 We're back. This is State Tech. I'm Jay Feidel. This is Energy 808, The Cutting Edge with Marco Mangelsdorf and me. And in a moment, we're going to talk to him seriously and drill down on the subject of what's going on in energy and otherwise in Southeast Asia. Welcome to the show, Marco. It's always nice to talk to you. Welcome back from Southeast Asia. Well, thank you. Thank you. Thank you. Thank you. Thank you. Yeah, it's been a while since you and I have spoken with me actually being home in Hilo. So it's great to be back in Hawai'ine and great to be back with you. Yeah. To me, you stand for the proposition that you've got to get out and travel and you've got to keep your curiosity going. You've got to keep your mind going and you do go. And more often than not, you go to Asia and Southeast Asia and you're just back from a trip to a number of countries there. Where did you go? And why did you go to those places? Well, great question. A little bit of background. So I taught a course last spring at the University of California, Santa Cruz, on the politics of Southeast Asia. Specifically, since there's kind of a differentiation between, when you think of Southeast Asia, I think of the 10 ASEAN country, the Association for Southeast Asian Nations. And those include also island nations like for example, the Philippines, Brunei. And I choose to keep my focus on what's referred to by some as mainland Southeast Asia, which is five countries, makes up half of ASEAN approximately, or not approximately, but exactly in terms of the number of countries. And that includes from the most populous, the least populous, Vietnam, Thailand, Myanmar, Cambodia, and then Laos, bringing up the caboose as far as the smallest country population wise. So I went to all five of those except notable caveat, except Myanmar. I actually got as far as the Myanmar border and Northern Thailand at the border frontier town of Maesai just a couple of weeks ago. And I went to the border crossing, which is over a small stream of the Ruek River, R-U-A-K. And it was completely shut down. So on the Thai side, on the Myanmar side, fences are up. Nobody mans the post, so to speak, because it's been closed since COVID and or since the coup against Aung San Suu Kyi February of 2021. So I decided not to go Gonzo, guerrilla, reporter, and get into to Myanmar. That just didn't seem to me to be very safe thing to do. So we've seen that movie and it doesn't end well. Yeah, yeah, they take hostages there. So I was focused on Thailand, principally Northern Thailand, Laos. Those are the two places I spent the most time. And then also some time in Cambodia and in Vietnam. Fabulous trip. That's the heart and soul of it. By the way, just as a digression, last week we had a really interesting show with a guy named Robert Petit. It's a French name. And we talked to him, he's a lawyer at his office in Ottawa. And he was the chief prosecutor in the Cambodian war crimes against, you know, the successes to Pol Pot and all that. And he had a lot to say about exactly how those war crimes and that trial or trials affected Cambodia. Cambodia is different than the others, isn't it? Well, I mean, Jay, they're they're all unique in their own way. And I mean, what you refer to is this the long going trials of a number of individuals associated kind of the top echelon of the Pol Pot heinous murderous regime. And those under the auspices of the United Nations went on for years and years and years. And you know, the interesting thing about, well, there are many interesting things about each country, but Cambodia attracted a lot of international community attention and a tremendous amount of money. I mean, we're talking billions of dollars after the Civil War there came to an end in the late 1990s. And it is kind of characterized Cambodia. It is an authoritarian strongman state under Hun Sen, who has been in power now since 1985. He's grooming his son, Hun Manet to take over for him at some point. But it's very clear to me that that Hun Sen is still very much attached to being El Primero, the number one there guy by far. And I kind of also put Cambodia in the category of along with Lao being very closely drawn into the orbit of the People's Republic of China, the large neighbor to the north. And especially places in Sienokville along the coast there, Sienokville, which I have no desire to go to. But all the reports I have is that Chinese both clean money and a lot of dirty money have filtered into Sienokville. And it's almost from what I read consistently kind of an outpost of China and human trafficking, prostitution, prisoner type call centers. So Cambodia, Cambodia is kind of a rough and ready country, but interestingly, they've had a lot of economic growth and with China opening up as of a couple of weeks ago in terms of allowing people out, they along with Thailand and Lao, especially are touting the return on mass of Boku Chinese tourists coming for days at a time and spending Boku Yuan Yuan in their local economies. And one of the most interesting things that Robert Petit imparted was that there was a vision, all part had a vision. And the idea was they knew what they were doing. They wanted to kill most of the country, leaving only a remnant of the population. But this remnant of the population