(KPL) The economy of the Lao PDR is experiencing a moderate recovery, backed by tourism, transport, and logistics according to the Asian Development Bank.

ADB projects GDP growth in 2024 and 2025 at 4%, according to report of the Executive Macroeconomic Working Group Consultation Meeting 2024 held here on 5 June.

“Currency depreciation and domestic inflation remain high. Increasing reliance on the domestic market for financing high external debt maturities squeezes the domestic finance market,” said Country Director Lao PDR Resident Mission, Asian Development Bank, Ms Sonomi Tanaka.

Ms Tanaka mentioned continuing macroeconomic imbalances pose risks to price stability, and food security, giving hardship to people across the country. Prolonged tight fiscal conditions have had already significantly negative impacts on investing in the future generation, including through education, health, and human capital development, and investment in adaptation and preparedness for worsening climate and disaster impacts. 

The meeting was attended by Vice Minister of Planning and Investment, Ms Phonevanh Outhavong, Mr. Alex Kremer, Country Manager, World Bank and relevant officials.

The meeting aimed to discuss and exchange point of view on implementation of the national socio-economic development plan and the next last six month of 2024, related the state budget plan and currency. As well as the meeting also discussed on  revising the Lao PDR's investment promotion law which is an important piece of legislation in order to be appropriate and in line with the current investment situation, aiming to make the difficulties and challenges to be improved and solved in a consistent and timely manner.

“This meeting is great importance to the implementation of the 9th Five-year National Socio-Economic Development Plan and the creation of the 10th 5-year development plan, especially the management and adjustment of the macro-economy to be more effective and contribute to the solution of economic and financial difficulties such as the exchange rate and weak kip,” said Ms Phonevanh.

During this year’s Round Table Meeting in February, I have emphasized the importance of acknowledging that business as usual would no longer work, and that more drastic reforms for improving economic governance would be crucial.

KPL