US embassy cable - 05HANOI1052

UNCLAS SECTION 01 OF 02 HANOI 001052 
 
SIPDIS 
 
STATE FOR EAP/BCLTV 
 
E.O. 12958: N/A 
TAGS: PREL, PGOV, VM, HUMANR, ETMIN, CVR 
SUBJECT: Ambassador Views Development in NW Highlands 
 
1.  (U) Summary: Vietnam's Northwest Highlands region 
remains among the country's poorest, and is faced with 
challenging and inaccessible terrain, a majority population 
of Vietnam's ethnic minorities, few natural resources or 
arable land, and low population density.  Leaders of Dien 
Bien, Lai Chau and Lao Cai Provinces described development 
plans to the Ambassador during his visit to the region April 
20 to 23.  The provinces are mostly focused on providing 
basic infrastructure, such as road access, education, 
electricity, health clinics and drinking water, to all of 
their communes.  Industrial development largely consists of 
hydroelectric plants and a handful of mining projects.  The 
region is also seeking to develop links with western China, 
both for trade in goods and also as a transportation link 
along the Red River valley and to Haiphong.  Religion and 
narcotics issues in the Northwest Highlands will be 
addressed septel.  End Summary. 
 
The Northwest Highlands 
----------------------- 
 
2. (U) Vietnam's Northwest Highlands are a less clearly 
defined area than the Central Highlands.  Northern Vietnam 
is circled by mountains from Son La Province due west of 
Hanoi to Quang Ninh on the east coast.  All these provinces 
are similar in that they are mountainous, have a large 
population of ethnic minorities and are economically 
underdeveloped.  The Northwest Highlands generally refer to 
the provinces of Dien Bien, Lai Chau, Lao Cai and Ha Giang, 
which are further from the Red River delta and suffer from 
particularly severe poverty.  These provinces consist 
largely of mountains and steeply sloping valleys with little 
arable land.  They also contain a preponderance of ethnic 
minorities in almost all areas aside from the Red River 
valley, which cuts through Lao Cai Province before widening 
into the delta further downstream. 
 
3. (U) Dien Bien People's Committee Vice Chairman Bui Viet 
Binh told the Ambassador that Dien Bien Province has a 
population of 450,000 and is composed of 21 different ethnic 
groups.  The province is 40 percent Thai, 28 percent Hmong 
and 20 percent Kinh.  Binh claimed the province enjoys ten 
percent annual GDP growth, which it aims to raise to 12-15 
percent in 2005.  Dien Bien was created through the division 
of Lai Chau Province in November 2003. 
 
4. (U) Lai Chau People' Committee Chairman Nguyen Minh Quang 
described his province as the "most distant" and facing the 
"most difficulties" in Vietnam.  Most of the province's 90 
communes are included in the GVN's Program 135 poverty 
alleviation plan.  The province's 230,000 inhabitants are 
largely Thai, with Hmong and Dzao ethnic groups also 
prominent.  The Kinh Vietnamese constitute only ten percent 
of the population.  Quang described the ethnic minorities as 
being poor and poorly educated, but also "slow to adopt new 
technologies and techniques." 
 
5. (U) Lao Cai People's Committee Chairman Bui Quang Vinh 
marked his province as "among the six poorest in Northern 
Vietnam."  Of the province's 164 communes, 125 are "in 
difficulty" and 80 percent of the province's population of 
640,000 lives in these areas.  Poverty alleviation programs 
have lowered the number of residents below the poverty line 
from 30 percent to 8.4 percent, but this will likely rise 
again if Vietnam reassesses its poverty line, as it is soon 
expected to do. 
 
Regional Development: Focusing on the Basics 
-------------------------------------------- 
 
6. (U) Overseeing development in the Northwest Highlands is 
a Central Government Steering Committee, led by the head of 
the Economic Commission of the Communist Party's Central 
Committee.  Dien Bien, Lai Chau and Lao Cai often band 
together to make requests for development assistance from 
the GVN, and provincial development programs are focused 
largely on extending basic infrastructure and services to 
all citizens.  Lai Chau hopes to provide access to 
electricity to 80 percent of households by 2010 (up from 40 
percent today) and Dien Bien has extended electricity to 60 
of its 88 communes.  Lao Cai is trying to provide small 
hydroelectric generators to those communes not linked to the 
national electric grid, and the province is currently able 
to provide access to 70 percent of villages by car.  For its 
part, Dien Bien hopes to provide road access to all of its 
88 communes by 2005.  Dien Bien and Lai Chau each have three 
hospitals, fewer than one for each administrative district. 
Dien Bien claims to have followed GVN instructions and 
programs to spread awareness of the threat of HIV/AIDS and 
to control for avian influenza.  Lai Chau has a growing 
HIV/AIDS problem "connected to tourism," and the province 
has 393 registered HIV positive patients, up from six in 
1996. 
 
