Enterprise development needs improvement
Enterprise development needs improvement
Policy improvement and enterprise creation in the new period is urgently necessary for business development to grow the private sector economy in Laos.
Government officials from the relevant sectors gathered with business unit representatives from state enterprises and the private sector operators from different provinces last week in Vientiane.
The aim was to review the achievements of business enterprises last year and develop a plan going forward for the year ahead. The meeting was chaired by the President of the Business Improvement Committee and Minister to the Government Office, Mr Xayxengly Tengbriachue.
Despite the fact the country's economy is continuing to grow, business operations are still struggling with many difficulties and challenges, especially budget issues and disaster impacts.
Gross Domestic Product (GDP) growth in Laos has been consistently around 8 percent over the past few years, according to the annual report.
People now have an average income of about US$1,500 and the government could collect revenue into the budget of around 41,800 billion kip or 19.6 percent of GDP.
Laos became a World Trade Organisation member and will integrate with the Asean Economic Community next year. This will provide opportunities and challenges for the business sector in Laos, which needs to increase development and improve its organisations.
Some 77 state enterprises are members of the Business Improvement Committee out of a total of 132 units nationwide.
Combined the 77 state enterprises have 2,958 billion kip in registered funds.
The committee has classified six state enterprises as highly effective business units while 27 units are middle level, reaping good benefits but should improve their organisational structure. Some 23 units have suffered a loss and 10 units have to shift to other models of business.
Shareholder enterprises comprised 60 units but the committee collected only 17 units, which combined have 1,270 billion kip of registered funds, 4,636 billion kip of business funds and provided 1,603 billion into the government budget and 343 billion kip in di vidends.
Meanwhile Business Improvement Committee members from the private sector comprised 4,497 units, which are cooperative groups, producers and business associations with an average total funds of 1,008 billion kip.
Agricultural bu sinesses are expanding by an average of around 3.1 percent per annum while food products such as meat and fish are expanding by around five percent.
To improve its business enterprises, Laos will have to strengthen governance and capacity, improve infrastructure and promote better development.
The government and business operators should increase coordination and cooperation from the local to the central level, Mr Xayxengly said.
vientiane times
