(i) The entity should be regional in character involving all members of ASEAN;
(ii) The name "ASEAN" should not be brought into disrepute by its usage;
(iii) The entity should be indigenous to ASEAN;
(iv) The usage of ASEAN should not have any negative effect on the aims and objectives of ASEAN;
(v) The entity should have the sponsorship of any of the ASEAN National Secretariats.

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The Founding of ASEAN

It was a short, simply-worded document containing just five articles. It declared the establishment of an Association for Regional Cooperation among the Countries of Southeast Asia to be known as the Association of Southeast Asian Nations (ASEAN) and spelled out the aims and purposes of that Association. These aims and purposes were about cooperation in the economic, social, cultural, technical, educational and other fields, and in the promotion of regional peace and stability through abiding respect for justice and the rule of law and adherence to the principles of the United Nations Charter. It stipulated that the Association would be open for participation by all States in the Southeast Asian region subscribing to its aims, principles and purposes. It proclaimed ASEAN as representing "the collective will of the nations of Southeast Asia to bind themselves together in friendship and cooperation and, through joint efforts and sacrifices, secure for their peoples and for posterity the blessings of peace, freedom and prosperity."

And so in early August 1967, the five Foreign Ministers spent four days in the relative isolation of a beach resort in Bang Saen, a coastal town less than a hundred kilometers southeast of Bangkok. There they negotiated over that document in a decidedly informal manner which they would later delight in describing as "sports-shirt diplomacy." Yet it was by no means an easy process: each man brought into the deliberations a historical and political perspective that had no resemblance to that of any of the others. But with goodwill and good humor, as often as they huddled at the negotiating table, they finessed their way through their differences as they lined up their shots on the golf course and traded wisecracks on one another's game, a style of deliberation which would eventually become the ASEAN ministerial tradition.

Now, with the rigors of negotiations and the informalities of Bang Saen behind them, with their signatures neatly attached to the ASEAN Declaration, also known as the Bangkok Declaration, it was time for some formalities. The first to speak was the Philippine Secretary of Foreign Affairs, Narciso Ramos, a one-time journalist and long-time legislator who had given up a chance to be Speaker of the Philippine Congress to serve as one of his country's first diplomats. He was then 66 years old and his only son, the future President Fidel V. Ramos, was serving with the Philippine Civic Action Group in embattled Vietnam. He recalled the tediousness of the negotiations that preceded the signing of the Declaration that "truly taxed the goodwill, the imagination, the patience and understanding of the five participating Ministers." That ASEAN was established at all in spite of these difficulties, he said, meant that its foundations had been solidly laid. And he impressed it on the audience of diplomats, officials and media people who had witnessed the signing ceremony that a great sense of urgency had prompted the Ministers to go through all that trouble. He spoke darkly of the forces that were arrayed against the survival of the countries of Southeast Asia in those uncertain and critical times.

"The fragmented economies of Southeast Asia," he said, "(with) each country pursuing its own limited objectives and dissipating its meager resources in the overlapping or even conflicting endeavors of sister states carry the seeds of weakness in their incapacity for growth and their self-perpetuating dependence on the advanced, industrial nations. ASEAN, therefore, could marshal the still untapped potentials of this rich region through more substantial united action."

When it was his turn to speak, Adam Malik, Presidium Minister for Political Affairs and Minister for Foreign Affairs of Indonesia, recalled that about a year before, in Bangkok, at the conclusion of the peace talks between Indonesia and Malaysia, he had explored the idea of an organization such as ASEAN with his Malaysian and Thai counterparts. One of the "angry young men" in his country's struggle for independence two decades earlier, Adam Malik was then 50 years old and one of a Presidium of five led by then General Soeharto that was steering Indonesia from the verge of economic and political chaos. He was the Presidium's point man in Indonesia's efforts to mend fences with its neighbors in the wake of an unfortunate policy of confrontation. During the past year, he said, the Ministers had all worked together toward the realization of the ASEAN idea, "making haste slowly, in order to build a new association for regional cooperation."

