Lao villagers reject offer for land lost to ‘Smart City’ project

Oudomxay province residents say they support development but want new plots to farm and enough money to restart.
By RFA Lao
Varong Tangpraprutgul, managing director Amata City Lao Sole Company (center L) and Sthabandith Insisienmay, Laos' vice minister of planning and investment, shake hands after signing an agreement for land for a Smart City project, in Laos, Aug. 25, 2022.
Photo courtesy of Amata City Laos

Residents of a village in Laos’ Oudomxay province have rejected a government offer of compensation for their farmland, which has been leased to a Thai company to build a “Smart City” in the area, saying it is too low for them to relocate.

On Aug. 25, the Lao government signed an agreement with Bangkok-based Amata Corporation Public Company Ltd., one of Thailand's leading industrial estate developers and operators, allowing it to use 3,150 hectares (7,785 acres) of land in Na Mor district to develop a Smart and Eco City there, although portions of it are actively farmed by area inhabitants.

The Smart and Eco City project is intended to spur sustainable and eco-friendly development in the northwestern province of the impoverished and landlocked country of more than 7 million people.

The government offered to pay residents 100,000-150,000 kip (U.S. $6.50-9.50) per square meter of land, though the villagers had asked for 250,000-500,000 kip per square meter, an official from the province’s Department of Natural Resources and Environment told RFA. 

The villagers have not agreed to accept the deal, said the official, who declined to provide his name so he could speak freely.

“The compensation is still low,” he said. “When villagers get the money, they won’t be able to use it to buy new land or build a new house. They are concerned. They want [the government] to review [the offer] again.”

The state owns all land in Laos, though it allows villagers to use parcels and pay taxes on them annually. But because they aren’t property owners, villagers forced to relocate for projects often say the proposed payments for the land they use, maybe for years, are insufficient.

While the government works on an acceptable compensation scheme for affected villagers and searches for new land for them to farm, area residents say they want fair compensation before construction begins.

Villagers don’t want to give up their farmland to the project, but they cannot resist,” said one affected resident on Tuesday. “They want fair compensation if they give up their land.”

Many locals are concerned that they may receive money but no land on which to earn a living and feed their families, said the villager, who declined to give his name.

“If they give up land to the project, they will have no land to produce food to feed their families,” he said.

Other Na Mor residents said they support development and would willingly surrender the land in exchange for fair compensation. 

“Villagers worry that if they give land to the project then they won’t have land to produce [vegetables],” he said. “What are they going to do to feed their families? What they have right now to support their families is their land. Without land they will not survive.”

Amata, which is ready to begin the Smart City project, has rights to use the land but is still waiting for the Lao government to allocate new land to the displaced villagers, said a company official.

“We expect it will happen very soon, then we will start the project at the end of 2022,” he said. “[Once] everything has been completed, we will invest right away.” 

The Lao government also granted Amata a concession to build a U.S. $1 billion Smart and Eco City in Nateuy on 410 hectares of land in northern Laos’ Luang Namtha province, which could expand to 20,000 hectares in subsequent construction phases, the Bangkok Post reported in January, citing Vikrom Kromadit, the company’s chairman and chief executive, as the source. 

Amata’s wholly owned subsidiary, Amata City Lao Sole Company, is building the industrial park that will incorporate energy-efficient infrastructure and sustainable environmental management, the report said. Once completed, the Smart City will serve international investors in sectors such as logistics and warehousing, machinery and food and beverage processing.

Amata has developed other industrial estates in Thailand and Vietnam.  

Translated by Sidney Khotpanya for RFA Lao. Written in English by Roseanne Gerin.


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Mike Boddington
Sep 01, 2022 11:49 PM

Where does RFA get its dollar-kip exchange rates from? It has been 15,000 kip per dollar most of this year.