Laos-Indochina group to pay debt in September
Laos-Indochina group to pay debt in September
The Lao-Indochina Group Public Company has postponed paying all the money it owes to farmers until September after the company could not pay up on their promise in April.
The company currently owes more than 10 billion kip to local cassava growers who supplied them with the crop, after paying some of the total 17.5 billion kip owed.
The company has already paid all the amounts owing to employees in recent months, according to a senior company official.
The tapioca factory run by the company in Pakngum district, Vientiane will restart in October or November after it temporarily ceased operations in June.
Normally each year the factory operates the processing of tapioca between October and May and ceases operations between June and September.
However, the company still confirmed that it is running business normally despite their financial difficulties.
Factories number one and two have the capacity to produce 480 tonnes of tapioca from 1,200 tonnes of cassava a day.
After the company ran into financial difficulties, the factory started to get less and less cassava as the farmers confidence in them dropped.
To solve their problems the company is seeking foreign business partners to invest.
The Nayoby Bank agreed to suspend the company's interest payments on its loan in August last year.
The company will try to pay all it owes to the bank after it has repaid its debt to the farmers.
The company has encouraged farmers to grow cassava in more than 10 districts in Vientiane and in Borikhamxay and Vientiane provinces.
A number of suppliers to the company switched to growing other commercial crops after they became financially affected.
Some 90 percent of the factory's output is exported to China whilst the rest is sold on the domestic market.
Tapioca powder is found in noodles, snack foods and seasonings. It is also used in the production of clothes, glue, paint, paper, medicine, false teeth and prosthetic limbs.