Adam Malik went on to describe Indonesia's vision of a Southeast Asia developing into "a region which can stand on its own feet, strong enough to defend itself against any negative influence from outside the region." Such a vision, he stressed, was not wishful thinking, if the countries of the region effectively cooperated with each other, considering their combined natural resources and manpower. He referred to differences of outlook among the member countries, but those differences, he said, would be overcome through a maximum of goodwill and understanding, faith and realism. Hard work, patience and perseverance, he added, would also be necessary.

The countries of Southeast Asia should also be willing to take responsibility for whatever happens to them, according to Tun Abdul Razak, the Deputy Prime Minister of Malaysia, who spoke next. In his speech, he conjured a vision of an ASEAN that would include all the countries of Southeast Asia. Tun Abdul Razak was then concurrently his country's Minister of Defence and Minister of National Development. It was a time when national survival was the overriding thrust of Malaysia's relations with other nations and so as Minister of Defence, he was in charge of his country's foreign affairs. He stressed that the countries of the region should recognize that unless they assumed their common responsibility to shape their own destiny and to prevent external intervention and interference, Southeast Asia would remain fraught with danger and tension. And unless they took decisive and collective action to prevent the eruption of intra-regional conflicts, the nations of Southeast Asia would remain susceptible to manipulation, one against another.

"We the nations and peoples of Southeast Asia," Tun Abdul Razak said, "must get together and form by ourselves a new perspective and a new framework for our region. It is important that individually and jointly we should create a deep awareness that we cannot survive for long as independent but isolated peoples unless we also think and act together and unless we prove by deeds that we belong to a family of Southeast Asian nations bound together by ties of friendship and goodwill and imbued with our own ideals and aspirations and determined to shape our own destiny". He added that, "with the establishment of ASEAN, we have taken a firm and a bold step on that road".

For his part, S. Rajaratnam, a former Minister of Culture of multi-cultural Singapore who, at that time, served as its first Foreign Minister, noted that two decades of nationalist fervor had not fulfilled the expectations of the people of Southeast Asia for better living standards. If ASEAN would succeed, he said, then its members would have to marry national thinking with regional thinking.

S. Rajaratnam expressed the fear, however, that ASEAN would be misunderstood. "We are not against anything", he said, "not against anybody". And here he used a term that would have an ominous ring even today: balkanization. In Southeast Asia, as in Europe and any part of the world, he said, outside powers had a vested interest in the balkanization of the region. "We want to ensure," he said, "a stable Southeast Asia, not a balkanized Southeast Asia. And those countries who are interested, genuinely interested, in the stability of Southeast Asia, the prosperity of Southeast Asia, and better economic and social conditions, will welcome small countries getting together to pool their collective resources and their collective wisdom to contribute to the peace of the world."

The goal of ASEAN, then, is to create, not to destroy. This, the Foreign Minister of Thailand, Thanat Khoman, stressed when it was his turn to speak. At a time when the Vietnam conflict was raging and American forces seemed forever entrenched in Indochina, he had foreseen their eventual withdrawal from the area and had accordingly applied himself to adjusting Thailand's foreign policy to a reality that would only become apparent more than half a decade later. He must have had that in mind when, on that occasion, he said that the countries of Southeast Asia had no choice but to adjust to the exigencies of the time, to move toward closer cooperation and even integration. Elaborating on ASEAN objectives, he spoke of "building a new society that will be responsive to the needs of our time and efficiently equipped to bring about, for the enjoyment and the material as well as spiritual advancement of our peoples, conditions of stability and progress. Particularly what millions of men and women in our part of the world want is to erase the old and obsolete concept of domination and subjection of the past and replace it with the new spirit of give and take, of equality and partnership. More than anything else, they want to be master of their own house and to enjoy the inherent right to decide their own destiny ..."

While the nations of Southeast Asia prevent attempts to deprive them of their freedom and sovereignty, he said, they must first free themselves from the material impediments of ignorance, disease and hunger. Each of these nations cannot accomplish that alone, but by joining together and cooperating with those who have the same aspirations, these objectives become easier to attain. Then Thanat Khoman concluded: "What we have decided today is only a small beginning of what we hope will be a long and continuous sequence of accomplishments of which we ourselves, those who will join us later and the generations to come, can be proud. Let it be for Southeast Asia, a potentially rich region, rich in history, in spiritual as well as material resources and indeed for the whole ancient continent of Asia, the light of happiness and well-being that will shine over the uncounted millions of our struggling peoples."

