A dam disaster in Laos

ON THE evening of July 23rd villagers along the Xe Pian river in southern Laos heard the roar of surging water. A dam 5km upstream had collapsed. The torrent inundated six villages. Homes were swept away, and around 7,000 people displaced. At least 20 are known to have died. Rescue attempts are being hampered by poor phone signals and heavy rains.

The dam was under construction when it burst. Fractures were discovered the day before, according to SK Engineering & Construction, a South Korean firm in the $1.2bn hydroelectric venture of which the dam forms a part. Rain had hindered attempts to fix the damage.

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The disaster highlights Laos’s big bet on hydroelectric power. The communist country is landlocked and cash-strapped. Its solution is to build lots of dams along the Mekong river and its tributaries, with Thai and Chinese backing, and to sell the electricity to neighbours. Last year Laos had 47 projects. It plans to have 100 by 2020. Laos wants to become the “battery of Asia”. In 2017 electricity accounted for 23% of its exports, up from 12% in 2010.

The strategy has costs. The dams turn a free-flowing river into a chain of reservoirs, says Maureen Harris of International Rivers, an NGO. That makes it hard for migratory fish to breed, especially the giant catfish and the giant pangasius, two of the Mekong’s largest freshwater species. The river also carries nutrient-rich sediments to rice farmers downstream in the Mekong delta in Vietnam. A recent study by the Mekong River Commission estimated that if Laos achieves its dam-building target, the amount of sediment that reaches the delta will fall to only two-thirds of its level in 2007.

Now, to the list of concerns, add the safety of locals. This week’s flood is not the first to be caused by such a collapse. In September a dam in Xiangkhouang in the north broke. Happily, no one died then. But if the country’s hydroelectric ambitions make flooding worse, then calls to power down the battery of Asia will grow louder.

From dusty villages to Delhi, Indians seek people to persecute

WHEN the two old friends set off in early June for a day in the country, they had no inkling of what was in store. Abhijit Nath, a 30-year-old businessman, liked cooking, dogs and fancy pet fish. Nilotpal Das, 29, a dreamy, dreadlocked sound technician, had recently motorbiked the breadth of India, from the beaches of Goa in the west all the way back to their shared hometown, Guwahati, capital of the north-eastern state of Assam. Both loved the outdoors, which is why they steered Mr Nath’s shiny black SUV out of the city towards Kangthilangso Falls, three hours to the east, in jungle-wrapped hills.

Accounts vary, but the outcome is not in question. Towards dusk, as the two friends headed down from the falls into flatter, more open country, a crowd of villagers surrounded their car. Many carried clubs or metal bars and shouted, “Child-snatchers!” Footage of the scene captures the bloodied victims pleading that they are not child-snatchers nor even outsiders, but native Assamese—to no avail.

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Two of many

Within the past two months, angry mobs have bludgeoned 22 people to death in similar fashion and for similar reasons. On July 1st it was five beggars who had just stepped off a bus at a village market in Maharashtra. On June 26th the victim was a woman, dragged out of an autorickshaw in the western state of Gujarat. Soon afterwards mobs in Tripura far to the east killed three people in separate incidents; one of them, ironically, was a man hired in a government campaign to raise awareness of the danger of fake news, particularly about strangers hunting children to steal.

Many blame social media for these incidents, and especially WhatsApp, which is ubiquitous on Indian mobiles. Yet although it is true that such services have indeed been vectors in the epidemic of deadly rumour, the focus on their role obscures other factors of equal or perhaps greater importance. There is, for example, the uncomfortable fact that lots of children do get snatched and sold, whether to childless families, or into servitude or sex work or worse. Official crime statistics suggest that between 2011 and 2016 the number of children reported missing each year rose by 250%. Of the 110,000 that disappeared in 2016, half remained untraced by the end of the year.

A further disturbing fact is that, given the nature of India’s police force and its courts, it is perhaps natural that poor villagers should feel little compunction about taking the law into their own hands. Tasked primarily with keeping basic order and protecting the powerful, the thinly spread and formidably corrupt police are ill equipped either to uphold the law in remote provinces or to inspire much respect for it. Even when the wheels of justice do turn, the slowness of the courts discourages all but the infinitely patient, naive or rich from resorting to them.

There is another unsavoury factor, too. A striking detail unites virtually all the latest instances of child-snatching vigilantism, as it does other cases of deadly mob violence in supposed defence of cows, or directed against suspected witches, or lower-caste defilers of upper-caste space. Perpetrators and victims tend nearly always to belong to starkly different social groups. They are strangers, divided by religion or language or caste, and in today’s India this difference seems to translate into a licence to hate.

