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Cablegate: Cross-Border Movement of People Expands with Greater Mekong

VZCZCXRO5313
PP RUEHCN RUEHDT RUEHGH RUEHHM RUEHVC
DE RUEHCHI #0169/01 3120751
ZNR UUUUU ZZH
P 070751Z NOV 08
FM AMCONSUL CHIANG MAI
TO RUEHC/SECSTATE WASHDC PRIORITY 0881
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHOO/CHINA POSTS COLLECTIVE
RUEHCHI/AMCONSUL CHIANG MAI 0956

UNCLAS SECTION 01 OF 03 CHIANG MAI 000169

SIPDIS

E.O. 12958: N/A
TAGS: ECON ECPS EINV ELAB ELTN ETRD PREL EWWT BM CH
LA, TH
SUBJECT: CROSS-BORDER MOVEMENT OF PEOPLE EXPANDS WITH GREATER MEKONG
HIGHWAY

REF: A. A. CHIANG MAI 73: CHINESE LANGUAGE STUDY RISING IN NORTHERN THAILAND, BUT NOT SUPPLANTING ENGLISH
B. B. 07 CHIANG MAI 166: GATEWAY OR SPEED-BUMP? NORTHERN THAILAND AND THE
KUNMING-BANGKOK CORRIDOR

CHIANG MAI 00000169 001.2 OF 003


Sensitive But Unclassified; please handle accordingly.

-------------------
Summary and Comment
-------------------

1. (U) With the Greater Mekong Subregion (GMS) highway
infrastructure project nearing completion, movement of persons
and trade in services - not only trade in goods - across the
northern Thai border is increasing. While the number of persons
entering Thailand at Chiang Khong, the border point for the GMS'
R3A North-South Corridor highway, has increased by over
one-third since 2006, the number of people entering Thailand via
the nearby Mekong river port of Chiang Saen has dropped.
Moreover, relatively better Thai medical services are attracting
Burmese and Laotians into northern Thailand; while business
opportunities and appealing tourist destinations are pulling
Thais northward across the border.

2. (SBU) Comment: For Thai experts who monitor GMS
developments, services are a promising competitive advantage for
northern Thailand, where wages and education levels tend to be
higher relative to neighboring eastern Burma, northern Laos, and
southern China. Despite increasing cross-border mobility of
people, a surprising trend has been the increasing movement of
Thai tourists into China rather than the over-estimated number
of Chinese tourists to Thailand, which has been relatively low.
Moreover, the number of students entering Thailand for study
abroad from the region remains low, despite the relatively
higher quality and quantity of higher education institutions in
northern Thailand. Unlike medical services, the tourism sector
in northern Thailand cannot take for granted such an advantage
when China, Laos, and even Burma are offering equally or more
desirable tourist destinations. For education, northern
Thailand could stand to improve its accessibility to non-Thais
with expanded international programs. End summary and comment.

--------------------------------------------- ------
With Better Land Transport, More Thais Travel North
--------------------------------------------- ------

3. (U) The overall movement of people for tourism, business, and
study abroad through the Chiang Khong land port has increased in
recent years thanks to the construction of the R3A, a highway
that connects central Thailand to southern China via Laos, also
known as the North-South corridor. (Note: The R3A highway is
completed with the exception of a bridge that will connect
Chiang Khong to Huay Sai, Laos in 2012.) The Chiang Khong
Immigration office told Econoff and EconLES during a trip to the
border region that the number of people crossing this Thai-Lao
border point has doubled from an average of 300 persons per day
in 2007 to 600 persons per day this year. Thais and westerners,
mainly tourists in both cases, accounted for 70% of those
entering Thailand via Chiang Khong in 2007. For Thai travelers,
both exit and entry through Chiang Khong has increased in recent
years both by passport-holders and by Thai-Lao border-crossing
cardholders.

4. (U) While accessible land transportation has increased
traffic through Chiang Khong via the R3A, the numbers of people
passing through the nearby entry points of Chiang Saen and Mae
Sai have declined slightly or remained unchanged. At Chiang
Saen, the main Mekong river port, the bulk of people crossing
the border are Thais going to and from casinos across the river
in Laos. Thais, mainly gamblers, make up about 80% of those
entering and exiting at Chiang Saen; immigration officials
report that the number of people crossing there has dropped
slightly because of fewer marketing incentives offered by the
casinos in recent years. At Mae Sai on the Thai-Burma border,
Burmese cross into Thailand for medical services and tourism
while Thais cross into the adjacent city of Tachilek to set up
businesses in the local market (see para 7). At Mae Sai,
border-crossing remains very high with over 4,000 entering
Thailand each day according to local immigration officials.
(Note: At Mae Sai, many merchants cross back and forth more than
once daily; each crossing is counted, even if the same
individual crosses more than once per day.)

