Industrial output sees big jump as consumption demand grows
Industrial output sees big jump as consumption demand grows
The value of Lao industrial and handicraft output saw a rapid growth last fiscal year as factories produced more goods to meet the rising demand of domestic consumption.
According to a report from the Ministry of Industry and Commerce recently, the value of Lao industrial and handicraft output was 5,032 billion kip (US$629 million) in the 2012/2013 fiscal year, about a 29 percent increase compared to the previous year. The figure exceeded the annual target by 14 percent.
Industry Department Director General, Mr Manohack Rasachak told Vientiane Times on Friday that rising domestic demand was one of the main factors in the rapid increase of industrial and handicraft output last fiscal year. He said one of the outstanding industries producing more goods for the domestic market was construction material processing factories such as brick, cement, steel, roof and nail manufacturers.
The rapid increase in the output of construction materials was due to growing real estate development in Laos and strong economic growth. The government also invested a large amount of money in the development of infrastructure.
Mr Manohack said the production of food and drinks such as soft drinks, beer, energy drinks, health drinks and noodles also saw substantial increases due to the growing demand as the country's population increases.
Laos is home to 6.5 million people but this number is swelled considerably by foreign migrants living here. Mr Manohack said that other main causes increasing industry output, were the growing number of factories being established especially in industrial parks and special economic zones. These factories mainly produce goods for export.
“Many provinces now have industrial parks and each park accommodates a number of factories.”
He said that the output value of the industry and handicraft sector would see a more than 10 percent growth over the next few years with more companies investing in Laos as the country is now a member of the World Trade Organisation and will soon be a part of the Asean Economic Community.
The industry sector saw a 7.4 percent growth in the 2012/2013 fiscal year, accounting for 28 percent of the GDP. The growth in industry will obviously result in an increase to industrial output.
“Invest ors now feel more confident to establish businesses in Laos as we have improved our business climate to meet international standards,” he said.
He added that factories assembling electronic goods ha ve expressed interest in investing in Laos. He believed that Laos would become a new investment destination as the country has plenty of natural reso urces and enjoys political stability.
Representatives of garme nt factories have said that a number of Japanese garment companies have begun to leave China for Laos as they no longer find the labour cost there affordable.
vientiane times
