Low wages and soaring inflation push Laotians to Thailand — Radio Free Asia
Hundreds of Laotians queue daily outside the Lao Foreign Ministry in Vientiane to apply for or renew their passports so they can travel to neighboring Thailand, where they hope to find better-paying jobs and escape crippling inflation at home.
Laotians say it has become increasingly difficult to earn a living in their country, given the rising prices of gasoline, food and daily necessities. A government plan to raise the country’s monthly minimum wage from 1.1 million kips ($75) to 1.3 million kips ($88) is unlikely to be enough to keep workers at home.
“How can we live with a salary of 1.3 million kips in the current situation? asked a worker at a garment factory in Savannakhet province, adding that the minimum monthly wage should be at least 2 million kips ($150) because consumer prices have doubled.
“The increase is too low and the wages are too low,” he told RFA on Thursday. “As soon as I have my passport, I go to Thailand where the salary is three times higher.”
Laos’ inflation rate stood at 12.8% in May – one of the highest in Southeast Asia – with a record 9% increase in the first five months of the year compared to the same period in 2021, according to the Laos Bureau of Statistics. The lack of fuel and the continued depreciation of the kip are responsible for the spike in inflation.
“The Lao currency, the kip, is now floating and continuously losing its value,” said a factory worker in Champasak province in southern Laos. “The government should consider the financial and economic situation while raising the minimum wage. Salaries must be balanced with the cost of living.
Prime Minister Phankham Viphavanh’s office announced on June 13 that the monthly minimum wage will increase to 1.2 million kips ($81) on August 1. On May 1, 2023, it will increase to 1.3 million kips.
“The government will accelerate efforts to resolve the fragility of the macro-economy and normalize the situation,” Phankham said Monday at the opening of the third ordinary session of the Lao National Assembly, according to the local newspaper. Vientiane time.
A member of the Laos Federation of Trade Unions said his organization had asked the government to raise the minimum wage to 1.5 million kips ($101) per month, but officials refused.
“Inflation is too high and the prices of all food and other products are skyrocketing,” he told RFA. “The minimum wage is not enough for all living expenses. It might be enough for fuel only, but not for food.
Some government officials at the provincial level also lamented the wage situation.
“A salary of 1.3 million kips is too low, especially in the current situation. We cannot live on this kind of income,” said an official with the Labor and Social Welfare Department of Luang Namtha province in northern Laos.
The central government has increased the monthly minimum wage twice in the past seven years, in 2015 when the wage was 626,000 kip and in 2018 when it was 900,000 kip.
Queuing for passports
Current economic circumstances have prompted Laotians of working age to travel next door to Thailand for better paying jobs.
A Lao worker in Vientiane told RFA that over the past few weeks he had observed around 500 to 600, mostly young people, waiting outside the Ministry of Foreign Affairs every day to submit passport applications, although the ministry does not handles only 250 to 300 applicants.
People arrived at the building the night before and slept on the sidewalk to ensure they would return the next day, he said.
“It’s crowded – crowded,” a young Laotian man queuing to apply for a passport said Thursday. “The number of people queuing is increasing. I’ve been queuing since dawn.
Authorities are now accepting around 500 applications a day, down from 300 a few days ago to ease long waits, he said.
Another passport applicant from Savannakhet province said there were long queues at the ministry as there was no online application process.
Sisouphanh Manivanh, deputy director of the consular department of the Ministry of Foreign Affairs, which processes passport applications and renewals, told RFA on Tuesday that more citizens have started applying for passports after the reopening of its borders in Laos in Maydue to restrictions related to the COVID-19 pandemic.
The department is adding more staff and asking them to work overtime so they can accept more applications daily, he said.
Meanwhile, Lao workers are struggling with soaring prices for gasoline, food and everyday necessities, which have nearly doubled as the kip depreciates against the Thai baht and other foreign currencies over the past five months.
“Everything is bad now,” said a worker. “Our currency has depreciated and the Thai baht is strong. We can earn at least US$10 a day in Thailand, and every month if we earn US$300, that means we get about 5 million kips a month.
The Savannakhet factory worker told RFA that the majority of young people in the province prefer to go to Thailand to earn more money.
“About 1,000 Thai baht is more than 500,000 Lao kip or US$30, so it’s better than Laos now,” he said. “We are facing shortages of gasoline, and it is also very expensive [in Laos].”
Since the land borders between Laos and Thailand were fully reopened on May 9, more than 2,000 Laotians have crossed the border daily compared to only 300 people in the first two weeks, according to a report published by Thai customs officials on May 7. June.
Crossing to Thailand
Not everyone travels to Thailand looking for a job. Lao tourists and commodity traders have also increased the number of people crossing the border, said a border guard from Nong Khai province in northeast Thailand.
“We see around 1,000 to 1,500 Laotians entering Thailand [at Nong Khai], and there are over 2,000 people on weekends,” he said. “They come for all the reasons, and some of them are tourists and migrant workers.”
More and more Laotians looking for work are crossing the Mekong River to enter Thailand, due to the country’s poor economy, said an official from Savannakhet province, which borders Thailand to the east.
“Now more and more people are crossing the Thai border to find jobs because it’s convenient,” he said. “The cost of living in Laos is rising, the Lao kip is depreciating and the minimum wage is still the same. That’s the reason.”
An official from Khammouane province, north of Savannakhet, said he noticed that Laotians applying for new passports mainly travel to Thailand in the hope of finding work due to the rising cost of living in Laos. and currency depreciation.
“We are seeing more and more people applying for new passports because they are migrant workers. Many of them go to Thailand because the economy of Laos is not doing well and the monthly salaries are low and the value of our currency is also low.
Translated by Phouvong for RFA Lao. Written in English by Roseanne Gerin.