LAOS SIGNS UP FOR DRUGS SUMMIT

Laos has agreed to Prime Minister Thaksin Shinawatra's proposal for a
four-nation summit on combatting drug trafficking.

Mr Thaksin said Lao Prime Minister Bounyang Vorachit made the commitment in
talks yesterday.

China and Burma have already backed the proposal. The summit is planned for
Kunming in southern China, but no date has yet been fixed.

Lao Foreign Minister Somsavat Lengsavad said Mr Bounyang would attend the
Kunming meeting, with no conditions attached.

The summit would benefit Laos, he said.

Vientiane had not realised Burma had already agreed to the idea until told
by Mr Thaksin, he said.

Mr Thaksin said Laos also agreed to joint patrols with Thailand on drug
smuggling routes.

Bangkok had also given a reassurance that its policy was to ban insurgents
from using Thailand as a base for operations against Vientiane. The two
countries would also embark on joint intelligence-gathering efforts.

It had been agreed land border demarcation would be completed next year and
the river boundary a year later.

This meant the borders with both Malaysia and Laos would be fully
demarcated wthin the term of the present government, Mr Thaksin said.

Mr Bounyang also confirmed Laos intended to sign an economic agreement with
Thailand covering areas such as tourism and investment, as proposed to
Vientiane by the previous government.

Mr Thaksin also gave a guarantee Thailand would honour agreements to
purchase electricity from Laos.

A power purchasing agreement would be signed so work could move ahead on
the Nam Theun 2 hydropower dam project.

This was crucial so investors could obtain a loan guarantee from the World
Bank for the US$1.2-billion scheme.

Nam Theun 2 will be the largest dam in Laos and sales of power will in
future be the main source of income for the government.

Thailand plans to buy about 3,000 megawatts of power a year from various
sources in Laos.

Mr Thaksin said Mr Bounyang told him work on a road linking Mukdaharn to
Savannakhet in Laos and then Danang in Vietnam would continue.

However, it needed to yield benefits for the three countries.

The leaders agreed to move ahead on building a road between Huayxai,
opposite Chiang Khong district, Chiang Rai, and the Lao-Chinese border.

The prime minister is scheduled to meet Thai businessmen in Vientiane today
before returning to Bangkok. He plans a visit to Burma for talks with its
military junta next week.