7. (U) All three provinces have placed a particular focus on 
education.  Dien Bien has built at least one primary school 
in all of its communes and has 16 secondary schools, a 
teacher's college and a nursing school.  In addition, each 
district has a boarding school for ethnic minority students. 
Lai Chau is focusing on the construction of schools and the 
assignment of teachers to remote areas and hopes to have 
primary education available to all children by 2009.  The 
province also benefits from a special GVN program for the 
construction of schools for ethnic minorities. 
 
8. (U) At Dien Bien's premier provincial-level boarding 
school for ethnic minority students, the school Director 
explained that students previously had been referred by 
district People's Committees.  In 2004, an exam system was 
introduced to select entering students, but the school still 
undertakes to ensure that different ethnic groups and 
regions are represented.  Some of the arriving students need 
"Vietnamese language improvement courses" in addition to 
their regular classes.  Graduates largely go on to positions 
in the provincial government.  In the most recent graduating 
class of 100 students, 46 went on to further study, many of 
them in special Government programs reserved for ethnic 
minority students.  Approximately 33 percent of the school's 
students are female. 
 
Economic Opportunities: Tourism, Mining and China 
--------------------------------------------- ---- 
 
9. (U) Industry in the Northwest Highlands largely consists 
of hydroelectric dams and some mining projects.  Dien Bien 
contains three hydroelectric power stations as well as some 
coal mining.  Lai Chau has one hydroelectric station and is 
planning two more.  Lai Chau is hoping to develop its mining 
sector through a joint venture slate quarry already in 
place; the possibility of developing a gold mine with 
foreign investors is also being explored.  The Lao Cai 
People's Committee Chairman told the Ambassador that he 
hopes to develop mining and hydroelectric projects, although 
he did not point to specific examples.  Lai Chau authorities 
noted that the construction of new dams will displace a 
number of individuals, as will the reservoir of the Son La 
Dam in neighboring Son La Province.  However, this is being 
done in accordance with national policies on compensation 
for displaced individuals, they promised. 
 
10. (U) Lao Cai sees opportunities for development of 
tourism thanks to its border gate with China's Yunnan 
Province, the old French hill station resort of Sapa and 
opportunities for tourists to visit ethnic minorities. 
Ethnic minorities have also begun producing handicrafts 
specifically for sale to tourists in Sapa and Hanoi, helping 
to reduce poverty levels.  Lao Cai hopes to develop the "Red 
River economic corridor" running from Haiphong through Hanoi 
and Lao Cai to Kunming in China.  The province is developing 
a horticulture project in partnership with an American 
investor and focused on developing flowers for export north 
to China, or down to Haiphong for transport to Japan. 
 
11. (U) Lai Chau also looks to China for economic 
opportunities.  Lai Chau had 300 billion dong (19 million 
USD) in exports through its border gate in 2004, largely 
cashews, rubber and frozen seafood transported from other 
areas in Vietnam.  The province is also encouraging 
districts to cooperate with their counterparts across the 
border on issues of regional concern. 
 
Village Life Slowly Improving 
----------------------------- 
 
12. (U) In two ethnic Thai minority villages, local leaders 
told the Ambassador that their populations are growing 
rapidly.  Both villages have Party cells in addition to an 
elected village chief: in one village, the chief has served 
twenty years, while the second village's leader is newly 
elected.  The State provided healthcare, electricity and 
primary education to children of both villages, which are 
relatively accessible by car.  Economic growth in one 
village had allowed many families to acquire a bicycle and 
television.  Despite these improvements, both villages 
largely exist on substance farming, and leaders cited 
maintenance of irrigation water supply as their key concern. 
 
MARINE