The Foreign Minister of Thailand closed the inaugural session of the Association of Southeast Asian Nations by presenting each of his colleagues with a memento. Inscribed on the memento presented to the Foreign Minister of Indonesia, was the citation, "In recognition of services rendered by His Excellency Adam Malik to the ASEAN organization, the name of which was suggested by him."

And that was how ASEAN was conceived, given a name, and born. It had been barely 14 months since Thanat Khoman brought up the ASEAN idea in his conversations with his Malaysian and Indonesian colleagues. In about three more weeks, Indonesia would fully restore diplomatic relations with Malaysia, and soon after that with Singapore. That was by no means the end to intra-ASEAN disputes, for soon the Philippines and Malaysia would have a falling out on the issue of sovereignty over Sabah. Many disputes between ASEAN countries persist to this day. But all Member Countries are deeply committed to resolving their differences through peaceful means and in the spirit of mutual accommodation. Every dispute would have its proper season but it would not be allowed to get in the way of the task at hand. And at that time, the essential task was to lay the framework of regional dialogue and cooperation.

The two-page Bangkok Declaration not only contains the rationale for the establishment of ASEAN and its specific objectives.  It represents the organization’s modus operandi of building on small steps, voluntary, and informal arrangements towards more binding and institutionalized agreements.  All the founding member states and the newer members have stood fast to the spirit of the Bangkok Declaration.  Over the years, ASEAN has progressively entered into several formal and legally-binding instruments, such as the 1976 Treaty of Amity and Cooperation in Southeast Asia and the 1995 Treaty on the Southeast Asia Nuclear Weapon-Free Zone.

Against the backdrop of conflict in the then Indochina, the Founding Fathers had the foresight of building a community of and for all Southeast Asian states. Thus the Bangkok Declaration promulgated that "the Association is open for participation to all States in the Southeast Asian region subscribing to the aforementioned aims, principles and purposes."   ASEAN’s inclusive outlook has paved the way for community-building not only in Southeast Asia, but also in the broader Asia Pacific region where several other inter-governmental organizations now co-exist.

The original ASEAN logo presented five brown sheaves of rice stalks, one for each founding member. Beneath the sheaves is the legend "ASEAN" in blue. These are set on a field of yellow encircled by a blue border. Brown stands for strength and stability, yellow for prosperity and blue for the spirit of cordiality in which ASEAN affairs are conducted. When ASEAN celebrated its 30th Anniversary in 1997, the sheaves on the logo had increased to ten - representing all ten countries of Southeast Asia and reflecting the colors of the flags of all of them. In a very real sense, ASEAN and Southeast Asia would then be one and the same, just as the Founding Fathers had envisioned.

This article is based on the first chapter of ASEAN at 30, a publication of the Association of Southeast Asian Nations in commemoration of its 30th Anniversary on 8 August 1997, written by Jamil Maidan Flores and Jun Abad. 

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We in ASEAN have created a community of Southeast Asian nations at peace with one another and at peace with the world, rapidly achieving prosperity for our peoples and steadily improving their lives. Our rich diversity has provided the strength and inspiration to us to help one another foster a strong sense of community.

We are now a market of around 500 million people with a combined gross domestic product of US$600 billion. We have achieved considerable results in the economic field, such as high economic growth, stability and significant poverty alleviation over the past few years. Members have enjoyed substantial trade and investment flows from significant liberalisation measures.

We resolve to build upon these achievements.

Now, as we approach the 21st century, thirty years after the birth of ASEAN, we gather to chart a vision for ASEAN on the basis of today's realities and prospects in the decades leading to the Year 2020.

That vision is of ASEAN as a concert of Southeast Asian nations, outward looking, living in peace, stability and prosperity, bonded together in partnership in dynamic development and in a community of caring societies.

We envision the ASEAN region to be, in 2020, in full reality, a Zone of Peace, Freedom and Neutrality, as envisaged in the Kuala Lumpur Declaration of 1971.

