VIENTIANE (AFP) -- Landlocked at the heart of Southeast Asia, Laos, where the ruling communist party started its congress Saturday, is among the world's poorest countries, sustained largely by foreign aid.

The Lao People's Democratic Republic was founded in 1975 following the "thirty year struggle" against French colonial troops and U.S. forces whose Cold War conflict had spilled over from neighboring Vietnam.

During America's undeclared "Secret War" in Laos, U.S. bomber planes saturated the country with the equivalent of two tons of explosives per person, killing untold numbers of people and displacing millions.

The Pathet Lao guerrilla movement took power in Vientiane in late 1975 -- the same year North Vietnamese tanks rolled into Saigon -- ousted the monarchy and set up what soon became an authoritarian regime.

Intellectuals, royal family members and officials linked to the former regime were sent to reeducation camps or escaped to Thai refugee camps. The economy was collectivized as Laos closed its doors to the outside world.

It was only in the late 1980s, following Moscow's lead and the example of Laos' influential communist neighbors China and Vietnam, that the country started gradual market reforms and somewhat eased its grip on society.

The country joined the Association of Southeast Asian Nations in 1997, as foreign donors and non-governmental organizations were flooding into the country, injecting huge sums of cash.

Lacking in easily exploitable natural resources, Laos remains dominated by rice farming. Tourism is growing as visitors are drawn to the mountainous country's natural beauty and Buddhist religious and cultural sites.

To earn foreign revenues, the regime is also banking on cash flows from a controversial hydroelectric project, the 1.2 billion dollar Nam Theun II dam, which will sell electricity to neighboring Thailand from 2009.

Laos has little industry, few exports and an economy hobbled by poor infrastructure and corruption. It survives largely on international loans and aid, which make up about 80 percent of the state budget.

Yet the LPRP's rule seems firmly in place. Neither a largely exhausted rebellion by the Hmong ethnic group, nor protests from the Lao diaspora seem to seriously threaten the regime backed by powerful China and Vietnam.