As an acute visitor to Laos noted recently, there's something happening here, but what it is ain’t exactly clear.

Judging by comments from a cross-section of natives of that strange and rather off-the-radar country, they too aren't exactly sure what is going on, but they certainly believe it's for the best. And they're right.

To understand why, it's necessary to go back to March, 1961, when newly elected US president John Kennedy was told by Winthrop Brown, his ambassador in Vientiane, that Laos was hopeless.

It was barely a country, wailed Brown. The king was useless and the general the US was backing had never been near a battlefield.

The people were genial, easy-going and enchanting. “They’re just not very vigorous,” Brown told Kennedy.

As if that weren't enough, the ambassador’s lament followed former president Dwight Eisenhower warning his successor that Laos was the critical “cork in the bottle” for Southeast Asia.

According to Ike, if Laos blew, the whole region would go down the tube.

Kennedy was flummoxed and annoyed: how could Laos be so strategically crucial, yet so utterly worthless at the same time? Of course, it wasn’t either. It was just Laos. There’s no place like it.

Yet these observations half a century ago had a certain serendipitous validity.

The charming people of Laos have always exhibited a certain languid detachment from the sordid quotidian of worldly affairs – and have benefited immensely from it.

But over the past decade or so, the country’s strategic and economic values have been re-appraised by global and regional powers and found to be pretty impressive.

Consequently, things have suddenly begun to happen in laid-back Laos. At first, they were barely noticed, but recently they have gathered such pace and magnitude that everyone has begun

to sit up and take notice.

The incipient transformation began in 1997, when Laos joined ASEAN. It was a move not everyone supported.

Singapore’s grizzly old sage, Lee Kuan Yew, chastised the association, saying that backward nations like Laos weren't ready to join. He scathingly dismissed the place as an outpost for China and claimed that Vientiane told Beijing everything that was said at ASEAN meetings.

It was a typically daft objection, given that Cambodia and Myanmar were doing the same, and the fact Singapore always reports back to Washington.

But Lee’s farts in the wind were ignored and Laos became a full member of the group 15 years ago.

That put it on the regional map, as did the decision to start work on the huge Nam Theun 2 hydro-electric dam, which now supplies electricity to Laos and Thailand.

Vientiane is moving ahead with the even bigger Xayaburi hydro project and has plans to build 20 power plants within the next decade, all of which will bring in tonnes of dosh to the nation’s coffers – just as its mining projects already do, particularly the huge gold and copper mines run by MMG and Pan-Aust.

The biggest change of all came when the World Trade Organisation approved Laos’s membership in October.

Being in the WTO will give a greater thrust to Vientiane’s plans to institute economic and legal reforms.

Soon after, it was announced that Malaysia’s Giant Consolidated will begin work next month on a $5 billion, high-speed railway linking southwest Savannakhet with Vietnam’s Lao Bao.

That followed the approval of a high-speed rail project connecting Vientiane to China’s Yunnan and a $29 million loan from Bangkok to construct a road into northwest Thailand.

These moves are all part of a mammoth initiative to make landlocked Laos a transport hub for the region.

So, finally, the sleeping backwater may become the cork in the bottle after all.

Contact our regional insider Roger at [email protected]