For all their pleading to be as native to Assam as their killers, Mr Nath and Mr Das were seen as outsiders. They happened to be urban, Assamese-speaking, Hindu and middle class. The tribal area where they met their fate is one of the poorest in India. Its Karbi people speak their own language. Their folk tales warn children to beware of long-haired strangers.

Moreover, being a suspicious stranger has lately taken on special meaning in Assam. The state is among India’s most ethnically, linguistically and religiously varied, and practises some of its most toxic identity politics. For decades the largest group, Assamese-speaking Hindus, has railed about the terrible threat to their culture supposedly posed not just by various “jungli” tribes, but most especially by the third of the state’s inhabitants who speak Bengali. Most are Muslim, and some are recent immigrants from neighbouring Bangladesh.

Acting on claims that voter rolls are packed with such interlopers, the state’s government is working hard to complete a register of its 30m citizens. Its rules place the onus upon anyone fingered as a possible alien to prove otherwise. Shoddy record-keeping, low literacy and shifting, poorly demarcated borders make this difficult. Already some 2,000 people have been jailed for failing to establish Indian citizenship. Supporters of the state government hope some 4m-5m more will similarly be stripped of their rights, though it remains far from clear what might then happen to them. Bangladesh, already host to 1m destitute Rohingya refugees chased out of Myanmar, wants nothing to do with the whole process. As July 30th, the date for the publication of the final list, approaches, tension in the state is rising.

Assam’s pursuit of slow, democratic and legally sanctioned ethnic cleansing is also causing friction with the central government. Not because the two disagree in principle: the same party rules both state and centre. The trouble is that the government in Delhi is backing another law, which specifically states that India will henceforth accept refugees from neighbouring countries only if they are Hindu, Sikh, Buddhist or Christian. Muslims need not apply. Yet instead of attracting applause from Assamese chauvinists, the law raises a red flag, because thousands more Hindu refugees from Bangladesh might invade “their” state.

It is ironic that India, a country that was wounded at birth by the politics of division, should keep re-enacting partition at every level, from the dustiest hamlet to the pinnacle of power in Delhi. Of all people, Indians should know that the making of aliens and enemies is a dangerous game.

A “slight correction on democracy” in Cambodia

ALONG the banks of the swollen Mekong, aspiring politicians lead small convoys of vehicles through the countryside. Loudspeakers in the backs of pickups blast the local population with promises. Party volunteers, some with small children, hop off scooters to hand stickers to prospective voters. The activity is reaching fever pitch: more than 8m Cambodians are eligible to cast ballots in a national election on July 29th. Up for grabs are the 125 seats in Cambodia’s National Assembly, its lower house of parliament. Yet the outcome is hardly in doubt—not least because the ruling party has abolished the main opposition. The prime minister, Hun Sen, in power since 1985, will rule as the country’s strongman for a while longer.

His Cambodian People’s Party (CPP) has left little to chance. Last September Kem Sokha, who led the Cambodian National Rescue Party (CNRP), was arrested on trumped-up treason charges and still awaits trial. Another CNRP leader, Sam Rainsy, cannot return from France without risking arrest. In November the Supreme Court dissolved the CNRP for supposed attempts to stir up a “colour revolution” with America’s help. Its 55 seats in the National Assembly and hundreds of commune chief posts went to the CPP and to FUNCINPEC, a royalist party aligned with the ruling party. It was, the government explained, “a slight correction on democracy for the common public good”.

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Campaigns to suppress civil-rights groups and the press also stepped up a gear. One newspaper closed after a sudden tax demand of $6.3m. Dozens of radio stations, which once gave the opposition a voice, have gone off-air. A score of small parties will compete on polling day, but will struggle against the CPP’s might and machinery. Most offer little leadership. The head of the Dharmacracy Party says that a spirit told her to enter politics.

The best of the new parties, the Grassroots Democracy Party (GDP), emerged out of an activism network founded by Kem Ley, a dissident assassinated two years ago. Farmers and students form the GDP’s base, with Facebook its chief medium. One young man training to be a mechanic says he likes its promise of tuition loans. Sam Inn, who is running as a candidate in Phnom Penh, the capital, says the party’s policies of education reform, free health-care schemes and more infrastructure will help it win 42 seats. It sounds optimistic: the GDP boasts barely 10,000 members.

