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Chinese take a gamble on the pleasures of sin city

A playground for businessmen is thriving on land leased from the Laos government. Edward Loxton reports from Kapok City

It may be well down river from the People's Republic, but the red flag of China flies prominently among other national standards at a jetty on the Thai bank of the Mekong River. Visitors check out with Thai immigration officials, before being ferried upstream in a sleek speedboat to a world of ostentatious casinos and half-built hotels.

Welcome to the Golden Triangle Special Economic Zone, a Chinese-leased playground on the Mekong River border between Laos and Thailand – or Kapok City, named after the tree that provided the area's main source of income before the Chinese moved in.

The 25,000 acre site – larger than China's famous gambling playground Macau and billed as a new city destined to be the throbbing heart of the fabled Golden Triangle region – was leased by the Laotian government to a Chinese business group, KingsRomans.

They are only a few years into that 99-year lease, and new buildings are springing up fast.

When complete, developers claim the site will be home to two casinos, a dozen or more hotels, an international airport, up to six golf courses, holiday residences and a network of services that will include shopping malls, supermarkets, restaurants and bars.

Right now, most of the people who visit the area are Chinese who brave the day's road journey along a mountainous route from the Sino-Laotian border at Boten to spend a weekend in what Thais on their side of the Mekong are dubbing "sin city".

"With time, we hope to attract more visitors from Thailand and also Western tourists," Ebahim Abbas, president of the main casino in Kapok City, told The Independent.

The formalities of entering Kapok City from Thailand are as streamlined as the courtesy speedboat provided by the KingsRomans Group for the brief river crossing. A Thai exit permit costs the equivalent of £10 – well worth parting with for the pleasure of the exhilarating ride across the Mekong.

A wide staircase leads from a waterfront pier on the Laotian side to a spanking new Laotian immigration building, sporting an ostentatious golden dome. Gold is the predominant colour and theme of this extraordinary development.

Visitors hand in their passports and Thai exit forms to the Laotian officials, who return them unstamped on departure. Entry formalities take a few minutes – opening the doors to the pleasures and enticements of Kapok City, which include the inevitable casinos, tax-free shopping and, for male visitors, cheap, barrack-like brothels.

Although slated to become the second largest city in Laos with a projected population of 200,000, bigger even than the world heritage city Luang Prabang, Kapok City appears on no maps. It is virtually self-governing, with its own security forces patrolling wide roads bearing such names as Park Avenue, where even the cruising limousines are Kapok City registered vehicles.

Chinese is the official language, which can make life difficult for visitors, who find hotel room instructions written only in Mandarin. Chinese Yuan are the preferred currency, although Thai Baht are accepted. There are no banks or ATMs, while credit cards are carefully screened before payment is accepted.

The main casino – a vast, vulgar building reminiscent of the excesses of Las Vegas – is the first construction to be completed in Kapok City. A huge golden crown and a golden cupola sit atop the palatial building, whose main entrance is flanked by a dozen statues of Greek and Roman deities.

A huge statue of Zeus welcomes punters into an entrance hall where glittering chandeliers hang between soaring Corinthian pillars and walls covered with oversized reproductions of European Renaissance masterpieces. The surrounding land is piled high with building materials – sand, bricks and concrete drainage pipes. There's a sense that nobody is in a hurry to complete the job – after all, the Chinese own the place for the next 90-plus years.

The tax-free status of the new city keeps prices down – a room in a comfortable hotel costs the equivalent of £15 pounds while an enormous Chinese buffet at the casino can be enjoyed for just £2.

Two Laotian villages, complete with their temples, were relocated to make room for Kapok City. The Laotian farmers who once grew rice, beans and garlic on the alluvial Mekong soil were replaced by a small army of construction workers needed to create Kapok City.

The main casino alone employs 2,000 people to keep the gaming tables staffed and the roulette wheels spinning around the clock. The staff includes croupiers from Sino-Burmese border towns, where the once-thriving casinos have suffered from an official Beijing clamp- down. Kapok City is presumably far enough from China to escape official attention from Beijing.

Some of the casino workers have been flown in from Russia's far east to boost the numbers of qualified staff needed to maintain the 24-7 routine. Olga, from Vladivostock, is one of the Russians employed to work the roulette and blackjack tables. Is she happy working at Kapok City? The young woman smiles weakly and signals with her hand "so so".

Mr Abbas, a Malaysian-born Australian citizen, admits it's difficult keeping foreign staff happy in a city that's still a construction site. "They get homesick very easily," he says.

Wandering the deserted streets at night, it's easy to understand the Russian woman's unhappiness. Apart from the casino and one or two of the livelier restaurants, there's not a lot to do in Kapok City. Single men in search of sex head for the primitive brothels that have sprung up to cater for gamblers who have struck it rich at the gaming tables. Outside the reach of most official law enforcement, there is little protection for the women working in the sex trade here.

Even hotels have plugged into the sex trade, and unaccompanied male visitors staying at bourgeois "boutique" establishments are asked when checking in: "Would you require the company of a young woman during your stay?" The equivalent of £40 is charged for two hours of "service" from a Thai sex worker, while young Chinese women command a higher rate – £50. Hotel rooms have bedside packets of condoms and sex aids. The television – showing only Chinese programmes – offers hardcore porn.

Male visitors who resist the reception desk offerings return to their rooms after an evening on the town to find that explicit "calling cards" have been slipped under their doors in their absence.

"The Chinese are persistent, in everything," said a visiting Thai businessman. "They have to be, to take out a 99-year lease on this place."