five hours.

56The effect on cross-border trade has been spectacular. Where once mule caravans brought everything, from housewares and other secondary-sector manufactured goods to Chinese medicines and tea, now such things are moved by modern truckers. In other words, although some of the ingredients have been updated and re-formulated, neither the basic product lines nor the consumer needs seem to have changed all that much. The processes and procedures of this trade, however, have altered in accordance with the modern and transnational infrastructures in the ways described below. More importantly, however, the official business of economic border crossing regulation and its impact on (the loss of) livelihood of border dwellers has caused exponential growth in the sheer numbers of people and goods crossing on a daily basis since the end of the Asian financial crisis of 1997. With the added financial (dis) incentive of the global recession that began in 2008, access to the border as an economic commons has become not merely a specialty of traders, foresters, and fugitives, but an economic necessity of the common people.

57The road construction itself, taking over three years to complete, has affected an enormous variety of local livelihoods and their supporting ecosystems, and thus brought a large number of border dwellers into the cross-border trade both as trader-transporters and as consumers. Large-scale highway construction, like large-scale dam construction, involves a fairly wide catchment area and the associated deforestation (“clearing”), re-grading or even dynamiting of sloping areas, and diversion, stoppage, or draining of natural sources of water. Further, not only the road area itself, but the roadside swales (side drainage areas) and borders must be levelled and artificially reinforced and protected from encroachment, meaning that the total area of land lost to agriculture or forestry is also large. Finally, the Chinese ODA that built Asian Highway No. 3 has also provided access to electricity, as well as to petrol filling stations, along the highway in Laos in order to enable its builders and truckers to use the road to transport infrastructure-building materials. These sorts of construction do change land use and its associated access to livelihood. Further, they cause local dwellers to incur more expenses that they may not be able to meet. New expenses that accompany cash economies and modern infrastructure, such as access to water lines, gas, electricity, and property taxes, require substantial outlay. These expenditures must be paid for by the adult household members who previously subsisted without a budget for these current services, and who did not, in the past, acquire the education or skills to allow them enough earning potential. All of these factors make it far more likely that local agriculturalists will wish, or need, to engage in cross-border trade as an alternative. Finally, the sheer increase in volume of daily trucking and transport across the border has been exponential, as might be expected. Moreover, of particular significance to this study is the increase in individual and household treks back and forth to carry various goods. The new, as well as the recently improved, roads can function as open, legal, and convenient transport routes for individuals and households. For a large volume of the informal and illegal trade, however, public roads function as the opposite of this—enhancers of, and distractors from, the use of older, and in some cases better-concealed, routes taken since the pre-national-border era.

58There is no question that in terms of border trade, the new roads are better for some kinds of traders than for others, and better for some kinds of trade than for others. A case in point is the Lao border with China in the district of Muang Sing. This border has a single-lane road into the Chinese side with a small Customs house in a wooded, hilly area whose residents are rural Lao and Montagnard ethnic minorities involved in household forestry. During two surveys (March and September 2009), the present research was able to observe and record the border crossing for over an hour each time. All of the crossings involved the transport, whether by small pick-up truck or by personal portage (hand carrying), of raw materials or basic goods from one side of the border to the other, and none were stopped by or subject to inspection by Customs. The small pick-up trucks were used by rural Lao households, usually extended families, to purchase in China what they now see as their necessities for the week and bring them back. These included not only very cheap household goods such as soaps, toiletries, small implements, clothing, and plastics, but also prepared and packaged foods and cooking ingredients, and of course the agricultural chemicals whose content is unknown to their purchasers. Although Laos is a food-producing country, the increased necessity of buying food rather than producing it for self-consumption has been noted by several researchers (see Yokoyama et al.; Phanvilay et al.). There is also a corresponding necessity to buy other goods that were, in the past, self-produced, seen as unnecessary, or simply unknown or unavailable. The present adults in the Lao border districts grew up when the sources of energy for fuel, including cooking, consisted of locally gathered firewood, and when the channel of communications was the human network of the village and the market town. Now copper wire and lithium batteries, for example, both produced outside of Laos, provide people in the area access to energy in the form of electricity and to communications in the form of telephone service and radio.

59As has been noted elsewhere, the conversion to dependence on such market products rather than self-produced or self-managed ones from farm and forest is due in part to the loss of access to land that occurs with economic development, including the loss of land and groundwater due to road construction. The result, in areas like northern Laos where other domestic sources of food and their markets are nearly inaccessible, is the personal and household transport and consumption of goods of dubious legality from beyond the border. It is probably not a good idea to frame this in terms of a set of choices. Simply, less land means less food, which means trying to access food from the closest source—in this case a nearby, informal market in another country. This goes for the other cross-border items as well: the plastics, toiletries, cooking and farm implements, and clothing.