A fig leaf of multiparty democracy probably matters to the 65-year-old autocrat. Mr Hun Sen’s people point to other parties competing as evidence of a legitimate contest. Suos Yara, the CPP spokesman, highlights the many foreign observers flying in to monitor the election. Yet the charade fools few. Mr Sam Rainsy has called for Cambodians to boycott the election: to vote, says the exiled leader, “is to endorse the death of democracy”. Mr Hun Sen would probably read a low turnout as a personal rebuke.

For all its power, the regime seems uneasy. The CNRP nearly won the last general election five years ago. Months of protests then erupted as angry workers from the textile factories on the edges of Phnom Penh demanded better pay and conditions. This time Mr Hun Sen has led a charm offensive among the garment workers, once a CNRP base. He has raised their minimum wage so far that it risks pushing the whole industry to Bangladesh. Whether Mr Hun Sen’s advisers have dared point that out to him is unclear.

Their habit is always to flatter him. Mr Hun Sen and his wife, Bun Rany, sit like the rulers of old Angkor at the heart of cosmic relations, handing out rococo titles and rich sinecures to members of their court. While cronies prosper from logging concessions or licences to set up gambling operations, schools crumble and health care is out of reach for Cambodia’s poorest. Foreign policy is outsourced to China (to the annoyance of other members of ASEAN, the ten-country Association of South-East Asian Nations). Even the offspring of elites enriched by Mr Hun Sen’s rule say in private that it cannot go on like this forever. Some observers suspect Mr Hun Sen, whose right-hand man, Sok An, died last year, is losing a once-sure touch.

Western governments decry Cambodia’s direction of travel. The EU and America withheld funding for this election. Visa bans prevent many of Mr Hun Sen’s cronies from travelling to the United States. Denying Cambodia preferential trade access is another option—the EU alone receives about half of Cambodia’s exports, mostly sugar and clothes. But that would be a draconian action. It would hurt workers in some of the economy’s sunniest spots more than it would Mr Hun Sen, the country’s sun king, himself.

How badly are sanctions hurting North Korea’s Kim Jong Un?

THE increasingly severe trade and other sanctions the UN has imposed on North Korea have the aim of getting its dictator, Kim Jong Un, to give up his nuclear weapons. That the sanctions were causing pain plausibly played some part in bringing Mr Kim to suspend his nuclear and missile testing, and to extend a hand first to South Korea and then to the United States, at a summit in Singapore in June with President Donald Trump. Their continuation, say Americans negotiating with North Korea, is essential to maintain pressure on Mr Kim to disarm.

Yet even at the best of times, gauging the state of North Korea’s economy is fiendishly hard. Much of it is closed, and the secretive state publishes almost no economic data. It is up to others to try to piece a picture together. Last week South Korea’s central bank came up with a striking assessment that suggested sanctions were already biting hard last year, before the most serious ones had time to take effect.

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According to the Bank of Korea (BoK), North Korea’s GDP shrank by 3.5% in 2017, the biggest contraction since 1997, when the country was in the throes of a terrible famine. The largest effects were observed in sectors that sanctions have directly targeted: mining declined by 11%, heavy industry by 10.4% and construction by 4.4%. Exports to China fell sharply.

This is all consistent with sanctions causing serious economic pain. Most of North Korea’s oil and much of its food comes through China. Kim Byong-yeon at Seoul National University says the figures are a reminder that the North’s economy is more vulnerable to external shocks than might be expected for such a reclusive country. He expects the economy to shrink even more this year, as less revenue from exports hits imports and consumption.

Yet the story may not be as straightforward as the BoK’s numbers suggest. Some indicators commonly used to gauge what is going on do not obviously tally with its assessment. On the black market the North Korean won has barely moved against the dollar since Mr Kim came to power upon his father’s death in late 2011. The unofficial price of fuel, tracked by NKPro, a research outfit, implies no great economic strain. And a stroll about Pyongyang, the capital, suggests that a building and consumption boom is under way.

Other reasons to be sceptical include the central bank’s crop estimates, which come from South Korea’s rural development agency. Its insights about North Korean farm output are little better than anyone else’s. Meanwhile, other data come from the national intelligence agency, which gets plenty of other stuff about North Korea wrong. Trade statistics are derived from data provided by China. Having signed on to UN sanctions, it has an interest in downplaying the extent of its economic relationship with North Korea. Last, official calculations make little allowance for the size of an informal economy from which ordinary North Koreans derive a vast chunk of their livelihoods.

