Cambodia, Laos and Vietnam were once a federation of colonies known as French Indochina and part of France’s colonial empire. To a large degree, the development of these countries for potential retirement was hindered by wars of independence from French colonial control. This was followed by a devastating war with the United States. And ultimately, these two wars were followed by a period of great internal political upheaval.

Today, those years of conflict are slowly becoming a distant memory and efforts are being undertaken to follow countries like Thailand and Malaysia into the global economy.

Cambodia, Laos and Vietnam Retirement: Physical Geography of ‘Indochina’

Climate: Cambodia, Laos and Vietnam all have tropical climates that are dominated by the monsoon. The monsoon is a seasonal shift of wind direction that brings a summer rainy season when winds move inland and a dry season when air masses move out to sea. Cambodia and Laos are generally protected from tropical cyclonic storms, but Vietnam lies in the path of these storms and experiences typhoons during part of the year.

Geology: The entire region is fairly mountainous, but is a geologically stable region and not prone to major volcanic or earthquake activity. Laos is landlocked, but Cambodia and Vietnam have coastlines that provide access to the sea creating areas that are quite amenable for development of the tourist industry.

Cambodia, Laos and Vietnam Retirement: Cultural Landscape

French Indochina once consisted of Vietnam (Cochin China, Tonkin, and Annam), Laos, and Cambodia (Khmer Republic). France obtained control over most of modern day Vietnam following the Franco-Chinese war in 1885. Indochina expanded to include all of modern Vietnam, Cambodia and Laos by 1893 with Hanoi as its capital.

In the 1940’s, Japan occupied Indochina and effectively seized control over the colony from France. Indochina was ‘ruled’ by Vichy France during the war but for all intents and purposes was under Japanese occupation. After Japan’s defeat, the Vietminh began a war of independence against the French. The ultimate conclusion of the French Indochina War was independence, but political separation of Vietnam.

The French colony of Indochina survived until 1954 with the defeat of the French. However, Vietnam was partitioned into two Vietnams which ultimately brought the United States into a long and drawn out Vietnam War. Following the end of the Vietnam conflict, Cambodia continued to experience a great deal of internal conflict it was not until recently that normal relations with the United States were established with these three Communist countries.

Today, the three countries remain among the less developed countries in the world. The per capita income for these countries are: $1,690 (Cambodia), $1,940 (Laos), and $2,550 (Vietnam). Contrast this to neighboring Thailand’s per capita income of $7,880 and it becomes clear how war, internal unrest, and isolation from the global economy has affected the region.

Cambodia Retirement and Expat Living

Today, Cambodia is what remains of a once powerful Khmer Empire that ruled much of Southeast Asia. The people of Cambodia are predominantly Buddhist and descendents of the Khmer people.

The country seems to be more stable under a democratic constitutional monarchy today and poised to establish its place within the global economy. Considering that during the post-Vietnam War era, the Khmer Rouge government devastated the country with its anti-western philosophy, it is a wonder that Cambodia has managed to pick itself up and move forward at all.

Although the country remains primarily agricultural in nature, economic growth in recent years have been tied to the textile industry and tourism. Over a million arrivals come to Cambodia each year to enjoy the Angkor Wat ruins of the former Khmer Empire and the country’s tropical beaches.

It is likely that economic growth will continue to accelerate into the future. Mineral, oil and gas mining in the waters off Cambodia’s coast are being explored and developed and may become a major source of revenue for the country in the next decade.

Although much modern infrastructure is lacking, the shift towards a more democratic government, the growth of the textile and tourist industries, and development of natural gas and petroleum production suggests that this is likely to change over the next decade or two. Cambodia is likely to become one of the best places to retire in Southeast Asia.

Laos Retirement and Expat Living

Laos became independent as a constitutional monarchy in 1954, but was dragged into the Vietnam War by North Vietnam that needed that country as a supply route to South Vietnam. This resulted in an American bombing campaign that dropped more explosives on this country than it dropped in all of World War II. Many of these bombs remain unexploded and represent a hazard to the people in the countryside. The monarchy was overthrown in 1975 and since then the country has remained a single party communist nation.

The country remains primarily agricultural and lacks modern infrastructure. The landlocked nature of the country also isolates Laos from access to the sea. Tourism is growing rapidly with over a million visitors entering the country each year. The country has mineral resources but for the most part they remain undeveloped. There is potential for development of hydroelectricity for export to surrounding countries like Thailand.

The people of Laos are ethnic Lao who make up about 70% of the country’s population. Like Cambodia, Buddhism is the predominant religion in the country.

Development of Laos can be expected to be slower than in Cambodia or Vietnam. The geography of the country makes infrastructure development difficult and costly. The kind of infrastructure that the average American expects is just not in place for most of the country. Nevertheless, as its neighbors continue to develop, Laos can be expected to be pulled into the economic growth although at a slower pace. Despite these challenges, Laos could emerge as one of the best places to retire in another 20 years or so.

Vietnam Retirement and Expat Living

Victory for the Vietnamese has been bittersweet in its many wars for independence. Its last major war with the United States resulted in the reunification of the country under communist control. Economic development following that war was modeled after Soviet and Chinese economic strategies and yielded only modest results. And for the most part, Vietnam was isolated from the western world.

By the mid 1980’s reformers grew impatient with the lack of progress of the old Soviet economic model and began to implement newer economic strategies based on private ownership and free market reforms. Although still a communist nation, these reforms have helped the country move forward at a faster pace than Cambodia or Laos. The new progressive and outward looking attitude of the country began to attract a considerable amount of foreign investment that in part is now building the foundation for a viable Vietnam retirement experience.

Today, Vietnam has one of the fastest growing economies in the world. Vietnam is primarily agricultural in nature, but manufacturing, information technology, and oil production are now fueling this economic growth. Tourism is also beginning to become a significant part of the economy with well over 3 million visitors entering the country each year. The nation’s infrastructure is still somewhat lacking when compared to Thailand. However, the foundations are there for continued recovery and development of the country.

The solid economic foundation of the country suggests that development should continue into the foreseeable future. The influences of both France and the United States, although once seen as negatives, now helps open the door to tourism and trade. The large coastline, diverse geography, and relative low cost of living will make this one of the best places to retire in Southeast Asia within a decade.

Cambodia, Laos, Vietnam Retirement: Summary

Strengths: The greatest strength of these countries, may be in the progressive approach they are taking to improve their economies. At present, the cost of living in these countries is relatively low. Vietnam in particular, has been actively pursuing foreign investment to build its infrastructure. Tourism is emerging as major industries in Vietnam and Cambodia – and in the decade to come, one can expect medical and ecotourism to grow into very big draws to the region.

Weaknesses: At present, the infrastructure is a bit lacking for the average American for expat living. However, this is likely to change within the decade, with over 8 billion dollars in foreign investments flowing into the country each year. The growth of the Vietnam’s tourist industry will likely accelerate access to the kinds of amenities wanted by Americans retiring abroad.

Analysis: Within the decade, a Vietnam retirement may become one of the best choices for expat living in the Southeast Asian region. This may seem odd for an American to say, but the relatively strong central (communist) government is likely to insure political and social stability into the foreseeable future. Combined with fairly large foreign and domestic investments economic development is proceeding along a very positive development track.

Photo by: (Eustaquio Santimano)

References and Bibliography

Cambodia’s Economy in 2010, blog@WorldBank

Laos: Economic Freedom, Heritage

Vietnamese Economic Reform Faces Crisis

Vietnam’s Economy, Business Week