Value of Lao exports, imports exceeds expectations
The value of Lao exports and imports has exceeded the target set in the 7th Five-Year National Socio-Economic Development Plan, according to the Ministry of Planning and Investment.
The ministry unveiled the results of the plan at the half-way stage during a meeting with donors last week. The figures showed the value of exports had already reached 76 percent of the goal set in the five year plan, and was 19 percent ahead of the target.
This remarkable increase in export value is largely due to the surge in sales of mining products and hydropower. The mining sector contributed 58 percent of the total, with 13 percent coming from hydropower exports, according to a presentation given by the Planning Department.
Department officials told Vientiane Times they could not provide precise figures on export values at present but were able to confirm that the value was higher than earlier projected.
About 68 percent of Lao exports are shipped to Asian countries including Thailand, Vietnam and China, while 21 percent go Oceania, including Australia and New Zealand, and the rest is exported to the EU and the United States.
The planning department also unveiled that Lao imports underwent a major surge during the first two and a half years of the 7th National Socio-Economic Development Plan, from 2011 to the middle of 2013.
The Planning Department said the value of imports had exceeded the figure set in the plan by 28 percent, increasing by an average of 42 percent annually. Imports of vehicles and spare parts accounted for 23 percent of the total, while petrol and gas accounted for 18 percent and construction materials for 16 percent.
Eighty-eight percent of imports come from Asian countries, mostly Thailand, Vietnam, the Republic of Korea and China.
Analysis shows that the rapid increase in the value of vehicle imports is due to the increasing availability of credit, which enables people to pay for vehicles in instalments. As levels of wealth rise more rapidly than before, people are also increasingly able to afford a vehicle.
Many people are buying a vehicle after selling land. Land values in Vientiane are now rising by about 10 percent annually, thanks to strong economic growth.
Offi cials at the Bank of the Lao PDR say the value of imports rose sharply because of growing foreign investment, adding that the surge in imports was not a cause for con cern but a positive economic development.
They said mega investment projects would help to generate considerable income for Laos over the next five years. The central bank has sufficient reserves of foreign currency to meet the country's i mport needs.
Foreign reserves currently stand at about US$700 million, which can secure imports for a period of about five months, bank officials said.