Lao Isan - Economy

Subsistence and Commercial Activities. The northeast has the highest incidence of poverty in Thailand; 50 percent of Thailand's poor live in the northeast. The region has poor soils with low fertility and poor water-retention capabilities. Yet it accounts for approximately 36 percent of the national rice production and more than 90 percent of the kenaf, a product closely related to jute (1971/72 figures). Rice is the main crop of the region and most of this is glutinous rice, a japonica variety much favored as a staple by the people of the northeast. Of all rice production in the region, 78 percent is of the glutinous variety (1970 figures). Most of the glutinous variety is consumed locally and the nonglutinous rice is marketed in Bangkok. The other major crop is kenaf, which competes with jute; its market is subject to the success or failure of the jute crop in India and Bangladesh. Kenaf is sold by the farmers in the major centers of Khon Kaen and Ubon Ratchathani, cities that are in the center of the major growing areas. Three-quarters of the kenaf is exported. The third-largest crop is maize, although it is limited by poor soils and unreliable rain. Maize is grown mainly in the provinces of Nakhon Ratchasima and Sisaket. It is marketed through Nakhon Ratchasima to Bangkok for export. Other crops in the region include cotton, sugarcane, peanuts, and cassava, but these cash crops are more productive in other parts of the kingdom.

The northeast excels, however, in the production of cattle and buffalo. A large part of the Khorat Plateau is unsuitable for crop production, but the low hills and open forests, with their abundant grass for pasture, have allowed north-eastern farmers to raise cattle and buffalo for additional farm income. Approximately 40 percent of the kingdom's cattle and 55 percent of the water buffalo are raised in the north-east. Cattle are marketed through dealers who sell them to slaughter houses, 20 percent of the annual production going to slaughter houses in Bangkok. Buffalos also are sold to dealers who then sell them to slaughter houses, 60 percent of which are in Bangkok. This pattern of farmers selling to dealers and not slaughtering animals themselves is partly related to Buddhist beliefs about bad karma arising from the killing of large animals.

Manufacturing is very limited in the region. Most employment is in textile production, followed by food, beverage, tobacco, wood, and furniture production. Food (rice milling) plays a dominant role in the industrial economy.

Industrial Arts. The northeast is well known for silk and cotton textiles, woven by women. Lately these woven items have been the object of various projects seeking to revive "traditional crafts" in the region. In Nakhon Ratchasima Province there is a thriving pottery industry that probably goes back to the time of the Ayutthayan Kingdom. Today this craft is in decline. Recently, some domestic and foreign companies have moved into the region with the object of utilizing the relatively cheap labor resources for manufacturing and agribusiness projects.

Trade. Villages may have a small retail shop or two, selling manufactured items and prepared foods. Often these are operated by village families with a better-than-average income. Usually women are involved in small trading enterprises, often selling vegetables and fruits in the village or prepared food at temple fairs. In some cases, village men become involved in the cattle and buffalo trade. Larger trading operations involving rice and other agricultural products are usually carried out by Chinese or Sino-Thai traders from outside the village.

Division of Labor. Both men and women work in farming, men doing the heavier work such as plowing and clearing of forests. Generally, men and women share the other duties of farm work, such as planting, harvesting, and weeding. Women weave cloth in the off season. Typically, men fish and they build and repair housing.

Land Tenure. Despite the poverty of the region, land tenancy in the northeast is relatively low, about 10 percent of all households (1980). The vast majority of households has access to land, although land distribution is uneven and farm size is small (average 1.75 hectares). Opening new land is no longer an option, and growing populations may be absorbed by urban parts of Thailand, Bangkok in particular.