--------------------------------------------- -------------
Mobility Fueled by Thai Tourists, Not Tourists to Thailand
--------------------------------------------- -------------

5. (U) According to immigration officials along the northern
border, Thai tourists are traveling across the border, primarily
to southern China, more frequently, while fewer than expected
numbers of Chinese tourists are entering northern Thailand.
Immigration officials report that Thai tourists are attracted to
cities such as Jinghong in southern China, which is culturally

CHIANG MAI 00000169 002.2 OF 003


similar to northern Thailand; and, most recently, elderly Thai
tourists see the region as a safe alternative to the
Thai-Cambodian border which remains tense due to the Preah
Viharn conflict. This year, only 7.2% of those who have entered
Thailand via Chiang Khong (or 2,443 people) are Chinese.

6. (U) The President of the Chiang Rai Chamber of Commerce said
that while the northern Thai tourism sector has been optimistic
about a flood of Chinese tourists after the completion of the
R3A route, the reality has been more and more Thais going to
China as tourists. He said that the northern Thai tourism
sector will have to work harder to market itself in southern
China and the Mekong subregion as a tourist destination. Having
recently returned from a recent Chamber of Commerce organized
road-trip on the R3A, the President of the Chamber said that in
many ways southern China's tourism opportunities are of better
quality than northern Thailand's, meaning the region will have
to work harder to be competitive in this economically important
sector. (Comment: His statement underlines the need for
northern Thailand to diversify its economy beyond its current
pillars of tourism and agricultural, both of which are seasonal.)

--------------------------------------------
Thai Business Owners Increase Border Traffic
--------------------------------------------

7. (SBU) Another way that Thais are pulled northward is the
opportunity to set up businesses in the neighboring countries.
This is most evident in Mae Sai and the adjacent Burmese city of
Tachilek in Shan state. Both cities have bustling Chinese goods
markets which attract consumers from around the region. While
it is not surprising that most of the small businesses operating
in the Mae Sai market are Thai, it is noteworthy that, according
to Mae Sai immigration officials, an estimated half of the
businesses operating in Tachilek are also Thai owned. According
to those officials, another 30% of businesses in Tachilek are
owned by the Hompang Company, a United Wa State Army controlled
business; and the remaining 20% are owned by Burmese
individuals.

8. (SBU) Most of these Thai business owners reside in Mae Sai
and move across the border daily to maintain their
Tachilek-based businesses. Thai immigration officials reported
that recent intelligence suggests the Wa have resumed control of
Tachilek over the past two to three months, and it is assumed
they take fees or bribes from Thai business owners operating
there.

--------------------------------------------- ----------
Medical Services: A Successful Pull-Factor for Thailand
--------------------------------------------- ----------

9. (U) While various factors push Thais north across the border,
fewer than expected good but affordable services are in place to
pull non-Thais into Thailand. One successful example, however,
is Thai medical services. Hospitals in Chiang Khong, Chiang
Saen, and Mae Sai all reported that they provide services to
Burmese and Laotians who cross into Thailand seeking healthcare.
At the Chiang Khong Hospital, Laotians make up about 12% of
out-patient cases and 14% of in-patient cases. According to the
hospital director, the numbers of Lao patients have increased by
about 5% in the past year. The hospital attributes this trend
to the lack of a medical welfare program in Laos and the higher
quality of medical care in Thailand. The hospital reported that
in only a few, rare cases did Laotians leave without paying for
their services.

10. (U) In 2007, the Chiang Saen Hospital received 5,800 Lao
patients and 649 Burmese patients, nearly 10% of the total
patients for the year. (Note: An estimated 28,000 Laotians live
across the Mekong River from Chiang Saen.) The hospital
director estimates that almost all of these are laborers working
in Thailand and about half of them are unregistered, illegal
workers. The director said that when registered, a foreign
worker can receive medical welfare benefits; but unregistered
patients must pay for the services rendered. An important
advantage for this hospital is its HIV-AIDS treatment program,
for which non-Thai patients can receive financial assistance
from the Global Fund for AIDS, Tuberculosis and Malaria.

11. (U) The Mae Sai Hospital has been most successful at
leveraging its geographic location in the Greater Mekong
Subregion. With 30% of its patients being Burmese, many of whom
pay out-of-pocket for services, the hospital recognizes not only
the high demand for good medical services from neighboring Burma
but also the revenue that middle-class Burmese from adjacent
Shan state bring to the hospital. The Mae Sai Hospital reported
that it is one of the strongest revenue-generating public
hospitals in Thailand because of its Burmese patients.


CHIANG MAI 00000169 003.2 OF 003


12. (U) One example of how the Mae Sai hospital has embraced its
strategic location in the GMS is its establishment of the
Greater Mekong Subregion Medical Training Center. Sponsored
partly by the Royal Thai Government's Ministry of Public Health
and the Japan International Friend and Welfare Foundation
(JIFF), this center provides training to prospective doctors and
nurses from the Mekong region. Over the past year, the center
conducted its first program, offering a series of four training
courses to 35 participants from Thailand and Laos. Next year,
five Burmese students will join the program, and the center
hopes to include Vietnamese participants in subsequent years.

13. (U) This cable was coordinated with Embassies Rangoon and
Vientiane and Consulate General Chengdu.
MORROW

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