Laos witnesses economic growth despite ongoing challenges

Laos has sustained economic growth over the past two and a half years, which have achieved growth targets, despite ongoing challenges.
Lào tăng trưởng kinh tế bất chấp thách thức. (Nguồn: ANN)
Laos' GNI per capita is projected at 1,712 USD in 2023. (Photo: ANN)

Presenting the midterm review report on the five-year National Socio-economic Development Plan for 2021-2025 to the National Assembly on Tuesday, Lao Prime Minister Sonexay Siphandone said midterm average growth reached 4.03 percent, which meets the average growth target of at least 4 percent set in the five-year plan.

According to the premier, sustained growth was secured despite Laos facing great difficulties and challenges not experienced for years, caused by the domestic, regional and global environment

Industry recorded the highest growth rate of 4.53 percent on average, followed by services, taxes and tariffs, and agriculture and forestry at four, 3.6, and 3.1 percent respectively.

The amount of foreign currency earned from exports which entered Laos increased from just 31 percent of total earnings in 2020 to 41.32 percent during the first nine months of 2023. It is expected to rise further to 50 percent for the whole year.

This achievement has helped mitigate the strong fluctuation of exchange rates and reduced inflation from 40 percent in mid 2022 to 25.69 percent in September 2023.

However, living costs remain high, undermining households’ spending power, while the continuing depreciation of the kip means declining Gross National Income (GNI).

In 2023, GNI per capita is projected at 1,712 USD, down slightly from 1,729 USD in 2022. The GNI figures declined from 2,161 USD in 2020 and 2,004 USD in 2021 due to the weaker value of the kip.

The government admitted that currency exchange rates remain fragile amid the impacts of the changing global economic environment. Insufficient foreign exchange and debt servicing are also an ongoing issue that require a collective effort to resolve, Prime Minister Sonexay said.

Vietnam’s economic growth projected to rebound in 2024: WB Economist
Exports, investments remain Vietnam’s economic growth driver: Insiders
Forecasts for Vietnam’s economic growth in 2023
Greater efforts needed to achieve economic growth targets for 2023: official
Vietnam, Laos, Cambodia NAs boost economic cooperation for sustainable development