Border boomtown: A tale of winners and losers

Between Thailand and Myanmar, the town of Mae Sot is experiencing rapid economic growth. But the story of success is a double-edged sword, with migrant workers struggling to live, even as the town gets richer.

The border town of Mae Sot is undergoing an unprecedented boom, riding on Myanmar’s rapid opening up and its strategic position as a regional transport hub. Not long ago, the main visitors to the remote city in Tak province were NGOs, aid donors, academics, diplomats, journalists and intelligence officers. But in the last two years, 20 new hotels have sprung up, mainly to cater to Thai investors, according to the Tak Chamber of Commerce (TCC). The signs of the boom are all around: concrete pillars are being laid for a Big C supermarket, cinemas showing the latest films are opening and department stores sell international brand names.

Yet the story of Mae Sot’s growth is a complex one, with migrant workers still struggling to survive, and locals expressing concerns about the downside of rapid expansion.

The Thai population is projected to increase from 130,000 to 220,000 within two years, a projection that excludes an anticipated growth in the number of migrant workers from Myanmar. ”I’m unsure as to whether the government can cope with the social problems as a result of the increased population,” said TCC secretary-general Prasert Chungkitrungroj, ”not to mention the increased pollution. And the roads need to be improved as there are more cars. Potentially more crime is also a real concern.”

Last month’s cabinet approval of a proposal to turn Mae Sot district into a special economic zone, to take advantage of the city’s strategic border location, has fired up local businesses, with the TCC projecting border trade to reach 60 billion baht this year.

The hoped-for completion within two years of the East-West Economic Corridor, the massive 1,500km multi-lane highway linking the coasts of Vietnam and Myanmar through Laos and Thailand, which goes through Mae Sot, will only add to the economic growth.

”We haven’t seen any improvement in the working conditions of workers in Mae Sot over the years,” Ko Htway Naing, a spokesperson for the Yaung Chi Oo Worker’s Association. ”The town of Mae Sot has gotten richer, but the conditions for workers are still bad.”


The special economic zone will initially be set up in tambons Mae Pa and Tha Sai Luad, covering an area of more than 900 hectares, next to the Moei River, which separates Thailand and Myanmar. An industrial estate will be set up and jointly operated by Tak provincial authority, the private sector, the Industrial Estate Authority of Thailand and the Customs Department.

Transport infrastructure, shipment and distribution centres, duty-free areas, bonded warehouses, one-stop service facilities, single service inspection and customs checkpoints will all be part of the special economic zone.

Trade figures illustrate Mae Sot’s fast-growing importance as a commercial hub _ border trade through Mae Sot checkpoint saw a surge of 80% last year to about 39 billion baht thanks to Myanmar’s first steps towards democracy and the relaxing of economic sanctions.

The TCC prediction of 60 billion baht this year could be well short of the mark. The real figure could be much higher, with some investors receiving exemptions from taxes and import duties.

As part of the government’s 51 billion baht development projects for the lower northern provinces, Mae Sot will receive funding for a tunnel, railways, a four-lane Tak-Mae Sot highway and industrial estates.

The government also plans to build a second Thailand-Myanmar friendship bridge to straddle the Moei River.


Mr Prasert said that the growing population of Mae Sot would place a severe strain on the town’s basic facilities.

The town has one hospital, and Mr Prasert says it is inadequate to serve a larger population: ”We need two hospitals now, as many Myanmar migrants also use Mae Sot’s hospital, putting additional pressure on the local healthcare system,” he said.

Mae Sot is in desperate need of more skilled workers, such as teachers, nurses and doctors. ”We can build the schools but we don’t have the teachers to fill them.

”As this town’s economic importance grows, we want schools comparable with Chiang Mai and Bangkok.”
While 20 new hotels had been built they were mainly offering ”budget accommodation” of around 40 rooms each to serve Thai guests, not foreigners.

Mr Prasert said that Mae Sot’s most sought-after areas _ on the Asia Highway for example _ had increased in price as much as tenfold since 2011.