Besides, sanctions can be circumvented, and the North is a master of subterfuge. Crabs caught in North Korean waters are sold to Chinese or Russian fishermen at sea or in mid-river. Dried seafood is smuggled out across a land border with China in the far north. To smuggle coal, North Korean ships turn off their transponders when leaving North Korean waters. They fake port calls in China or Russia, loitering outside ports to create the impression that they are loading there, before moving to another port to unload. The financial transactions associated with these sales are disguised through a welter of front companies abroad. Several thousand tonnes of North Korean coal, marked as Russian, made it to ports around Asia last year. Ship-to-ship transfers in the East China Sea or the Sea of Japan are another, albeit riskier, ploy. American and Japanese spooks report 89 transfers of refined oil products between January and May this year, evading UN-imposed caps on fuel imports.

Brotherly love, again

More important than these tactics are shifting views in China. It is the North’s biggest trading partner, and the sanctions regime has little bite without its full-hearted participation. Its diplomats at the UN continue to pay lip service to the sanctions. Yet the will to enforce them is flagging now that nuclear tensions on the Korean peninsula have eased and ties are improving. Following meetings between Mr Kim and Xi Jinping, China’s leader, Chinese officials are welcome again in Pyongyang. Beijing has reportedly approved a plan by Liaoning province, adjacent to North Korea, to spend 600m yuan ($88m) on new roads on the North Korean side of the “friendship” bridge linking the two countries at Dandong. At his press conference following the Singapore summit, Mr Trump acknowledged that China was easing pressure on North Korea. China, he said, had monitored the border “maybe a little less…over the last couple of months, but that’s OK” (putting him at odds with America’s official, harder line). People on the Chinese side say trade and smuggling are much less hampered by officials than earlier in the year. Local officials have never liked the sanctions. Now, the authorities in Beijing either deem their enforcement less of a priority, or are directing that they be flouted.

In terms of time, effort and lost trade, any sanctions regime has costs for the enforcers, says Andrea Berger at King’s College, London. Last week China and Russia rebuffed an American request at the UN to step up enforcement of sanctions. South Korea has been asking for (and receiving) sanctions exemptions for its own engagement with the North.

So the effectiveness of economic pressure may continue to wane. As it is, on July 22nd the Washington Post reported Mr Trump’s frustration that little had come of a summit with Mr Kim that he did so much to hype. In follow-up meetings with their North Korean counterparts, administration officials have encountered no end of obfuscation and delay. Predictably, in a tweet this week, the president denied the report. And on July 23rd a North Korea-watching website, 38 North, published satellite images suggesting that North Korea had begun to dismantle a key intercontinental missile launch site. If true, Mr Trump will surely boast that sanctions and his brilliant diplomacy are working. Even as Mr Kim maintains other sites and their missiles—and enjoys the benefits of a loosening sanctions regime.

Imran Khan’s unsportsmanlike win in Pakistan

SOME 22 years after Imran Khan founded Pakistan Tehreek-e-Insaf (PTI) to break open the country’s corrupt dynastic politics, the 65-year-old former cricket star was waiting, as The Economist went to press, for official confirmation that his party had won the most seats in Pakistan’s general election. Projections suggested a tally of around 120 seats: short of a majority of the 272 elected seats in the lower house, but enough to form a ruling coalition with independent MPs rather than having to haggle with a serious rival party. Mr Khan looks to be the next prime minister. But his victory is far from sportsmanlike, in as tainted and perilously disputed an election as this one.

The doubts were long there. The outgoing majority party, the Pakistan Muslim League-Nawaz (PML-N), had warned that the army was “engineering” a victory for Mr Khan. The claim was echoed by civil-rights groups, the press and rival parties. The visas of an EU election-monitoring team were mysteriously delayed. Yet few expected widespread ballot-fixing, as in the days when generals used to stuff ballot-boxes full as sandbags.

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That now appears naive. The last general election, in 2013, was not free of allegations of foul play. But they were made by just one party, the disappointed PTI, and brushed off by international observers and a subsequent Supreme Court investigation. This time almost every party except Mr Khan’s raised accusations of vote-tampering. Groups as utterly opposed as Tehreek-e-Labbaik (a new hardline Islamist outfit) and the Pakistan Peoples Party (a secular group) claimed that security officials ordered their polling agents out of the voting stations before a final tally had been reached. The PML-N alleged particular abuse in constituencies where the race was tight. Shahbaz Sharif, who leads the party while his brother, Nawaz, a three-term former prime minister, watches from a prison cell on a disputed conviction for corruption, said his party “wholly rejects” the result. “Our democratic process has been pushed back by decades,” he claimed. A delay in results, blamed by the election commission on a software glitch, did not improve confidence in the result.