would live well. It was a utopian vision, which just happened to include the mass murder of millions of people. I find that really interesting. And they believe that they accepted that and motivated them. That was his plan. Well, it seems like kind of an abomination to refer to anything that went on post that overthrow of the law and all government. And I think it was April issue of 1975 in using the U word as in utopian because there was the antithesis of utopia was the dystopia to the nth degree. And I mean, he wanted to return the country in his own words to year zero, force the forced evacuation of people from the cities such as Benampen. And I mean, it was one of the most heinous regimes of the 20th century. And one of the things that anybody who goes to Benampen or many other places in Cambodia, there are so-called killing fields and museums, which I've gone to one tool slang 21 is was a notorious spot actually in Benampen, which was a school built by the French turned into a place of horrors by by Paul pot after the revolution in 75. And that's I've been there. And it's just it's just beyond words. And there is a killing field not too far out of Benampen, which is easy enough to get to where you can walk and take it all in and see these monstrously large showcases, which is an odd word showcases of human skulls that each represented a living breathing person at some point. So very brutal. You know, there was a play at the Manoa Valley Theater a few months ago, called the Cambodian rock band. And it's believe it or not, it's a musical, but it tells the story of that camp 21 you're talking about, which was the center of a lot of brutality in Cambodia. This is a very interesting play because it's it's mixed with, you know, the brutality, the atrocities, and a hope for a better Cambodia. So you're right. I mean, people have come from all over the world to try to make something of it to improve it. And they've given a lot of money to it. But it carries this legacy around with it. And you know, an interesting backdrop, Jay, is the city of Siem Reap, which is not all that far from from Benampen is the near the largest freshwater lake in all of Southeast Asia, the Tonle Sap, which is kind of a miracle in of itself. And Siem Reap is the the base, so to speak, of the Angkor Wat complex, which if you if you've ever have the time if you haven't already looked into Angkor Wat, it is truly stunning. It's one of the marvels of the world. A community of up to a city of up to a million people back in the day when London was this podunk town on the Thames River that lasted for approximately 500 years from roughly 900 ish to 1400 something. And I got a chance to spend several days there back in November, and it was truly an awesome place to to take in and just kind of one take away to share with you is there was no better engineers, water engineers on the planet than the folks who built the water system in and around Angkor Wat. And what I mean by that is, you know, so much of Asia, Southeast Asia, it has been, you know, the rhythm of life is dictated by two distinct seasons. One is the rainy monsoon season, typically from, I'm going to say June to September, and the other is the dry season. And the key is to be able to take the copious amounts of water that fall from the sky during the rainy season and store it for people to use for agriculture when it's there's very little rain. And they did a masterful job for hundreds of years. They built these huge barai, they call them barai, which is a Kamai ward for reservoirs. And they did a masterful masterful job. What really did them in one of the things that did the place of Angkor Wat in after 500 year run was a series of droughts that went on for approximately 20 years, which brings me or brings us, should bring us to so many parts of the world today. Oh, interesting. You talk about, you know, drought versus flood, and all of that happens in California now, and there are voices being raised about why can't we save the water from the flood and apply it to the drought. That's, as you say, that's a very hard engineering problem. But that's what the world is faced with. And I was going to ask you, how has climate change expressed itself, you know, in these countries that you visited? Well, I'll be happy to answer that question more directly to finish up the story of Angkor because it has to do with water. So after somewhere in the 20 year range of successive droughts, well, the engineers got creative. They were able to make do with less and they essentially fiddled with the infrastructure and the architecture of their water collection and distribution system. And they were able to tough it out. Well, guess what happened after 20 years? Well, we saw a repeat of that in December and January in California. You had torrential rain. I mean, we're talking rain bombs. So that clobbered the engineers and the city's ability to cope after going of 20 years of drought. They went to rain bombs and they thought a massive flooding and an inability to cope. So they tried to deal with that. Well, what happened after the rain bomb? I give you one guess. What happened after the rain bombs? Everything is destroyed. Well, that's a good guess. But the droughts came back again. There were more droughts after a year or two of