Govt expects US$153 million from state enterprises

Govt expects US$153 million from state enterprises

The Lao government hopes state enterprises will bring in more revenue to the treasury, making more funding available for programmes next fiscal year.

According to a report from the Ministry of Finance, the government expects to collect 1.23 trillion kip (US$153 million) from state enterprises in the country during the 2014-15 fiscal year, a 2.24 percent increase compared with this fiscal year's target.

Laos' 100-percent-state-owned enterprises together have a total asset value of about 19.43 trillion kip (US$2.4 billion), with the largest being Lao Airlines, Lao State Fuel Company, ETL telecommunications and Electricite du Laos.

As part of measures to generate funds from these state owned enterprises, the government plans sell shares in the businesses and list them on the stock market. The management teams of the various enterprises are targeting improvements before they issue initial public offerings.

The government also holds shares in more than 48 state-private joint ventures in the country. Two of the largest are Lao Telecommunications, with the government holding a 51 percent share of the company, and BCEL Bank, of which the government owns 70 percent.

The report shows that the government expects to collect 937 billion kip (US$117 million) in dividends from the state-owned enterprises and joint venture companies.

State enterprises and joint ventures are not only a major source of government income but they also play a significant role in boosting GDP growth. In 2011, the state enterprises contributed 8.2 percent of the GDP value, becoming the second largest contributor to GDP.

State-private joint ventures contributed 7.3 percent of GDP in 2011, while private firms are the largest contributor to GDP value, accounting for about 16 percent of the total.

The report also highlights another expected major source of government income next fiscal year with state asset management including the sale of timber to provide 1.89 trillion kip (US$235 million) to the national treasury.

The government has increased efforts to collect revenue this year so as it can secure funding for more of its expenditure programme. The government has been facing revenue shortages and is delaying payment of salaries to civil servants and debts to some public infrastructure projects.

In the 2014-15 fiscal year, the Lao government plans to collect 23.79 trillion kip and spend some 31.2 trillion kip.

vientiane times