Laos sets 4% annual GDP rise goal
Laos sets 4% annual GDP rise goal
The Lao government has set an annual economic growth target of at least four per cent from now until 2025, even though there is no indication as to when the Covid-19 outbreak will be contained.
The agriculture sector is expected to grow at an average annual rate of 2.5 per cent and will represent 15.3 per cent of gross domestic product (GDP) by 2025, according to a decree signed by Prime Minister Phankham Viphavanh.
The 20-page decree also states that industry is projected to grow at an annual rate of 4.1 per cent and will comprise 32.3 per cent of GDP by 2025, while the service sector is set to grow at six per cent, accounting for 40.7 per cent of GDP in the next three-to-four years.
In addition, the tariff and tax sector is forecast to grow by 5.8 per cent and should represent 11.7 per cent of GDP by 2025.
The government believes that annual GDP per capita income will reach $2,880 by 2025.
Lao National Chamber of Commerce and Industry (LNCCI) vice-president Daovone Phachanthavong said Laos can achieve its economic goals if mega development projects progress as planned.
These projects include smart cities, expressways, special economic zones, hydropower, mining and other forms of infrastructure development, which should give a major boost to GDP growth.
However, one of the biggest challenges will be the government’s ability to quickly rein in the Covid-19 outbreak and then expedite economic recovery.
The government has pledged to carry out a number of priority programmes to boost economic growth until 2025.
These include two national agendas to address economic and financial difficulties and drug trafficking.
Secondly, the government will modernise the revenue collection system and address financial leaks in a further move to boost national income.
Thirdly, the government is keen to reduce its chronic debt burden by turning debt into capital, state assets, shares and mining, while limiting the number of loans it takes out.
In addition, the prime ministerial decree highlighted the importance of managing currency exchange rates and inflation to minimise the hardship caused to the general public.
The government has vowed to remove red tape and replace it with red carpet, in order to attract more foreign investment and generate more jobs for local people.
According to the decree, it is essential to capitalise on the potential offered by the Laos-China Railway to boost productivity and develop the processing industry, so that goods produced along the railway can be easily exported.
The sectors concerned have been instructed to promote the Lao Visit Laos tourism campaign and improve tourism-related facilities and products so as to strengthen the tourism industry.
The government will further promote public-private partnerships as a means of transferring technology and capital to Laos, to boost infrastructure development.
Government bodies have also been advised to promote small- and medium-sized enterprises (SME) and ensure that value is added to Lao products destined for export.
