Concessions and Leases in the Lao PDR

Table 18: Elevation of Investment Projects Compared to All Land by Region
North
Centre South Nationwide
Investment
Investment
Elevation Total Area Total Area
Total Area
Areas
Areas
Investment
Areas
Total Area
Investment
Areas
0 - 200
0%
0%
18%
42%
44%
53%
18%
39%
200 - 500
12%
9%
28%
44%
27%
28%
21%
30%
500 - 800
34%
47%
22%
6%
12%
5%
24%
13%
800 - 1,200
41%
39%
20%
7%
13%
12%
27%
16%
> 1,200
13%
5%
12%
2%
4%
3%
10%
3%
3.2 - Accessibility
The geography which dominates most of the Lao PDR is
ruggedly mountainous, and issues of accessibility have long
shaped the geopolitical importance as well as the socioeconomic
position of this landlocked, sparsely populated country. The
transportation system is continuously evolving with the
construction of new roads, bridges and airports, and the
largely rural population is increasingly connected to markets
and services. Transportation and access are linked to economic
development, but whether and to what degree they shape
patterns in land investments and vice versa is explored in this
section. The GoL also expects land investments to bring
improvements in infrastructure – a benefit which would
affect local communities and the wider transportation
network across the country. Research on the reality of this
in the Lao PDR’s current land investment context is needed,
though global studies have shown that while other socioeconomic
indicators including employment creation do not
necessarily improve as a result of major land deals, transport
infrastructure often does improve (Anseeuw et al., 2012).
In the Lao PDR, it is important to determine whether large
investment projects provide additional infrastructure
development or, instead, whether investors tend to select
areas where such infrastructure is already in place. The analysis
of accessibility across areas under investment will shed some
light on this question by looking at the general accessibility
of areas where investment projects occur and patterns of
investment related to their travel time from the closest district
capital.
The estimated travel time from the district capital to the
investment area was the measure used in this analysis to
quantify accessibility and travel time for each concession was
weighted by the area of that project. Considering the range of
logistical challenges inherent in the data collection process,
a certain level of bias should be assumed in the analysis
presented here (especially a tarmac and road bias). On average,
investment projects are located around 1 ½ hours from
the closest district capital. Almost half of the land granted
for investment is within one hour (see Map 16), though there
is a significant difference in accessibility between concession
and lease project areas as well as across sectors. Almost all
areas under lease are reachable within one hour, however
53% of concession project areas are outside of one hour’s
reach and 13% of concession areas are not even within three
hours of the next district capital (see Figure 17).
Sector-wise, it is not surprising that land deals in the tertiary
sector are located in the most accessible areas, as this
sector focuses on the provision of goods and services and is
dominated by smaller lease projects in or around urban
areas. Primary sector deals occur in more remote areas, as
they are focused on natural resource extraction and often
demand larger areas for operation. That said, the agriculture,
forestry and mining subsectors follow very different trends in
terms of accessibility (see Figure 18).
The majority of agriculture and forestry areas under investment
(77% and 62% respectively) are located within just one hour
from the district capital, and 97% and 93% respectively are
located within two hours (see Figure 18). Mining stands out
with 58% of the area under investment over two hours from
the district capital. Mining projects are necessarily located
wherever significant mineral deposits are regardless of accessibility,
and if expected profit margins are large enough and
the required infrastructure does not already exist, it will often
be developed by the investor. On the other hand, agricultural
and forestry investments being less capital intensive, they
appear also to be more dependent on pre-existing infrastructure
and proximity to markets as well labour.
Although forestry and agriculture investments are not found
in areas as remote as is commonly assumed, many district
capitals can still be considered remote locations difficult to
CONTEXT OF INVESTMENT
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