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