Laos sees 13 percent jump in private investment
Laos sees 13 percent jump in private investment
The value of private investment in Laos continued to rise in the 2012-13 fiscal year as the country improved its business climate to make itself more attractive to investors.
The government was able to encourage local and foreign companies to invest in 52 projects in 2012-13 with a combined value of around US$3 billion, which represents a 13 percent increase on the last financial year, according to a recent report submitted to the National Assembly (NA).
Minister of Planning and Investment, Mr Somdy Duangdy, presented the report on the 2012-13 socio-economic development plan to the NA earlier this month for consideration and approval.
The investment value achieved exceeded the annual target by 58 percent, the ministry told the NA in its end-of-year report.
The ministry did not detail which sectors were experiencing additional investment or which local and foreign firms were doing it.
However the energy generation, banking, tourism, real estate and market construction industries have all seen rapid growth over the past few years.
The Bank of the Lao PDR said US$1.1 billion worth of capital goods and cash had flowed into the country via commercial banks in the year.
One reason for the increase in investment may be the improvements Laos made to its business climate in order to meet the requirements to become a member of the World Trade Organisation, which it has successfully done.
The country is also improving its business climate to prepare for the arrival of the Asean Economic Community in 2015.
A report financed by the World Bank Group, entitled Doing Business 2014, also found the Lao business climate improved in 2013.
It showed Laos had made it easier to trade across borders and reduced the rate of corporate income tax.
Owing to these ‘improvements', the Group decided to raise Laos' international rank from 163rd out of 189 economies last year to 159th this year.
“The World Bank Group has been working with the government of Lao PDR to support trade and business regulatory environment reforms for some years now,” Ms Keiko Miwa, the World Bank Office's Country Manager in Laos, was quoted as saying in a media release posted on the body's official website.
“We are happy to see some progress from these efforts reflected in this year's Doing Business report. However, there is clearly considerable scope to improve investor protections, establish insolvency frameworks and increase transparency and predictability in the investment climate,” she said.
The Lao government has said it considers private investment the engine of economic growth. The country needs to attract around US$15 billion worth of investment from 2011 to 2015 to sustain its current 8 percent rate of economic growth.
vientiane times
