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Stepping into South East Asia’s Most Conspicuous Criminal Enclave

Bangkok - Perched on the banks of the Mekong River, the Kings Romans casino is far from covert. Situated in the Golden Triangle Special Economic Zone (SEZ) in Laos, its neon lights beam in the direction of Thailand and Myanmar in a nightly show of opulence. Inside, meanwhile, millions of dollars are exchanged in cash for chips in what appears to be an open display of money laundering.

Zhao Wei, the Chinese crime boss responsible for developing the zone, has little reason to hide the illicit economies thriving within. Operating on a 99-year land lease in the name of his Hong Kong registered holding, Kings Romans, his organisation has been on the U.S. Treasury sanctions list for “drug trafficking, human trafficking, money laundering, bribery and wildlife trafficking” since 2018. Zhao has called these allegations “groundless”.

Satellite images from 2008 and 2023 show the rapid construction of the SEZ. Planet and MAXAR.

Our team visited the Golden Triangle SEZ in 2023. They found a city-scale development being built around barely concealed criminality. In a report published in July, Crisis Group documented the peace and security implications of allowing a zone such as this to flourish and urged China and the U.S. to prioritise a coordinated regional approach to rein in the unfettered criminality in such zones. Since then, China has moved to crack down on online scamming centres in the region, impelled in part by growing domestic concern about the number of Chinese trafficking victims lured into these operations. But other forms of criminality – including those captured by this photo essay, which draws on our earlier reporting – continue to go unchecked.

A Journey into the Zone

Visitors to the zone, including tourists and migrant workers, are shuttled from Thailand across the Mekong in speedboats. Laotian immigration officials stamp entries into the zone, but signs of their authority stop there.

Although the Lao government has an equity stake in the SEZ, which spreads across 10,000 hectares, national police and other authorities reportedly need permission to enter. The zone’s law enforcement is handled by a “public security bureau” – a private police force modelled on China’s law enforcement units of the same name.

On the Laotian side, visitors are greeted by publicity that speaks to pride in the zone’s fast-paced development. These advertisements stand in stark contrast to the trafficking warnings flanking the Thai side of the Mekong.

Driving from the immigration office into the zone, the local road slowly widens into a six-lane boulevard with high-rise buildings. There are signs everywhere that the zone has been set up to cater to the interests of external actors, especially from China. Almost immediately, visitors are struck by billboards and signage indicating that Chinese, not Lao, is the zone’s lingua franca. Clocks are set to Beijing time. Chinese yuan is the preferred currency.

The city-scale development – set to triple the resident population from 100,000 to 300,000 people – includes more than twenty hotels, dozens of high-rise office buildings, schools and hospitals, water treatment and sanitation facilities.

At the centre of the sprawl sits the casino, built ahead of any of the manufacturing or agribusiness ventures initially promised by the developers. Roman statues line its walls and a crown towers over the roof. Rolls Royces are lined up outside, but inside the corridors and game rooms are subdued. It’s hard to believe that in-person gambling is the main source of income here.

Our team witnessed separate million-dollar cash transactions taking place without documentation at the cashier desk on the casino’s gaming floor. They also saw those involved, likely implicated in large money laundering schemes, walk away with multiple bundles of 100-yuan notes slung over their shoulders in duffle bags. Our team asked one young woman if she had security concerns about carrying bundles of cash worth hundreds of thousands of dollars. She said she wasn’t concerned, because the cash belonged to her boss, and everyone knew who her boss was.

A short drive away from the casino, our team identified four guarded high-rise buildings with barred windows and high fences wrapped in razor wire. Locals told Crisis Group that people were locked inside and forced to work as online scammers. Our team met a woman who said her husband had worked in one of the buildings but was recently found dead. She said that the Lao authorities never gave her a satisfactory explanation of the cause of death. Rescue workers on the Thai border also showed us pictures sent by workers within the zone, showing bruises on their bodies, allegedly at the hands of their employers.

Locals told Crisis Group that people were locked inside and forced to work as online scammers.

CRISIS GROUP/Michelle Malaney

In recent months, China has launched a crackdown on scam centres in its border areas. Chinese criminal gangs run many of these enterprises, and they are notorious for holding trafficking victims. As discussed in previous Crisis Group reporting, while most of the young men and women are from China, Malaysia or Thailand, others come from as far away as Nigeria, Brazil and the Republic of Georgia. Those held in the centres are forced to trick people online, luring unwitting individuals into fake investments, sham romances and other such scams. Interpol issued a global warning on scam centres in the Mekong sub-region on 7 June, noting that their rapid spread represents a “serious and imminent threat” to global public safety.

The zone is also known for wildlife trafficking, including rare and endangered species. Crisis Group spotted a “zoo” marked on the map of the zone, but was unable to enter the compound as it is not open to the public. An employee told Crisis Group that the facility is used for breeding bears and tigers, consistent with the findings of the Environmental Investigation Agency, an NGO which named this same location as an illegal tiger and bear farm and abattoir. Our team also spotted bottles of tiger bone wine – reputed to have aphrodisiac properties – on sale within the zone, which the vendor said was locally produced.

In the wet market, chickens and frogs are available for purchase, intended for consumption, alongside rarer species.

CRISIS GROUP/Michelle Malaney

The zone has both a wet and a dry market, where a number of endangered species are on sale. In the wet market, chickens and frogs are available for purchase, intended for consumption, alongside rarer species, such as what appeared to be the critically endangered Chinese giant salamander. At the dry market, critically endangered axolotl and rare albino red-eared slider turtles are on sale next to puppies and household goods.

Expansion at All Costs

Despite the overt illicit activities taking place in the zone, it continues to expand. Workers toil away, creating new land on the Mekong to expand the overall area of the special economic zone, 70 per cent of which remains forested hills and nature reserve. A boulevard lined with large villas faces the river, also built on reclaimed land, a testament to the process and a hint of what’s to come.

To draw more tourists, Chinese entrepreneurs are constructing a fake Venice, which sits on a “water street” below the casino. Even in its half constructed state, the grandiose replica stands out among the cookie-cutter high-rises.

An international terminal is being added to the airport that sits just 5km from the zone. When it is operational, zone authorities hope that visitors from mainland China will be able to fly to the region directly, rather than transiting through northern Thailand.

Planning for a sprawling port facility set across 2,000 hectares is also under way and will include hotels, office buildings and large warehouses. It will handle all cargo entering the SEZ via the Mekong River. Given the zone is a known storage and trans-shipment point for drugs and other illicit goods, these facilities will only make it easier for criminal actors to bypass neighbouring jurisdictions and evade crackdowns.

Since the special economic zone was launched, Bokeo has gone from one of the country’s poorest provinces in Laos to one of its best-off, registering the steepest reduction in poverty of any Lao province since 2013. But resentment is growing among locals, who perceive drug use and crime to have risen. Living tucked away in modest one and two-story homes just outside the zone, they are watching from afar as inequality grows, rule of law is weakened and community cohesion is corroded.

For now, Laos seems to be discounting these costs and remains focused on the gains. Provincial officials have denied claims of rampant criminality in the zone, saying that it is “properly managed”. Yet the zone’s expansion into a quasi-autonomous enclave with a port and international airport brings risks far beyond its borders.

A coordinated regional strategy, prioritising intelligence sharing, joint operations and transnational multi-agency collaboration, must take centre stage. Both China and the U.S. ought to endorse and support such a regional initiative, setting aside their differences. The stakes are clear: allowing one of South East Asia’s most conspicuous criminal zones to flourish carries not only regional but global implications and demands targeted measures.