Reduced investment barriers needed to boost provincial development
Reduced investment barriers needed to boost provincial development
Private investment is driving socio-economic development in Savannakhet province; however its growth still faces significant hurdles.
So far, total investment in the province from 156 projects amounted to more than 14.24 trillion kip (US$1.78 billion), according to a cited report from the provincial Planning and Investment Promotion Department yesterday.
“The private investments are driving provincial socio-economic development in Savannakhet, with 36 percent of total investment attributed to the private sector, according to the latest data from the department,” a press release from the United Nations Development Programme (UNDP) stated.
However, growth in private investment still faces significant policy, taxation and administrative hurdles, the UNDP noted. Currently, the Lao government is working with private sector to reduce barriers to investment in Savannakhet.
Savannakhet boasts investment opportunities in organic agriculture, food processing, tourism and education and special economic zone opportunities.
In the tourism sector, the province expects large increases in visitor numbers in near future and plans to have more ecotourism zone investments, including the development project in the Dongnatad area of Kaysone Phomvihane district. “It is under a feasibility study by a local company that is cooperating with Australian and Thai firms,” the Savannakhet Governor, Dr Souphan Keomixay, said recently.
Investment by local and foreign business alike continues to increase in Savannakhet Province's Savan-Seno Special Economic Zone.
The zone has progressed strongly since 2007 when it welcomed its first investor. Officials of the zone confirmed end of last year that investments of more than 1.77 trillion kip (US$221.78 million) had been made in the zone which boasts registered capital of over 531 billion kip (US$66.37 million).
Currently, UNDP and the United Nations Environment Programme (UNEP)'s Poverty Environment Initiative (PEI), in close collaboration with the Planning and Investment Ministry's Investment Promotion Department and the provincial Planning and Investment department are working to improve conditions for private investment through public consultation.
Recently, the PEI coordinated the first Public-Private Dialogue (PPD) aimed at assessing the various barriers experienced by investors when initiating or conducting business operations in the province.
The meeting was attended by investors working in the manufacturing, agriculture-forestry, transportation, trade, education and construction sectors and provided a platform to share their knowledge and experience of conducting business and overcoming challenges.
Participants identified issues on the difficulties of doing business in Savannakhet, including the procedural and logistical constraints of obtaining transportation passage permits, the shortage in the labour market, the need for labourers with assembly-line experience and the conflict of private education initiatives with the current customs law.
Issues on taxation, accessing of government loans and the need for improved government procedures were also raised.
The meeting also highlighted the importance of coordinating government agencies to monitor the compliance of business operations and encouraged the private sector to responsibly implement their investment projects.
The PEI is supporting the Lao government to address the barriers identified by PPD participants in Savannakhet and to promote the quality of private investments to maximise economic benefits while minimising social and environmental impacts throughout Laos.
