Luxury Home Building by Lao Leaders Raises Eyebrows Among Citizens

laos-choummaly-sayasone-in-beijing-nov8-2014.jpg Laos President Choummaly Sayasone (L) greets China's President Xi Jinping (R) before a meeting in Beijing, Nov. 8, 2014.

Some top Lao politicians are building high-priced, luxury homes in the impoverished one-party communist country, raising questions among citizens about where the money is coming from, sources inside the country said.

Lao President Choummaly Sayasone is the latest top-level politician to build a pricey house and garden at a time when some low-level state employees and teachers are not paid their salaries on a regular basis.

Choummaly’s house in Thatluang village of Saysetha district in the capital Vientiane includes a 5 billion kip (U.S. $615,000) garden, a source with knowledge of the matter who did not want to be identified told RFA’s Laos Service, although he could not provide the price of the president’s house.

The building’s contractor, Phonesack Group Co. Ltd., hired Choey Studio Co. Ltd. to design and construct the garden, the source said.

The Phonesack Group has a good relationship with Choummaly’s family, he said, and is involved in logging, mining and other development projects in Laos.

Somsavath Lengsavath, the deputy prime minister, also has built a house which cost 20 billion kip (U.S. $2.5 million) in Nongniang village of Saysetha district.

The luxury homes have prompted Vientiane residents to question how and where the politicians are getting money from to spend on expensive construction and landscaping.

According to the World Bank, per capita annual income in Laos, a nation of 6.9 million people, was $1,450 in 2013.

“Can leaders answer my question about how much money they have after they combine all their salaries, allowances and bonuses?” asked one Vientiane resident, who declined to be named. “And how and where do they get the money to build the houses?”

Another Vientiane resident told RFA: “All of them build houses costing billions of kip. Where do they get the money from and why? Because they sell their signatures? This is a selling-signature time.”

Corruption problem

Many leaders in the Lao government, military and communist party engage in corruption and spend the proceeds on expensive homes and other luxury items, although corruption is a criminal act punishable by fine and/or imprisonment.

Top government officials in particular have been linked to the flourishing illegal timber trade between the country and neighboring Vietnam, according to sources who cite unofficial crossings along the border as conduits for the illicit activity.

Mining companies operating in provinces in southern Laos have claimed that some national leaders have pressured enforcement officials not to take action against the smuggling activity.

Corruption among high-level officials in Laos has been going on for years, if not decades.

Bouasone Bouphavanh, who was prime minister of the country from 2006 to 2010, called for a crackdown on corruption and luxurious living among government officials, according to media reports at the time.

He complained in a 2007 address to the Lao National Assembly, or parliament, that corruption and luxury were rife among government officials in the country.

Low-level bureaucrats, such as police officers and administrative workers, engage in corruption as well, using their authority to extract bribes from citizens.    

Corruption in Laos is so widespread that it has deterred foreign investors, created problems with the country’s ability to enforce business contracts and regulation, and left many ordinary citizens impoverished.

In 2014, Lao ranked 145 out of 175 countries on corruption in the nongovernmental organization Transparency International’s corruption perception index, which scores nations on how corrupt their public sectors are seen to be.

Reported by RFA’s Lao Service. Written in English by Roseanne Gerin.

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