Forests, marketization, livelihoods and the poor in the Lao PDR

The Lao PDR is making the transition from subsistence to cash, and command to market. Rural communities are being drawn ever more tightly into the embrace of the market economy and of the central state. The construction of roads, schools and health centres, the provision of credit and new crops and technologies, and the arrival of traders and the panoply of the consumer economy are all, in their different ways, remoulding rural economy and society. This paper looks at one aspect of this multistranded process of agrarian transformation: the role and place of forests and, in particular, non-timber forest products, in rural people's lives and livelihoods. The paper highlights the contradictory and uneven livelihood-eroding/enhancing effects of these transformations. In many upland areas of Laos livelihoods are being squeezed from 'below' by environmental degradation and from 'above' by the operation of government policies and, more generally, by evolving market relations. While market pessimists see market integration as a largely destructive process, the paper highlights the opportunities that market integration can provide through diversification and livelihood reorientation. The challenge is that these opportunities are unequally available and are likely to promote social differentiation. Some households find themselves in a position to embrace new opportunities while others are forced to continue to rely on a declining and degrading forest resource. Copyright (c) 2006 John Wiley & Sons, Ltd.