ASEAN shall have, by the year 2020, established a peaceful and stable Southeast Asia where each nation is at peace with itself and where the causes for conflict have been eliminated, through abiding respect for justice and the rule of law and through the strengthening of national and regional resilience.

We envision a Southeast Asia where territorial and other disputes are resolved by peaceful means.

We envision the Treaty of Amity and Cooperation in Southeast Asia functioning fully as a binding code of conduct for our governments and peoples, to which other states with interests in the region adhere.

We envision a Southeast Asia free from nuclear weapons, with all the Nuclear Weapon States committed to the purposes of the Southeast Asia Nuclear Weapons Free Zone Treaty through their adherence to its Protocol. We also envision our region free from all other weapons of mass destruction.

We envision our rich human and natural resources contributing to our development and shared prosperity.

We envision the ASEAN Regional Forum as an established means for confidence-building and preventive diplomacy and for promoting conflict-resolution.

We envision a Southeast Asia where our mountains, rivers and seas no longer divide us but link us together in friendship, cooperation and commerce.

We see ASEAN as an effective force for peace, justice and moderation in the Asia-Pacific and in the world.

We resolve to chart a new direction towards the year 2020 called, ASEAN 2020 : Partnership in Dynamic Development which will forge closer economic integration within ASEAN.

We reiterate our resolve to enhance ASEAN economic cooperation through economic development strategies, which are in line with the aspiration of our respective peoples, which put emphasis on sustainable and equitable growth, and enhance national as well as regional resilience.

We pledge to sustain ASEAN's high economic performance by building upon the foundation of our existing cooperation efforts, consolidating our achievements, expanding our collective efforts and enhancing mutual assistance.

We commit ourselves to moving towards closer cohesion and economic integration, narrowing the gap in the level of development among Member Countries, ensuring that the multilateral trading system remains fair and open, and achieving global competitiveness.

We will create a stable, prosperous and highly competitive ASEAN Economic Region in which there is a free flow of goods, services and investments, a freer flow of capital, equitable economic development and reduced poverty and socio-economic disparities.

We resolve, inter-alia, to undertake the following:

• maintain regional macroeconomic and financial stability by promoting closer consultations in macroeconomic and financial policies.
• advance economic integration and cooperation by undertaking the following general strategies: fully implement the ASEAN Free Trade Area and accelerate liberalization of trade in services, realise the ASEAN Investment Area by 2010 and free flow of investments by 2020; intensify and expand sub-regional cooperation in existing and new sub-regional growth areas; further consolidate and expand extra-ASEAN regional linkages for mutual benefit cooperate to strengthen the multilateral trading system, and reinforce the role of the business sector as the engine of growth.
• promote a modern and competitive small and medium enterprises (SME) sector in ASEAN which will contribute to the industrial development and efficiency of the region.
• accelerate the free flow of professional and other services in the region.
• promote financial sector liberalisation and closer cooperation in money and capital market, tax, insurance and customs matters as well as closer consultations in macroeconomic and financial policies.
• accelerate the development of science and technology including information technology by establishing a regional information technology network and centers of excellence for dissemination of and easy access to data and information.
• establish interconnecting arrangements in the field of energy and utilities for electricity, natural gas and water within ASEAN through the ASEAN Power Grid and a Trans-ASEAN Gas Pipeline and Water Pipeline, and promote cooperation in energy efficiency and conservation, as well as the development of new and renewable energy resources.
• enhance food security and international competitiveness of food, agricultural and forest products, to make ASEAN a leading producer of these products, and promote the forestry sector as a model in forest management, conservation and sustainable development.
• meet the ever increasing demand for improved infrastructure and communications by developing an integrated and harmonized trans-ASEAN transportation network and harnessing technology advances in telecommunication and information technology, especially in linking the planned information highways/multimedia corridors in ASEAN, promoting open sky policy, developing multi-modal transport, facilitating goods in transit and integrating telecommunications networks through greater interconnectivity, coordination of frequencies and mutual recognition of equipment-type approval procedures.
• enhance human resource development in all sectors of the economy through quality education, upgrading of skills and capabilities and training.
• work towards a world class standards and conformance system that will provide a harmonised system to facilitate the free flow of ASEAN trade while meeting health, safety and environmental needs.
• use the ASEAN Foundation as one of the instruments to address issues of unequal economic development, poverty and socioeconomic disparities.
• promote an ASEAN customs partnership for world class standards and excellence in efficiency, professionalism and service, and uniformity through harmonised procedures, to promote trade and investment and to protect the health and well-being of the ASEAN community,
• enhance intra-ASEAN trade and investment in the mineral sector and to contribute towards a technologically competent ASEAN through closer networking and sharing of information on mineral and geosciences as well as to enhance cooperation and partnership with dialogue partners to facilitate the development and transfer of technology in the mineral sector, particularly in the downstream research and the geosciences and to develop appropriate mechanism for these.

