(KPL/VNA) – Despite the Lao Government's efforts to lower prices of goods and services, the inflation rate in the country remained high in 2023, averaging 31.2%, according to the Lao Statistics Bureau.

The bureau’s report shows that the Southeast Asian country's inflation rate in December dropped 0.84% from the previous month to 24.4%.

The weak kip is seen as one of the main factors driving inflation, while low domestic production capacity and high import values have increased pressure on the exchange rate, the report said, adding that the control and regulation of domestic goods prices has not met expectations.

According to the report, the sectors witnessing the largest price increase in December were hotels and restaurants, up to 35.9% year-on-year. They were followed by the clothing and footwear industry (up 33.4%), health care and medicine (up 29.5%), household appliances (25.9%), alcohol and tobacco (25.1%), and food and non-alcoholic drinks (24%).

The State Bank of Laos said that although export and tourism sectors have shown an upward trend, the country continues to face challenges due to its large import values and foreign debt, and it will be vulnerable to external influences, including conflicts in the Middle East and other parts of the world.

To deal with the above-mentioned problems, the State Bank of Laos will continue to tighten monetary policy and take measures to stabilise the value of the kip – the key factors in regulating prices of goods and services.

The bank also pledged to regulate foreign currency and ensure more revenues from exports, and more investments in the country through its banking system.

KPL