The cloud over the outcome may not dissipate soon. The PTI’s disappointed rivals could mirror Mr Khan’s own past example and take to the streets, as he did in a four-month protest following the last election. That protest, however, enjoyed the sympathy of the army, keen to clip the wings of the Sharif brothers. This time the soldiers have in their sights their ideal outcome: a pliable leader and a minority government that will not be too powerful.

Rival parties may be persuaded to desist, and a tenuous stability take hold. If so, Pakistan’s growing current-account crisis may look more manageable. A request before long for the biggest IMF bail-out in Pakistan’s history looks unavoidable. It will not be popular, and runs against Mr Khan’s promise to create an “Islamic welfare state”. Rather him, his rivals may think, to force through IMF demands for austerity, subsidy cuts and further devaluations to the Pakistani rupee. And while the PTI’s army-backed victory looks tainted, at least extreme religious parties which might have made common cause with Mr Khan look genuinely to have been trounced.

Why the Cook Islands fears rich-country status

MOST political leaders play up their country’s economic performance. Those on the Cook Islands, a collection of 15 islets spread over 2m square kilometres in the South Pacific, are doing the opposite.

At issue is whether the country of 17,000 people has become wealthy enough to warrant a reassignment by the OECD, a club of mostly rich countries, from upper middle-income to high-income status. The rub is that “graduation” would make it more difficult for the country to claim it qualifies for aid. This amounted to NZ$33m ($22m) in 2016, or just under 8% of the islands’ GDP. However, New Zealand, the biggest donor country to date, has said it will continue to give an unspecified amount of financial assistance if the Cook Islands graduates. 

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Henry Puna, the prime minister, has acknowledged that achieving high-income status would be a source of national pride. It would be a first for a Pacific-island state. But he has warned that “premature graduation could have serious implications” for his country. The finance ministry downplays the islands’ impressive average annual growth of around 5% between 2014 and 2016. It noted in a recent press release that “economic growth may not have been as strong as we thought”.  

The OECD sorts countries into groups based on their gross national income (GNI) per person. Countries that exceed the high-income threshold, as defined by the World Bank, for three consecutive years are promoted to the list of developed countries. (In 2016 the high-income threshold was $12,236.) The Cook Islands, however, does not produce data for GNI, only for GDP, which does not include net income from abroad. So when the OECD hinted last year that the islands appeared ready for graduation, officials resisted, arguing that they should be granted extra time to compile their own GNI statistics. The OECD set a deadline of early 2019.

 The Cook Islands has good reason to worry that the good times may not last. It has lost 12% of its population in the past 12 years, as young people seek greener pastures in New Zealand. (Cook Islanders hold New Zealand citizenship, thanks to their country’s “free association” arrangement with the former colonial master.) Spending by tourists accounts for over 60% of the islands’ economy. Around 80% of the visitors (161,000 of them last year) are from New Zealand and Australia. A recession in one of those countries, or a natural disaster at home, would be an enormous economic blow to the Cook Islands.  

Further complicating matters, the Cook Islands, after suffering the effects of profligacy in the mid-1990s, has since imposed on itself some of the world’s toughest fiscal constraints. These state that public debt be kept under 35% of GDP even as tax revenue is capped at 25% of GDP. Yet tax revenue is projected to breach the ceiling this year, and the debt-to-GDP ratio is inching closer to the upper bound. So raising taxes or issuing bonds are unlikely to be realistic alternatives if foreign aid is cut. 

Given these challenges, and the reliance of the OECD on countries’ own calculations of their GNI, Cook Islands officials may want to cook the books to avoid crossing the high-income threshold. But Mark Brown, the finance minister, dismisses this possibility. He says that massaging the GNI data “would not be acceptable to the OECD, nor do we believe that it would be in the best interests of the Cook Islands.”

Mr Brown concedes, however, that “a more gradual timeline, of say the early 2020s”, would be preferable for joining the ranks of the rich. That would allow more time for the economy to achieve “self-sufficiency”. One bright spot is the country’s vast seabed mineral deposits. The Cook Islands is reckoned to have up to a sixth of the world’s reserves of cobalt, an element used in batteries and jet engines. But large-scale mining is still a long way off. Well before then the OECD will have made a decision. According to an OECD spokesperson, if a country “meets the criteria for graduation, it cannot refuse graduation.” 

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