Access to finance a stumbling block for agribusiness
Access to finance a stumbling block for agribusiness
The Lao Agro Processing Association recently called on the government to prioritise access to finance a nd banking policy in a bid to shore up collapsing agribusiness operators.
“Many members of the association are experiencing difficulties accessing finance and some have stopped operating after being unable to obtain capital,” association President Phouvong Korasak said at a recent meeting in Vientiane.
He said many members had gone bankrupt because they could not obtain the funding they needed to run a profitable business.
“If the government is able to create a clear policy on access to finance and ensure proper banking support for agribusiness in Laos, it would also enable us to bolster food security in the country,” he added.
Mr Phouvong said the matter had been submitted to the 8th Lao Business Forum in 2013 and some policies had been put in place by the government earlier this year.
“I agree with the government's general policies on banking and finance, but we need more explicit policies to boost active operations in the agribusiness sector,” he said.
The Lao Agro Processing Association was established in 2009 with a large number of businesses registered as members.
“Although the association has many members, coordination among them is inefficient and many are still operating independently of other members,” Mr Phouvong said.
He also called on provincial Industry and Commerce Departments to maintain tight controls on unauthorised businesses and ensure the government's guidelines and regulations were strictly adhered to.
A recent national consultative meeting between the government and business sector was chaired by Deputy Prime Minister Dr Bounpone Bouttanavong who is in charge of macroeconomic affairs and services.
Dr Bounpone urged the business sector to officially file a request outlining their requirements with the government so the request can be considered in the near future.
At the meeting, ministers, deputy ministers, entrepreneurs and related business sectors shared their opinions and experiences in the fields of business connectivity, the effective management of businesses, access to finance, and improvements to regulations as key factors for regional and international cooperation.
The government is now promoting agricultural production with a view to the expansion of exports when the Asean Economic Community comes into effect at the end of this year.
But limitations to production ca pacity, funding shortages and a dearth of skilled workers continue to be major challenges for successful regional business integration.