  • 22 See also Danielle Tan, Du Triangle d’or au Quadrangle économique, for a discussion of other forms (...)

60If the trade in illegal and informal goods is to be thoroughly understood as a highly mobile activity within this region of historically mobile trade, then the informal and illegal markets must be understood as well. The borders among Laos, Myanmar, Thailand, and China—the now heavily targeted Golden Quadrangle—are lined with informal markets of every kind,22 where manufactured or processed goods from China are displayed along with—although, noticeably, separate from—goods, mainly agricultural, of local origin. Similarly, the market traders are of varied ethnic backgrounds and “nationalities” in the modern sense, though mainly from the communities of the border region.

61Within these informal markets and market mechanisms, there is a qualitative difference in the local use and meanings of the word “production” as well as of “labour” from the meanings associated with modern market mechanisms. This is a difference that contributes directly to the participation of border dwellers in cross-border informal and illegal trade. In development economics and econometrics, the term “producers” usually designates those in the market economy who process or manufacture for sale the raw materials that have, in reality, been “produced” either in nature or by local people. These goods are presumed to be produced on the basis of existing or projected market demand and are therefore priced according to what the market will bear, thus connecting such end-stage producers to the consumers who acquire their goods through the intermediary of the market and of financial instruments. The Social Accounting Matrix, for example, describes and models producers in this way.

Structural Equation Modeling (SEM)
SEM can accommodate time-series data, and can also provide a simple relationship between an independent variable and one or two dependent variables or changes.
It can also show regional or multi-regional factors, unlike SAM.

Factors in Cross-border Informal Trade

Before the Financial Crisis

After the Financial Crisis

1. Factories (small-scale) operations (manufacturing level or stage)
2. Wages
3. Agricultural Products
4. Transport Costs
5. Products (Categories, Type)
6. Land ownership
7. Workforce
8. Associated 'piggyback' work (petty trade, CSW, substances, brokerage)

1. Factories (small-scale) operations (manufacturing level or stage)
2. Wages
3. Agricultural Products
4. Transport Costs
5. Products (Categories, Type, Level)
6. Land ownership
7. Workforce
8. Associated 'piggyback' work (petty trade, CSW, banned substances, brokerage)

Independent Variables: Economic Status of Owners/Managers, Workers/Transporters, and Consumers in 3 given time periods, surveyed in Year 2008 spring, 2009 spring, and 2009 autumn

Galactic Economies, Global Economies: SAM (Social Accounting Matrix)-based Model

Galactic Economies, Global Economies: SAM (Social Accounting Matrix)-based Model

Some differences between “Global” and “Galactic” economies



1. 1st World ↔ 1st World
1st World → 3rd World

1. Regional

2. International → Village

2. Town ↔ Town

3. Borderless for the Investors;
bordered vis-à-vis labor / consumers

3. Borderless

4. Secondary, Tertiary sectors
- Materials
- Goods
- Services

4. Primary, Secondary Sectors

62“Producers” in the local border community, however, are much more likely to be seen by themselves and their “wholesale” buyers—the processors and manufacturers who want their raw materials—as those who produce or extract materials directly from the local environment and then offer them to the workshops or factories that will then process the materials to “produce”, in a secondary sense, things for sale on the open market. Though this local, older conception of producers accords with the role now assigned them in the market economy as the “primary sector”, it also overlaps with their continuing roles as transporters and as consumers as well. A local resident who produces (grows) and cuts timber may be the same person who illegally transports it to a producer of finished goods waiting across the border; and may also be the same person who, while across the border, purchases and then transports finished goods to his or her household or even to the local market for re-sale.

63Similarly, the local meaning of “labour’’and its outputs differ significantly from the modern market definition. The historical construction of labour as paid labour, and work as extra-household work since the Industrial Revolution has often been described as having radically changed the meaning of labour in the West. There is a similar change perceivable in rural Southeast Asia, but there is also a context-specific set of changes with the micro-economy of the border region. First, both because the transition to the market economy is still underway, and because of its inhabitants’ reliance on agriculture, both paid (market) and unpaid (self-production) labour are undertaken at the same time and by the same persons, whether in seasonal or in daily rotation. In the current rural micro-economy where, as described above, not only participation in for-market production but also market consumption are now necessary, this drives rural border dwellers to engage regularly in cross-border trade, especially the sort of trade that can be conducted without payment of tariffs: that is, the small-scale production, sale, and transport of items for personal or household use, whose contents or ingredients are also not checked at the border and may be illegal or hazardous. The actual volume and contents of this petty trade are, therefore, unknown. Although it may be tempting to assume that only registered and high-volume cargoes are of a quantity sufficient to require legal and environmental regulation, there is currently no basis on which to judge the volume, and therefore the extent, of the illegal and hazardous trade on the personal and household basis, nor to project their environmental and health impacts. Each nation that is involved in cross-border trade keeps records of the volume and frequency of cross-border transports by registered companies and vehicles, and the volume continues to be high. But if the number of consumers and traders daily crossing the extensive borders of the Golden Quadrangle—the enormously long border of Myanmar, the extensive and poorly monitored northern borders of Laos and Vietnam, for example—reaches even a daily average of one hundred persons per crossing point carrying an average of ten kilograms, and given that there are hundreds of informal crossing points in the Upper GMS, this individual trade alone would account for a minimum of 100,000 kilograms of illegally or informally traded goods per day. Though estimates like these must, for the time being, remain in the realm of speculation, it is entirely possible that this number is a minimum. If so, the volume of illegal and informal goods as well as their impact on health, the environment, and the regional economy, now begin to show their real and urgent significance.