Despite the impressive growth figures, long-established businesses in Mae Sot have to compete with a natural side effect of economic growth _ more competition.

Sarot Lertwijitsap is the owner of the local Boonrot electrical supply chain, and has seen trade drop by nearly a quarter over the last two years.

”Myanmar represents as much as 60% of our weekly business here in Mae Sot,” he said.

”But many Myanmar people just buy straight from Bangkok now … since Myanmar opened up making travel easier for them.”

On top of this is competition from a new Tesco Lotus supermarket, which opened two months ago. Businesses find it hard to compete with what the megastore has to offer.

”It’s upset business. Tesco can offer recreation, cinemas, as well as electrical goods, making it hard to beat.”

But Mr Sarot is optimistic about the mid- to long-term future of his business. ”Things will settle and improve, because I see more Thai middle class people coming to Mae Sot. The new big highway will attract more Thais,” he said.

Bebot Lameechanay, who works at Boonrot electrical store, said that he looked forward to the near future, especially as Myanmar continues to open up. He says that all the new hotels being built have been good for business.

”We deliver 10 to 20 luxury TVs a day. But, when a new hotel is built they might order 40 to 60. We are now getting an order like this every two weeks.”


Mae Sot has an estimated 150,000-200,000 migrant workers and despite the city’s rapid growth they are seeing few benefits because of the ready and willing supply of cheap labour from across the river.
And while Thailand increased the minimum wage to 300 baht a day, worker advocates say there is still room for widespread exploitation.

In fact, the majority are paid as little as 60 baht a day.

Ko Htway Naing says many employers in Mae Sot do not respect the minimum wage. ”The majority of migrant workers in Mae Sot get between 65 and 120 baht a day. They don’t get more than that. The reason migrant workers in the Mae Sot area are not paid the minimum wage is that it is so easy for employers to replace workers.”

Ko Htway Naing says that it demand for jobs in Thailand is high, so employers can keep wages low and working conditions poor.

”Even if the employer loses an experienced worker, they can get 10 new workers for low pay,” he said, making it difficult for migrant workers to campaign for improved rights.

A survey of nearly 800 Mae Sot residents by the International Rescue Committee (IRC) and Tufts University found that, ”over the last year, one in five migrants experienced eviction, one in 10 suffered physical assault, and one in six was a victim of theft. More than a third of the migrants live in unsafe or unsanitary housing.”

The 2012 report, titled ”Surviving or Thriving on the Thai-Burma [Myanmar] border: Vulnerability and Resilience in Mae Sot”, noted that transient migrant workers often did jobs in the agricultural, manufacturing, construction, domestic work and fishing sectors; ”jobs that are often dirty, degrading, and dangerous”.

A shop assistant in Tak working in a well-stocked homeware store said that although he had a 10 year workers’ pass he didn’t get the minimum wage. ”Even though my boss is kind, he doesn’t give me the 300 baht wage.”
He said that this was the case for many other workers in Mae Sot.


For Ma Tway (not her real name) and many migrant workers like her, Mae Sot’s boom has done little to improve a precarious existence on the border.

Ma Tway, 24, works in a sewing factory in Mae Sot and earns 100 baht a day. She works in Thailand illegally, and like many Myanmar workers, does this job out of desperation.

”I don’t like to work here, but I have to,” she said. ”I came to Thailand in 2007 with my aunt. I had to learn how to sew in Myawaddy [in the southeast of Myanmar] before I could come and work in Mae Sot. I had to pay 7,000 baht to learn this skill.”

When she first started working in Mae Sot, Ma Tway earned only 60 baht per day. After two years at the factory, Ma Tway received a 10 baht pay rise, and after three years she was earning 80 baht a day.
Ma Tway and the other workers at the factory were forced to live in a cramped compound filled with small bunk beds. Their boss would demand 50 baht a night for water and electricity.

”We had to live there, and it was dirty and there wasn’t enough water. It was bad for your health. Last year I got sick with tuberculosis because of the bad conditions at the factory.”