heavy rains. And so they had to adapt again or try to adapt. And after a number of attempted adaptations, there's still something of a mystery. They decided to evacuate. And this complex, which is truly beyond words and it's their many complexes there in the region, they evacuated. They left. And it wasn't until supposedly a French archaeologist whose name escapes me in the 1800s came across this lost city where you had these incredible ruins that were being taken over by the jungle and monkeys were running wild and so forth and so on. So it's a cautionary tale, I feel, to what we're seeing in many parts of the world now. And, you know, California has been hit by record, record flooding. So what has the water situation? What's going on in Southeast Asia? Well, up until last year, they had suffered through a handful of years of guess what, drought, very low rainfall, low precipitation amounts during the monsoon, which caused the rivers such as the Mekong, which is kind of the the Marquis River, which travels more than 2,000 miles from the headlands in the Himalayan plateau and the people's probably could shine all the way down, snaking its way to empty out the southeast of Saigon, Fuchiman City. So up until last year, which was a relatively normal, in quotation marks, normal rain year, they were maybe there's 70 million or so people who live along the Mekong. There are a bunch more people who live along the many, many tributaries to the Mekong. So it has had a serious impact on the lives of tens of millions of people. And politically and security wise, it has caused tensions between the lower Mekong countries of Laos, Myanmar, Vietnam and Thailand and the people in China, the authorities in China. So there's been a push and pull and pushing on the part of the lower Mekong countries to the Chinese to you need to release more water from your dams. And again, we're seeing this in multiple parts of the world where number one, water is an increasingly scarce commodity. And number two, that is leading to fierce fights amongst the people who for decades or centuries have depended upon the water. Look what's going on in the Colorado River. That's turning into perhaps one of the worst cluster blanks. So one can imagine in terms of water rights and distribution in the United States. So the water situation is critical. They've had a good year last year. So it's kind of less, it's less viable, alarm bell right now, but this is not going to go away. And the tension between the lower Mekong countries and the people's Republic of China is bound to continue. I think you could find a common denominator and say that problems with water, whether it's drought or flood or a combination, a combination is really bad, has a political effect. And furthermore, it has a geopolitical effect. You haven't mentioned Pakistan. Pakistan has had floods, it had drought. Now it has changed its loyalties. And it is buying gas and oil from Putin. And that takes a risk with its relationship with the United States. So, and of course, I think the Prime Minister is stepping down. There'll be new elections. Gee whiz, you know, it's in a state of concern, disruption, and all as a result of the weather. Well, disruption is galore. And another thing that's kind of free associating here, I mean, looks look at Vietnam, one of the most productive and fertile historical and ongoing areas where Vietnam grows rice and rice is a staple food for Vietnamese rice is a staple food for people across Southeast Asia, not only Milan, Southeast Asia, Malaysia, Indonesia, the Philippines, and the issue with lower water, less water coming all the way down, making its way to the Mekong River Delta before it empties into the sea, as the Vietnamese call it. There's less and less water, which means there's more and more infiltration of sailing of salt water, which is having and will have more and more detrimental effect to a major industry and staple food of the Socialist Republic of Vietnam. So, I mean, the consequences of less water across Southeast Asia are monumental, number one. And number two, I can't say I feel very optimistic that there's going to be much of a change as far as the direness of the shortage of water, the distribution of water, the control of water flow. And just to kind of bring this more home for me, my home in Southeast Asia, my heart home, H-E-A-R-T is Luang Prabang, which translated from Lao Ming's Big Buddha, it's right along the Mekong River. And there's a dam being proposed about 20 kilometers upstream of Luang Prabang that's being built by Thai money. And I hired a boat to go upstream to actually see this dam site. And interestingly, just when we happened to be going by, there was a couple people in a safety boat. It had a white flag with a green cross on it. Okay, so we saw it in the distance. There was no water. And this guy comes out with his bullhorn yelling in Lao. It wasn't angry yelling, but he was just letting us know, Hey, guys, there's going to be blasting going on soon. Better get out of the way. So we continued upstream. We waited there and we heard a number of large booms. So this is all part of the excavation and the blasting dynamite to build this dam. And this dam, it is feared by many environs, rightly so, could have a definitely very definite, I said twice