US$24.8 billion invested since Lao renovation policy
US$24.8 billion invested since Lao renovation policy
The Lao government has approved US$24.8 billion in private investment since introduction of the new economic market mechanism in 1986, according to a report from the Ministry of Planning and Investment.
The Investment Promotion Department's Legal Division Director, Ms Thavichanh Thiengthepvongsa disclosed the latest update at a media workshop on Thursday, of private investment in Laos since the country introduced the market oriented economy in 1986 replacing the centrally planned economy.
The workshop on investment promotion hosted by Lao Press in Foreign Languages aimed to provide the media with a background on how to write economic and business news amid rising demand for the information to use as reference for business people and policy makers.
Accordi ng to the report, mining was the top sector over the market oriented period and attracted the most local and foreign investment. The government has approved US$7.1 billion investment in the mining sector. Hydropower and agriculture were also in the top three sectors, which received the second and third highest private investment of US$6.6 b illion and US$2.7 billion respectively.
The report also highlighted that local backers were the top private investors in Lao enterprises with investment valued at US$5.9 billion. China was the second top private investor with a value of US$5.2 billion. Vietnam and Thailand were the third and fourth top private investors in Laos with US$4.7 and US$4.6 billion respectively.
Ms Thavichanh said the approved investment value was higher than expectations from the government, adding that increasing domestic and foreign investment was one of the driving forces of Lao economic growth over recent times.
She also said that she was unable to provide exact data on the inflow of the foreign investment funds into Laos as this was the responsibility of the Bank of the Lao PDR.
Economists have noted that despite a rapid increase of foreign investment funds into Laos, which boost growth of the Lao economy, concerns have been expressed over the sustainable development of the country, adding that most of the foreign funds are being invested in the natural resource sector, which would be depleted one day.
The government is now drafting a national private investment strategy, which will set up measures to boost investment in the non resource sector to ensure sustainable growth of the Lao economy.
At present, the government offers incentives including tax breaks to boost investment in the countryside in an effort to narrow the development gap between city and rural areas.
Ms Thavichanh said that Laos was an attractive investment destination thanks to political and economic stability, liberal laws and regulation as well as competitive labour costs.
Laos is also a member of World Trade Organisation and will be a part of the Asean Economic Community, which will make the region a single market and one production base next year.
vientiane times