Because they were in Thailand illegally, their employer could constantly threaten them with deportation if they demanded better conditions.

The workers were scared. Ma Tway said that he would shout abuse at them if they did not work fast enough, ”There was no government organisation to help us to get the 300 baht [minimum wage].”

As city coffers swell, people like Ma Tway are being left behind. She is still trying to get her work permit and passport.

”If I get it, I will move to another place where I can get better wages. Now, monthly, I earn just 1,000 baht, and most of that is spent on food.”

Thailand is currently in the process of collecting and checking documents to verify migrant workers’ nationalities. Known as the nationality verification scheme, the deadline for completing the process is set for March 16. Myanmar’s Deputy Labour Minister U Myint Thein said last weekend at a press conference held at the Myanmar embassy in Bangkok that his country would contribute US$1 million (29.8 million baht) in the first year of a five-year support programme for migrant workers, a sum set to increase each year.

In addition to providing documentation for Myanmar migrant workers, support would include education assistance. He urged Thailand and non-governmental organisations to help fund the programme.

An estimated 1.2 million migrant workers from Myanmar have been registered by the Thai government so far, and Myint Thein estimated that more than one million are still to be processed. He also estimated that migrant workers from Myanmar are accompanied by as many as 200,000 children, around half of whom were of school age.

”We would like children who are dependent on parents working in Thailand to have documentation so that the authorities can provide protection and social welfare for them.”

Thailand has set up 11 one-stop service centres for unregistered migrant workers in cities throughout the country to facilitate the process and Myanmar has dispatched officials to assist at all of them.

These nationality verification centres have the capacity to service 500-1,000 migrant workers per day, Myint Thein said. The cost to a migrant worker for all the documentation they need to legally stay and work in Thailand is around 3,500 baht.

This covers the cost of a temporary six-month Myanmar passport (550 baht), a two-year Thai visa (500 baht), a work permit (1,900 baht) and a health check (600 baht).

However, migrant workers whose employers either won’t cooperate or simply cannot be bothered to get their employees’ documentation led to private brokers were being used as a last resort.

Myanmar’s ambassador to Thailand, Tin Win, said that the cost of obtaining documentation in Thailand was too high for migrant workers, with some having to pay as much as 15,000 baht.

”The actual process should not be expensive for the workers, but some have to pay brokers,” Tin Win said. He urged Thai authorities to ensure that brokers in Thailand didn’t exploit migrant workers from Myanmar.


Adisorn Kerdmongkol, an adviser to the Migrant Rights Promotion Group, said that although he supported Thai government efforts to combat the extortion of migrant workers, much more needs to be done. ”Eleven one-stop centres are not enough for one million workers,” he said, ”and private brokers charge anything between 5,000 and 20,000 baht.”

According to a 2012 International Rescue Committee/Tufts University report, the hundreds of thousands of migrants on the Thai-Myanmar border live a precarious life, with little or no legal protections. They come to Thailand looking for better-paid work then they could hope to find at home, or simply to escape forced labour, internal displacement, extortion, arbitrary taxation from multiple armed groups, abuse or the appropriation of their land.

Mr Adisorn said that daily workers _ those that don’t usually stay long in Thailand _ were often found in the most high-risk jobs, such as construction and manual labour. ”We know of daily workers being crushed loading containers on the river,” he said.

Worse, working in such tough environments also puts the workers at risk of developing crippling conditions years, or even decades, later.

”Even if injuries, like chronic back injuries, don’t surface until 10 years later who will pay for their treatment?” asked Mr Adisorn.

Many of the injuries are easily avoidable, but due to the employer’s ignorance, or carelessness, they continue to occur everyday.

”One worker was badly maimed at a pork factory. They didn’t know how to properly operate the large mincing machinery _ the instructions were only in Thai. We often hear of migrant workers losing fingers or even hands.”

This article appeared first in Bangkok Post on 17 February 2013.

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