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There are no translations available. Overview Lao Economics In order to be able to cope with the challenges of globalization and free market-interdependence, The Lao Government is of the view that economic reforms, trade liberalization and integration with the world economy are necessary. We also firmly believe that international trade and foreign investment are essential for faster economic development and poverty reduction. We recognize that private sector has a key role to play in this process, and the role of government is mainly to provide a conducive policy framework for trade and investment to take place efficiently. It is in that context, that the Lao Government, since the mid 1980s has been pursuing an open door policy.The Real GDP growth in Lao PDR rose to 7 percent in 2005, from 6.4 percent in 2004. All sectors grew rapidly- with industry growing fastest but from a low base. The share of industry in now more than 25 percent of GDP. The international trade also has grown substantially. In 2005 as compared to 2004 total export earning increased by more than 30 percent: from US$ 500m to about US$660m. at the same time, import went up by 14 percent: from US$977m to US$1,116m. ASEAN is the major trading partners. The stimulus of large projects in mining and power sector more than offset the dampening effects of high international oil prices and the expiry of the Multi-Fiber Agreement (MFA) quota system. The economy is projected to grow at 7.1 percent in 2006 and to continue growing steadily at 6-7 percent in the future. However, a large part of this growth comes from increased foreign investment flows in hydropower and mining: with out large projects and increased investment and exports in these sectors real growth would have been about one third lower. Therefore, promoting growth in sectors other than mining and hydropower is increasingly important for ensuring stable growth in the long-run. The government’s efforts on liberalizing trade and improving the investment climate are thus step the right direction. We have also been granted GSP by 34 countries including the EU. This means we can export a wide variety of products duty free and quota free to these countries. To Australia and the EU countries we can export duty free and quota free almost any products except arms. Our relatively small local business community alone cannot supply to this vast market that has been opened to us by GSP. The following countries have granted GSP status to Laos: Japan (for all products); Australia (no import tax); European Union; South Korea; Norway, Switzerland, and the USA. Laos has signed trade agreements with 16 countries: Vietnam; China; Cambodia; Burma; Thailand; North-Korea; Philippines; Mongolia; Indonesia; Malaysia; Bulgaria; Russia; India; Belarus; Argentina and the USA. As such there a great opportunity for investors to come and invest in our country, produce and export to these countries and reap the benefit from the GSP concessions. |