We envision the entire Southeast Asia to be, by 2020, an ASEAN community conscious of its ties of history, aware of its cultural heritage and bound by a common regional identity.

We see vibrant and open ASEAN societies consistent with their respective national identities, where all people enjoy equitable access to opportunities for total human development regardless of gender, race, religion, language, or social and cultural background.

We envision a socially cohesive and caring ASEAN where hunger, malnutrition, deprivation and poverty are no longer basic problems, where strong families as the basic units of society tend to their members particularly the children, youth, women and elderly; and where the civil society is empowered and gives special attention to the disadvantaged, disabled and marginalized and where social justice and the rule of law reign.

We see well before 2020 a Southeast Asia free of illicit drugs, free of their production, processing, trafficking and use.

We envision a technologically competitive ASEAN competent in strategic and enabling technologies, with an adequate pool of technologically qualified and trained manpower, and strong networks of scientific and technological institutions and centers of excellence.

We envision a clean and green ASEAN with fully established mechanisms for sustainable development to ensure the protection of the region's environment, the sustainability of its natural resources, and the high quality of life of its peoples.

We envision the evolution in Southeast Asia of agreed rules of behaviour and cooperative measures to deal with problems that can be met only on a regional scale, including environmental pollution and degradation, drug trafficking, trafficking in women and children, and other transnational crimes.

We envision our nations being governed with the consent and greater participation of the people with its focus on the welfare and dignity of the human person and the good of the community.

We resolve to develop and strengthen ASEAN's institutions and mechanisms to enable ASEAN to realize the vision and respond to the challenges of the coming century. We also see the need for a strengthened ASEAN Secretariat with an enhanced role to support the realization of our vision.

We see an outward-looking ASEAN playing a pivotal role in the international fora, and advancing ASEAN's common interests. We envision ASEAN having an intensified relationship with its Dialogue Partners and other regional organisations based on equal partnership and mutual respect.

We pledge to our peoples our determination and commitment to bringing this ASEAN Vision for the Year 2020 into reality.

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Location:
The Lao People's Democratic Republic or Laos is located in the center of Indochina. It has an eastern border of 1,957 km with the Socialist Republic of Vietnam, a northern border of 416 with the People's Republic of China, a north-western border of 230 km with the Union of Myanmar, a western border of  about 1,840 km with the Kingdom of Thailand and a southern border of about 492 km with the Kingdom of Cambodia.The country provides a potentially strategic land link for closer sub-regional cooperation in the Greater Mekong area.

With an area of 236,800 square Kilometres. Around 70% of its terrain is mountainous, reaching a maximum elevation of 2,820 m in Xieng Khouang province. The landscapes of northern Laos and the regions adjacent to Vietnam in particular are dominated by hills.

The Mekong river is the main geographical feature in the west and, in fact, forms a natural border with Thailand in some areas. The Mekong flows through 1,865 km of Lao territory and shapes much of the lifestyle of the people of Laos. In the south the Mekong reaches a breadth of 14 Km, creating an area with thousands of islands.

Time:
Time in Laos is 7 hours ahead of Greenwich Mean Time ( GMT* 7).

Climate:
Laos enjoys a tropical climate with two distinct seasons-the rainy season from the beginning of May to the end of September and the dry season from October through to April. The yearly average temperature is about 28 C, rising to a maximum of 38 C in April and May. In mountainous areas, however, temperatures drop to 14-15 C during the winter months, and in cold nights easily reach the freezing point.