now, a deleterious effect on the UNESCO heritage and city town of Luang Prabang. So that's an example of it having very close to home. But I'll also add this shape. The attitude or the knowledge of people in Luang Prabang of this dam is little to nothing right now. And I'm kind of thinking, how can they not be concerned about it? How can they not be aware of this? And it's the very human answer to that. It's because they are dealing with much more proximate concerns and threats to their daily livelihoods. And just to kind of riff on Lao for a minute, last month, December of last month, the Lao government reported that the year over year inflation in Lao, December of 2022 compared to December 21 was close to 40 percent, 40 percent inflation. So that is what really concerns people much more so than some hypothetical dam, which is not so hypothetical, but it's not affecting their lives right now. It's what's in front of them right now and also the continuing after effects of COVID devastating so much of the country's economy. I thought you were going to talk about somewhere in here the development of the economies of these countries, the up-and-coming Southeast Asia, their international connections, their industry, their effort at building tourism, their internal economic strength. But what I hear is that that's really not happening. No, local chair, my friend. There's still a very, very strong focus on tourism. I typically read on a daily basis. I read the press from Thailand, from Lao, and Cambodia, less so in Myanmar because it's hard to get, you know, on the ground objective reporting in Myanmar because it's such a hostile situation there. And less so in Vietnam. I find that the press in Vietnam is usually so. It reminds me of the Soviet days where it's talking about meeting this plan and meeting this particular production level. And it's rather bland for my taste. But I do focus on, like I said, Lao, Vietnam, Lao, Thailand, and Cambodia. And all of them have been giving very prominent coverage to the reopening of China, Chinese tourists coming en masse as the the flight capacity is increased from major Chinese cities. So they are very much, I'm going to say, almost pandering to the Chinese to come, come, come, come, come and spend money, spend money, spend money. So I think that's likely to happen. And especially in places like Lao and Cambodia, where they're already so kind of intertwined in the Chinese orbit, kind of less so in Thailand, but still nonetheless a very big player. This doesn't make me feel all that comfortable about Southeast Asia. I mean, it sounds like Hawaii, pandering for, you know, hospitality guests to come from all over the world. But, you know, in a way you sell your soul. In a way you lose your opportunity of building, you know, internal industry. So query, is it sustainable what they are doing, trying to attract the Chinese travelers? Well, let's look at a few numbers. So pre COVID 2019, the percentage of the economies in at least, I'm going to say Lao, Thailand, and Cambodia. And I don't have the numbers to the penny right off the top of my head. But it's going to be a reasonable assumption to say that the total economies of these three, mainly in Southeast Asian countries, tourism made up between 10 to 20%, probably more like in the 15% range, 15% of the entire economies of Thailand, Cambodia and Lao were based on tourism. That is a big segment. And they want to go back to that from what I can tell. And then some. Now in terms of is it sustainable? I believe that places like Cambodia and Thailand, which are larger countries, are going to be able to probably be, this is kind of a gross generalization, be less impacted. That said, Lao, I feel, being a smaller country, only 7 million Samad people is going to be more impacted. And to make this really real for me, the city of Long Pebong, again, about 15,000 on the Mekong, as of December of 2021, has now a high speed rail line that goes from the southern Chinese city in Hunan province, Yunnan province, excuse me, of Kunming, a train that goes from Kunming all the way down to the Lao Chinese border, Boten, and then down to Vientiane, the Terminus, which is the capital in southern, a kind of mid part of Lao, of the Lao People's Democratic Republic. And up until now, Jay, and I keep track of this because I'm very interested about it, up until now, there's been no people traffic from China into Lao. There's been freight traffic, no people traffic, but it is inevitable, sooner rather than later, that there will be, I'm guessing here, reasonable guess, three to four trains per day from Kunming going to Vientiane, of which those three to four trains per day will stop in Long Pebong, and somewhere somewhere in the, let's say, several hundred people from China, Chinese tourists, will get off in Long Pebong three or four times a day. So let's just do the math. 250 Chinese tourists coming off the train four times a day, that's 1,000 people. They're going to need transportation into town because the train station is out of town along a curly, windy road of about 20 minutes, and they're needed to go places. They'll need to be lodged. They'll want to shop. They'll want to do things. So on this particular instance, it's very real and tangible to me as far as the increase