64Further, in terms of traditional and modern labour practises, it is often said by development planners that infrastructure and industrial development bring with them the opportunities for cash employment that were absent in earlier, pre-market economies. In the present case, with the pre-existing road conditions, followed by the road construction after the year 2000, this is both true and false. Lao labour can be and is brought in as agricultural hired, seasonal labour to work on the newly cleared areas near the highway. Lao nationals are also paid to carry small loads, by pick-up truck or by physical portage, along the roadway. Further, Lao nationals of Chinese descent are quite well able to traverse the road in order to connect to suppliers in China and bring their products back to Laos for local markets. As described below, the importation of labour from the investing and infrastructure-building country is a practise that can narrow the income disparity of the investing country, but does little to help with the over-supply of labour and lack of employment opportunities of the local residents.

B - Status of road construction of Asian Highway No. 3 while still in progress, its associated infrastructures such as electric wiring, grading, roadside drainage, and land use patterns

65The effect of these are as incentives to local residents to engage in informal trade on both sides of the border in order to secure livelihoods that have been lost or reduced due to loss of land or other productive resources in the process of road and infrastructure building.

66Recent changes in land use patterns and livelihoods, including those that accompany the construction of the northern highway, have been extensively documented in longitudinal studies by Yokoyama et al. (2008). Although it would seem quite likely that some of the road construction works were allocated to hired Lao labour, the present research found that upland northern Lao were more likely to be given irregular payments for deforesting land that would become the roadbeds or neighbouring slopes that would become tea and other plantations managed by outside investors. Further, such deforestation produces a large volume of timber and logs for the foreign market in what seems to be a legally agreed manner: a foreign investor contracts with the Lao government to lease and manage a plantation, which necessitates clearing the land of trees in order to plant the agreed crop. The volume of the felled timber can thus exceed the yearly amount of legal timber cutting prescribed by domestic law. The timber can also “belong” to the foreign managing company, which thus can deforest the area, and also acquire desirable timber at no cost at all. Shipment of the timber across the border into a neighbouring country is also inexpensive because it can be done by truck and requires only a short distance and time for travel. According to the local Chinese residents of northern Lao, the timber can then be sold at a relatively high price and subsequently processed and made into furniture for many times more than its original value.

67For this reason, there are two land use changes that play an important role here. The first is the land use pattern that changes when the roadbed and road surface are engineered. Of course the land area taken up by the road and its swales and road borders will reduce the amount of land previously used for other purposes or playing other ecological roles that are not only for direct human purposes. Unused land maintains soil fertility, moisture, and water sources, and reduces air pollution and ambient toxins. With a reduction in used and unused land, the livelihood-producing ability of the land also declines, accompanied by the likelihood of local residents seeking new, informal or illegal forms of livelihood.

68In addition to the diversion of rural land to road construction, however, there are also the changes brought about by the engineering of drainage systems, of a new gradient for the road that will alter natural sloping and natural drainage as well as soil composition, and finally, the electric wiring and in some areas provision of petrol that are necessary to the functioning of road construction crews and subsequent road transport. These latter can quickly and radically (or permanently) alter the livelihoods and cognitive maps of local residents. Border dwellers in northern Laos include people who have never had access, in the past, to electricity or to manufactured fuels such as petrol. They may still not have legal access to these things after they have been installed along the highway but it is still not difficult to connect a length of cheaply purchased copper wire—also available in local markets since the roads themselves make possible the greater import of cheaply manufactured household goods—to the main wire in such a way as to provide a small amount of wattage to a hut. The present survey noted, among the new roadside dwellers, such crude wiring and its use in the presence of electric rice cookers and low-watt electric bulbs as well as small hand machinery (electric tools)—themselves the result of recent purchases of cross-border imported and in some cases counterfeit goods.