The average precipitation is highest in southern Laos, where the Annamite mountains receive over 3000 mm annually. In Vientiane rainfall is about 1500-2000 mm, and in the northern provinces only 1000 -1500 mm.

Language:
Lao language is the national language. Other languages used are French, English. Chinese, Thai and Vietnamese.

Religion:
Buddhism first appeared in Laos during the eighth century AD. as shown by both the Buddha image and the stone inscription found at Ban Talat near Vientiane, now exhibited at the Museum of Ho Prakes. After the foundation of the unified Kingdom of Lane Xang, King FaNgum (14th century) declared. Buddhism as the state religion and urged the people to abandon animism or other beliefs such as the cult of spirits. His policy meant to develop the Lao culture based on a common faith: the Theravada Buddhism. Today Theravada Buddhism is the professed religion of about 90% of Lao people. Buddhism is an inherent feature of daily life and casts a strong influence on Lao society. Lao woman can be seen each morning giving alms to monks, earing merit to lessen the number of their rebirth. Lao men are expected to become a monk for at least a short time in their lives.

Traditionally they spent three months during the rainy season in Vat, a Buddhist temple. But nowadays most men curtail their stay to one or two weeks.

People:
Laos has a total population of 5.2 million (1999), with an average annual growth rate of 2.4 percent. People share a rich ethnic diversity, comprising such groups as Hmong, Khmu, Yao, A'kha, Ikoh, Lu etc. Most of them have kept their own customs, dialects and traditional dress. In total 47 different groups are accounted for in Laos. These can be classified into three broad groups:

1. The Lao Lum (lowlanders) who make up 70% of the population and predominantly live along the Mekong river.
2. The Lao Theung (uplanders) who comprise 20% of the population and live on the lopes and hills with an elevation of  less than 1,000 metres.
3. The Lao Soung (hill tribes) who constitute 10% of the population and live in the mountainous areas.

The population density of Laos amounts to 19-20 people per square kilometre, a small number compared to the country's neighbors. The Lao population lives in 799, 289 households in 11, 386 small villages ( Bans) located in 142 districts ( Muongs ).

Culture:
Lao people boast a plethora of distinctive monuments and architectural styles. One of the most notable structures is That Luang, the Great Sacred Stupa, in Vientiane. Its dome like stupa and four-cornered superstructure is the model for similar monuments throughout Laos. Stupas serve to commemorate the life of  the Buddha and many stupas are said to house sacred relics (Parts of Buddha's boby).

Generally, Hinayana Buddhists cremate the dead body then collected the bone and put in the stupa which up around the temple. Different styles of architecture are evident in the numerous Buddhist vats. Three archtectural styles can be distinguished, corresponding to the geographical location of the temples and monasteries. Vats built in Vientiane are large rectangular structures constructed of brick and covered with stucco and highŒ-peaked roofs. In Luang Prabang the roofs sweep very low and, unlike in Vientiane, almost reach the ground. These two styles are different from the vats of Xieng Khouang where the temple roofs are not tiered.

Religious influences are also pervasive in classical Lao literature, especially in the pha Lak pha Lam, the Lao version of India's epic Ramayana. Projects are underway to preserve classic Lao religious scripts which were transcribed into palm leaf manuscripts hundreds of years ago and stored in vats.

Another excellent example for the richness of Lao culture is its folk music, which is extremely popular with the people throughout the whole country.  The principal instrument is the khaen, a wind instrument which comprises a double row of Bamboo-like reeds fitted into a hardwood sound-box.  The khaen is often accompanied by a bowed string instrument or saw.   The national folk dance is the lamvong, a circle  dance in which people dance circles around each other  so that  ultimately there are three circles: a circle danced by the individual, another one by the couple, and a third one danced by the whole party.

Common Courtesies:
Lao people are frank, open and friendly, and they possess a strongly developed sense of courtesy and respect.  Everyone who adheres to the latter will receive a warm welcome.

The generally accepted form of greeting among Lao people is the nop.  It is performed by placing one's palm together in a position of praying at chest level, but not touching the body.  The higher the hands, the greater the sign of respect.  Nonetheless, the hands should not be held above the level of the nose.  The nop is accompanied by a slight bow to show respect to persons of higher  status and age.  It is also used as an expression of thanks, regret or saying good-bye.  But with western people it is acceptable to shake hands.

