Huge economic losses from road accidents in Laos
Huge economic losses from road accidents in Laos
Road accidents are not only a major cause of fatalities but also result in heavy economic losses to Laos, a senior economist has noted.
Dr Leeber Leebouapao, a senior economist at the National Economic Research Institute told Vientiane Times on Wednesday that “Road accidents bring great impact to our country but we have yet to conduct a study on this matter due to lack of funding.”
In 2014, more than 5,700 road accidents were reported in Laos, killing 1,054 people while another 9,264 were injured, with damages amounting to some 72.6 billion kip, according to a police report.
Dr Leeber said the Lao economy has been growing at about 7.6 percent recently but that figure fails to include losses to the national economy, including the loss from road accidents and other natural disasters.
He said the economic losses from road accidents could amount to 1-2 percent of gross domestic product (GDP).
The situation is likely to further deteriorate unless urgent measures are taken to improve road safety. Every accident entails an economic cost, not to mention the social burden placed on families of the victims.
Costs from an accident can be divided into victim-related costs, property damage and other expenses. Accidents also have an adverse impact on national human resources, partic ularly when essential members of the workforce are involved.
Dr Leeber said accidents also affected the livelihoods of impoverished families, particularly if the victim was the household breadwinner while an accident could also cause a well-off family to slip into poverty.
Rapid economic development, rising vehicle ownership and strong transport demand in Laos have resulted in a substantial increase in road accidents with associated loss of life and property damage.
Dr Leeber noted that road accidents impose health costs, cause property damage, diminish human resources and can damage the reputation of a country when it comes to tourism and also investment.
“Road accidents make us waste time and money,” Dr Leeber said. “Our awareness of the law is low and law enforcement sectors aren't serious about fining or taking legal a ction against those violating the traffic rules,” he said.
Up to date information was hard to find but an ADB report into road safety in 2002 echoed Dr Leeber's figures.
It noted that “Road crashes impose costs on countries of around 2 percent of their annual gross domestic product and, on this basis, the cost to the Asean countries is estimated at over US$11 billion annually.”
“These recurring economic losses undoubtedly inhibit economic and social development. Road crashes also disproportionately harm low-income groups as pedestrians and bicycle and motorcycle riders are the most frequent casualties”
Meanwhile a WHO report in 2004 said that without new or improved interventions, road traffic injuries will be the third leading cause of death by the year 2020.