in Chinese coming into Southeast Asia. In this case, Lao, in this case, Long Pebong on the new train, that was paid for 70% debt financing to pay for by the Chinese, or I should say, excuse me, it was paid for all by the Chinese, and it is only 70% by the Chinese on a long-term note that the Lao government will have to repay. It's a note. It means it's a debt, not ownership, but debt. Correct. $6 billion train line. So in this particular instance, and I've spoken to business owners, I've spoken to people on the street there in Long Pebong, and there is there is a level of trepidation and anxiety, not when this is going to happen, as in, excuse me, not if it's going to happen, because everybody knows when it's going to happen, but the impact is going to be on this UNESCO World Heritage Town. And one of my friends who's been there, he's a French expat, went native, married a Lao woman, had a couple of kids, has been living there for, gosh, close to 20 years. And he said, Marco, you got to understand something. People don't do anything here until it smacks them in the face. So there's no planning going on according to him. There's no, there's no real kind of contingency plan as to how to deal with a thousand Chinese tourists coming off the train every single day. So it'll be whopping upside the head when it happens. And then they'll try to figure out what to do with this humongous increase in people coming into this small town. I assume this is part of Belt Road. Oh, yeah. I mean, that sounds like an important part. And the Chinese are, you know, very interested in making it work. But clearly, you know, you have the debt trap problem. These countries can hardly afford to pay that, that, that loan back. And they may come, you know, up to a point where they can't pay it back. And then China will own the rail. Yeah, there's been a fair amount of press about that over the years. And the challenge is, since the BRI Belt Road Initiative has been a hallmark of core leader, eternal leader, Xi Dada, aka Xi Jinping, there is little to no honest, objective, balanced analysis from the Chinese on the kind of pluses and minuses, the balance sheet of BRI. Because coming up with any type of analysis that is somehow challenging or critical of Xi Jinping's hallmark program, it's just not, it's not on the realm of possibility. So I'm not a BRI specialist, I haven't taken a super deep dive into it. But I'm certainly aware of some of the Western literature on it that I've expressed concern. And kind of an interesting tangent, but nonetheless, it's, I think it's very pertinent here. So there's going to be an election in Thailand in May, assuming it goes forward. And just brief type, political history. So Yenlai Shinoat was overthrown by Praiu Chen Ocha, who was, I believe, Army Chief of Staff in 2014. And Praiu, General Praiu, now Prime Minister Praiu, has been in power now since 2014. And there's a lot of maneuvering going on right now with multiple political parties in Thailand. I'm following this very closely. Well, the most popular party, according to the polls, is the Poo Tai Party, PHEU Poo Tai Party. And that is essentially a party of the Shinoat family. First, it was Toxin Shinoat, who ran in, I believe, 2001, one in the landslide that he won re-election four years later in 2005. He was overthrown by the military in 2005, and he's been in exile ever since. So now, get this, his daughter, whose nickname is Ng Un, Ng Un, she is all of 35. She is now the Poo Tai Party Prime Minister candidate. And like I said, their party, that party is by far ahead in terms of the polls. And if you look at the platform of the Poo Tai Party, it reads like an incredible laundry list as far as pandering. Pandering is so many parts of the Thai populace and the Thai political structure. But one of the things that really caught my attention, I was scrolling down all the things they were promising, all elect us, and this is what you can get from us, is that Poo Tai is making very clear that they want to work more closely with China in terms of infrastructure projects, and they explicitly voice support for continuing this high-speed rail, which now the terminus is VNTN, which is just on the Laos side of the Mekong in that particular part of Laos and Thailand. And the plan or the thought has been over the years to continue that across the Mekong and have it go all the way to Bangkok and South to the Gulf of Thailand, which is what the Chinese very much want to see because that'll give them further access. They'll give them open ocean access. So the ties have been very kind of squirrely on this to some extent because they don't want to get in debt with the Chinese, and it's not going to be the same deal as Laos government had to submit itself to, to get the rail line from Kunming to VNTN. So it's going to be a different beast, but I found it very interesting that this most popular according to the polls political party in Thailand is saying we want closer relations with China. We want to continue the rail line, which we're talking if they say yes, it's going to be I don't know five to eight years that it would actually take to go online. So still a big question marks can take a lot of money, but I found it very interesting that China and the relationship with Thailand and China