When entering a vat or a private home it is customary to remove one's shoes.  In Lao homes raised off the ground, the shoes are left at the stairs.  In traditional homes one sits on low seats or cushions on the floor.  Men usually sit with their legs crossed or folded to one side, women prefer solely the latter.  Upon entering guests may be served fruit or tea.   These gestures of hospitality should not be refused.

Since the head is considered the most sacred part of the body and the soles of the feet the least, one should not touch a person's head nor use one's foot to point at a person or any object.  Moreover men and women rarely show affection in public. It is also forbidden for a woman to touch a Buddhist monk.

Water Resources:
The Lao PDR has large untapped hydropower potential and is situated in a region where electricity demand will likely rise in the long term. There are three medium-scale hydroelectric plants in operation so far, of which Nam Ngum 1 is the biggest with am installed capacity of 150 MW. The three plants, with a combined capacity of 203 MW, reportedly realise less than two percent of the country's hydroelectric potential. In mid-1998, the Theun Hinboon power plant began operation, effectively doubling the country's energy output, with 210 MW of capacity. Agreements have been signed to export 95 percent of this energy to Thailand, with the remaining to be sold within the Lao PDR. Overall, about 70 percent of current hydroelectric power production is exported to Thailand, constituting one of the leading exports of the Lao PDR. Agreements have been signed with Vietnam and Cambodia for future exports of electricity. Development of the country's dydropower resources is seen as a necessity if export earning are to increase in the future. Plas are underway to construct a number of new hydroelectric power facilities, including Nam Ngum 2 and 3, and Nam Theun 2 - the biggest, with an estimated cost of US$ 1.2 billion. Exploitation of natural resources for hydroelectric power production is being carefully evatuated in light of potentially serious environmental implications.

Forest Resources:
Forests cover about 47 percent of the country, comprising a wide variety of commercial tree species suitable for production of sawn timber, plywood, parquet, and furniture. Forest resources represent a major souce of foreign exchange as export of wood products contributes 39 percent of total export earnings. Ninety percent of domestic energy consumption is based on fuel wood. An estimate 400,000 to 600,000 cubic meters of timber are commercially harvested annually or are degraded by shifting cultivation.

Preparations for new hydropower schemes have led to the advance clearing of forests in demarcated reservoir basins. This activity currently represents a major part of total loggingl. In an effort to conserve forest resources, protective measures are being implemented to reduce shifting cultivation, and , to a lesser degree, to manage commercial logging operations, The forests of the Lao PDR have worldwide importance for biogeographic sub-units. The government has extablished about 20 national biodiversity conservation areas covering representative samples of significant plant communities, and is preparing management plans to maintain them.

Mineral Resources:
Deposits of gemstones such as sapphire, zircon and amethyst as well as gold, copper, iron ore and tin are known to exist in the country. Current mining activities consist of extraction of tin and gypsum, mainly used in the domestic construction sector. Exploration for oil and gas has produced limited results. Sizeable lignite and coal deposits are set for imminent development. Exploitation of mineral resources will only be economically feasible if the country's physical infrastructure is improved. A new mining law was passed in April 1997. There is concern among the development community that this law, as currently written, will not provide foreign investors with the necessary incentives to proceed with large-scale exploration projects.

Human Development:
Over 2.1 million people in Lao PDR, almost on-half of the total population, live in poverty. About 1.9 million of the poor are in the rural areas where poverty incidence of 53 percent is more than double that in urban areas, estimated at 24 percent. Among the three regions of the country, the South exhibits the highest poverty incidence at 60 percent. In the rural South, 66 percent of the population, or two out of three people live in poverty.

There are no national unemployment numbers for Laos, but a 1994 survey of five urban centres (Vientiane, Luang Prabang, Savannakhet, Pakse and Thakek) concluded that 5.6 percent of the labour force, the population who are usually economically active, was unemployed. Lack of skilled workers has led to an increase in private sector salaries, particularly for managers, technicians and professiionals.

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