Laos is facing a challenge with respect to foreign currency outflow, which is more than the amount of foreign currency entering the country through the banking system.
The year-on-year inflation rate in Laos surged to 9.9 per cent in April, the highest figure recorded since January 2016, according to the latest report from the Lao Statistics Bureau.
Laos registered record two-way trade of $1.100 billion, including exports of $600 million and imports worth approximately $500 million, in March, resulting in a trade surplus of $100 million.
Laos recorded a trade surplus in the first three months of this year, despite the continuing depreciation of the kip and rising the cost of production and consumables.
The value of trade between Laos and Vietnam last year soared to $1.37 billion, up 33.32 per cent from 2020, with the value in the first two months of this year rising by 15.39 per cent to nearly $243.2 million, according to the Lao Ministry of Industry and Commerce.
The year-on-year inflation rate in Laos surged 8.5 per cent in March, even more than expected, and rose to the highest figure recorded since January 2016.
Lao's economy is projected to grow 3.4 per cent this year and 3.7 per cent in 2023, due to the country’s investments to boost exports, according to the Asian Development Outlook (ADO) 2022 released by the Asian Development Bank (ADB) on April 6.
Trade between Laos and Vietnam is expected to grow this year even as the two countries continue to battle the Covid-19 pandemic, inflation, and the spiralling price of fuel.
Laos’ year-on-year inflation rate jumped to 7.3 per cent last month, the highest figure recorded in the Southeast Asian country since January 2016.
Fuel prices have increased six times in a period of just two months and 10 days, sparking greater concerns about the rising cost of living in Laos.