is very much in the top tier of political subjects when it comes to Thai politics. Well, it sounds like a kind of Belt Road imperialism, if you will. It also sounds like maybe a bit of corruption is in play here. Don't you think? Oh, you had to use the C word. Well, there is and there are a number of what I believe to be impartial and objective international rating organizations that will look at countries and rate them in terms of levels of transparency and corruption. So I looked into this in some detail when I taught my course and I don't have the numbers off the top of my head, but I can not going to surprise you when I tell you that the countries of Southeast Asia do not rank very high on the transparency and open honest government scale. So yeah, I mean, it's just a fact of life. You've got a one-party communist party dominance in Laos. It's the same in China. You've got one family rule in Cambodia, me and Mars, the mix, you know, it's a military hunch of this doing atrocious, heinous things to its people. And then who did I leave out here? Oh, Viet, Cambodia, one party rule or one one man rule. I think I've nailed them all. Well, spending billions on a project, you know, it's kind of built in to peel off a few bucks, you know, to get people on your side of the project. It's just no reason why not, actually, in at least in that part of the world. But let me let me let me go to one thing and it's I'm sort of building a curiosity on this. You go because you teach a course in California, you go because you're an energy guy, you spent your, you know, your career in energy and politics guy to your politics guy, the politics of energy, as a matter of fact, you go because you're curious, you go because you know people and you go because you like the cultures that they're meaningful. You go because it's kind of the last great relatively civilized frontier in the world to visit. You go for the creature conference, which I'm sure are available in all of those countries in their own way. And you go to get away. What did I miss? Well, you pretty much nailed it. Jay, you pretty much nailed it. I think I'll just add that, you know, in terms of curiosity, a corollary to curiosity is the desire to know and to learn more, to learn more. And it was really kind of fascinating. I wasn't planning to be up in far North Thailand, far Northern Thailand. It was kind of last on a spur of the moment thing, but I said, you know, I'm here, I should go check out Shangrai, which is farther north and Shangmai, and even go further north from Shangrai to Mesa, which is the border with Myanmar and Laos and the so-called Golden Triangle. And so I went up there and I was immensely drawn to the region. And even though it's kind of interesting, even though it was time for me to come home after three plus months on the road. So I felt filled to the brim, okay, filled to the brim. It wasn't one of these feelings of, oh, I wish I would have had more time here or there. So I came home at a perfect time, and I'm already planning my next trip later this year, because one of the things I've learned is that I can really only handle Southeast Asia too much to the year. And those are December and January. Why? Because the rest of the year, it is so darn hot. And I wilt in the heat. So to wrap that up, I mean, I just, there's more for me to learn, you know, and it's a fascinating part of the world. I can't go to every part of the world and learn, learn, learn, because I'm fine. I like the rest of us, but I have a particular interest in parts of Southeast Asia, so I feel very blessed. Yes, I mean, you should. Travel is broadening. We always knew that, but we don't, you know, Americans don't play that the way perhaps they used to. You know, I'm thinking of the Peace Corps, people who are hungry to find other places and learn about them, adopt them, and fold them into their own worldview. And you've done that. And it's a message to all people, young people especially, to get out and make these trips to learn about it and have a maybe an effect on it, but in any event express the curiosity that you're talking about. I hope you do it again and again. And I hope when you come back each time that we can, we can visit together like this, then you can tell us your impressions. Well, thank you. And I hope that you write it up a little bit too. Well, and with the magic of the internet, which is pretty much everywhere I went, so rather reliably, fortunately, since I'm so tethered to keeping in touch and to working from afar, is we can do shows from places like Shanghai or Maesai, or, you know, within sight. The Golden Triangle is kind of cool because you can see Laos on the other side of the Mekong, and you can see Myanmar on the other side of the Ruik River. So yes, here, here. Thank you so much for having me. Thanks for coming on, Marco. This has been a great discussion. I really appreciate it. Marco Manglisdorf, our co-host on Energy 808, The Cutting Edge, and more. Thank you so much. Talk to you soon. Thank you. Aloha. Thank you so much for watching Think Tech Hawaii. If you like what we do, please like us and click the subscribe button on YouTube and the follow button on Vimeo. You can also follow us on Facebook, Instagram, and LinkedIn, and donate to us at ThinkTechHawaii.com. Mahalo.