69It is often said that wealth drives wealth and consumerism drives consumerism. How far this is true in a newly monetarising economy is beyond the scope of this study. But in the small, and very low-capital, money economy that is entering with the new roads, it is evident that on the household level, the access to infrastructure accompanies the availability and the corresponding consumption of new and inexpensive goods which are themselves disposable and thus require the continual, renewed production and consumption that characterise a capital economy. Yet in order to stay even within the legal capital economy, the rural consumer often needs to participate in the illegal economy of cross-border trade through several options. One is to engage in petty trade or consumption of a personal and illicit nature.

70In many parts of East and Southeast Asia, a road or village street serves not to divide two sides of a community, but to bring people together. In areas where traditionally there was little vehicle traffic, the road was a public space in which informal and formal gatherings could occur. Neighbours could gather to exchange news and maintain social networks; village events and ceremonies could be centred in the road space; village leaders’ announcements could be made from the road; economic transactions occurred in the meeting space provided by the road. The sort of modern highway that is now being built along the borders of the GMS, however, is quite different in quality and function. In addition to bringing benefits, it has disrupted the earlier patterns of land and road use in ways that have yet to be replaced.

C - Status and growth of local markets, in the concrete sense of traditional outdoor markets in rural areas and street-side markets in urban areas

71The survey included records of what was sold or traded and at what prices, and also differing goods involved in the nearly universal division of local markets, throughout the Upper GMS, into “Chinese” markets and “local” (meaning ethnically Lao, Myanmar, or Shan) markets.

72The market themselves, in both the sense of physical locations for transactions, and in the wider sense of a socio-economically functioning space or system for the circulation and fulfilment of a variety of needs, including intangible needs, are, second to the ecology of the region, most visibly affected by the expansion and improvement of the road system described above. The present survey was able to observe the physical markets very clearly. For the larger regional perspective on informal and illegal trade as an activity and a growing phenomenon upon which the region is deeply dependent economically, it is equally important to gain an understanding of how the regional, rather than purely national, and also non-financial markets are changing. The major factors here are not only the infrastructure, but also the global and regional economic recession from which the GMS is not recovering.

D - Lengthy discussion with informants in the rural and urban Upper GMS involving changing patterns of trade, influence of private-sector Chinese involvement in the region, changes in land use, and changes in local production, marketing, consumption, and expenditure

73Another feature of the modernising economy in Southeast Asia is agribusiness. For countries that have long had the traditional skills and natural resources for high agricultural production, agriculture for the export market is a natural policy choice. Policies to promote agricultural exports are negotiated and decided on at the national level, with contracts and subcontracts going to domestic and foreign enterprises. Agribusiness necessitates plantation agriculture requiring large tracts of land and a substantial temporary work force. Again, the lowest-educated of the rural population, and those who do not own their own land, will be recruited for the plantation jobs. The need for cash also encourages a larger number of persons, usually women, to sell farm produce or handmade items at local markets on a daily or weekly basis. In order to produce enough agricultural or handmade items for sale, the worker must invest cash in materials, rental of land for agricultural production, and rental of market space. The cash must be obtained first through the sale of land, mobile labour, or through local high-interest loans from informal lenders based on land as collateral. All of these, as we have seen above, put the borrower in an extremely vulnerable position vis-à-vis human security.

74Further, the entrance of industry to rural areas of the GMS is relatively recent. Its introduction and expansion is implemented by local governments, as well as local and trans-national corporations, as the key to rural development. The relative newness and scarcity of manufacturing plants mean that they can be affordably located on large tracts of rural land. Like agribusiness, industrialisation policy also depends on partnerships between private enterprise and national and local governments, and also deprives the rural producers of large tracts of land. Further, industrialisation degrades the land and surrounding environment to the point where it becomes unusable and uninhabitable. Industrial parks, dams, and mines are increasingly built or excavated on the cheaply available rural land of the Upper GMS. They may be able to recruit unskilled labour to transport their legal and illegal materials from among the local rural populations, but if they do, it is because these workers have become land-poor and welcome new employment opportunities. One of the reasons that unskilled, cheap labour continues to be available is because the land that previously offered subsistence has been bought or degraded by these industries themselves.

75Here, policies and policymaking agencies often clash. In northern Laos, the local agricultural extension office may very well be at loggerheads with the national policy to “alleviate poverty” by purchasing and encouraging use of hazardous chemicals for use in large-scale plantation agriculture.


20 See Alan Smith for a discussion of the land area and food volume required to prevent starvation in rural areas of South Asia.

21 Pittaya Fhusai, ed., ch. 3 passim.

22 See also Danielle Tan, Du Triangle d’or au Quadrangle économique, for a discussion of other forms of illegal trade in the Quadrangle, particularly human trafficking.

Table des illustrations

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Titre Galactic Economies, Global Economies: SAM (Social Accounting Matrix)-based Model
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© Institut de recherche sur l’Asie du Sud-Est contemporaine, 2010

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