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Losing ground: the political economy of dependency and development in the Lao People’s Democratic Republic

Souvannaseng, Pon Phornchanok (2019) Losing ground: the political economy of dependency and development in the Lao People’s Democratic Republic. PhD thesis, The London School of Economics and Political Science (LSE).

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Abstract

This thesis offers a detailed study of the disadvantages of post-Cold War late development at the confluence of shifting regimes of development finance. As Lao PDR emerged from relative isolation at the end of the Cold War, it was quickly integrated into a Bretton Woods-led regional and global development regime that was itself undergoing a shift from aid to private-sector led development. This thesis contends that liberalizing reforms initiated by the Asian Development Bank and driven further under the aegis of the World Bank in its bid to re-enter the global hydrolending landscape through its landmark NT2 project in Laos led to the introduction of tools of modern finance into contemporary Lao infrastructure building. Seemingly small and innocuous institutional innovations brought to Laos and installed by OECD-DAC agencies, some for the purposes of environmental conservation, led to perverse outcomes and momentously facilitated a watershed of financialized regional infrastructure investment by state-coordinated business groups from neighbouring Thailand, Malaysia and China in the aftermath of the Asian (1997) and Global (2008) financial crises. The installation of financial instruments and practices by Bretton Woods institutions intending to further the public-private-partnership (PPP) paradigm and business interests of corporations established in OECD states has instead paved the way for the expansion and deepening of financial markets in the name of development led by emerging Asian business actors eager to transition from ‘national champions’ to international powerhouses. This historical account demonstrates both continuity and change as the neomercantilist aspirations of East and Southeast Asia’s emerging economies beneficially utilize the liberalizing environment spearheaded by Bretton Woods institutions to further their own interests while creating parallel governance institutions and divergent lending and environmental practices to the Development Assistance Committee. Based on over fifteen months of in-country research and interviews, this thesis sheds light on the ways in which state elites internalize ideologies of development in pursuit of autonomous economic development while reinforcing conditions of dependency through external economic reliance. Building on insights gleaned from early dependency scholars, this thesis provides a critical contribution by adapting their observations concerning constraints to development for a post-Bretton Woods development landscape which has shifted from MNC-led industrial investment to finance-driven portfolio investment. In doing so, this thesis upends the traditional ‘centre-periphery’ framing of asymmetric exploitation by introducing the notion of ‘proximate dependency’ to capture the pernicious dynamics of exploitation between (post-WWII) late developers and their even later (post-Cold War) brethren, cutting against popular discourses of south-south development.

Item Type: Thesis (PhD)
Additional Information: © 2019 ‘Pon’ Phornchanok Souvannaseng
Library of Congress subject classification: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HG Finance
J Political Science > JQ Political institutions Asia
Sets: Departments > Government
Supervisor: Lin, Chun and Woodruff, David
URI: http://etheses.lse.ac.uk/id/eprint/3935

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