15 Apr, 2024

Lao GDP Forecasted to Grow in 2024-2025, Says Asian Development Bank

Laos is expected to see moderate economic growth this year and next year, largely driven by external demand fueled by tourism and trade, as outlined in the latest Asian Development Bank (ADB) report.The ADB’s “Asian Development Outlook for April 2024” predicts that Laos’ gross domestic product (GDP) will rise by 4% in both 2024 and 2025. The growth in services will be sustained by external demand, with international tourist arrivals forecasted to reach 4.2 million in 2024, propelled by improved infrastructure connectivity.The report also highlights the role of foreign investment in renewable energy, driving moderate industrial growth. Projects like the Monsoon Wind Power, scheduled for completion in 2025, are expected to contribute to this growth. However, macroeconomic pressures continue to pose challenges to the country’s economic outlook.Sonomi Tanaka, ADB Laos Country Director, noted some improvement in the economy in 2023, primarily driven by sectors such as tourism and trade. Nonetheless, ongoing challenges such as high debt and inflation have slowed down the country’s economic advancement.In the first quarter of 2024, Laos experienced an overall inflation rate increase of 24.93% compared to the same period last year. Specifically, inflation stood at 24.4% in January, 25.35% in February, and 24.98% in March.Inflation is anticipated to continue rising as businesses adjust prices to deal with increased expenses from currency depreciation and wage hikes, with consumer prices predicted to go up by an average of 20% in 2024, slowing down to 7% in 2025 after a 31.2% surge in 2023.This inflationary trend has led to a decline in household purchasing power, particularly affecting food, hotel, and restaurant prices. As a result, more students are dropping out of school, and labor migration is increasing as individuals seek employment opportunities.Additionally, high inflation and economic challenges have exacerbated food insecurity in the country, with one in seven people experiencing shortages in 2023. Rural areas are particularly affected, facing twice the rate of food shortages compared to urban areas. This has led to slowed growth due to malnutrition, impacting a child’s productivity over their lifetime.To tackle these challenges, the Lao government has collaborated with development organizations to expand social assistance, enhance healthcare services, and invest in clean water and sanitation.

10 Apr, 2024

Mekong Day Celebrations Emphasize Cooperation, Conservation Efforts

Representatives from Mekong Basin nations, along with development partners, convened at the Mekong River Commission (MRC) Secretariat to mark the 29th Mekong Day, focusing on initiatives to preserve and improve the health of the Mekong Basin.The highlight of the event was the third State of the Mekong Address delivered by Anoulak Kittikhoun, the CEO of the MRC Secretariat. Kittikhoun provided an overview of the current state of the Mekong River Basin, outlining progress, challenges, and strategies for sustainable management and development.“For 29 years, I can confidently say that our Mekong countries have cooperated far more than they do not, in areas that affect the Mekong,” Kittikhoun commented, “This year we will release our highly anticipated State of the Basin Report as well as the Mekong Atlas. Compared to 5 – 10 years ago, the Mekong has changed dramatically, for better and worse. Among better news, the Mekong region has continued to enjoy peace, which sadly is not the case everywhere in the world.”The economic output of the Mekong basin reached USD 63 billion annually, driven by sectors such as hydropower, rice production, tourism, navigation, and aquaculture. Despite challenges, the Mekong remains home to the largest inland wild fisheries globally, generating significant revenue.Socially, there has been progress with improved access to food, clean water, sanitation, and electricity, leading to reduced rates of malnutrition and water-related diseases across the Mekong countries.However, environmental challenges persist. Erratic hydromet conditions, including droughts and floods, have impacted the region. Declining trends in sediment balance, salinity intrusion, and plastic pollution pose threats to the ecological health of the Mekong.Efforts to address these challenges are ongoing, with initiatives such as sediment monitoring showing positive results in certain areas. CEO Kittikhoun called for cooperation among countries, strengthening relations with upstream riparian China, building ties with ASEAN, and maintaining partnerships worldwide.The MRC also announced the continuation of the “Transboundary Water Cooperation in the Lower Mekong Basin” project in collaboration with the German government, emphasizing the commitment to fostering transboundary cooperation and sustainable water management in the region.Annette Knobloch, the German Ambassador to Laos, highlighted the importance of international cooperation in water resource management for the peaceful and sustainable future of the region.“Through the Transboundary Water Cooperation Project (TWC), Germany will continue to cooperate with the Mekong River Commission on its pathway to provide services for an integrated water resources management, not only along the Mekong core river but as a basin-wide approach,” said  Knobloch.Additionally, the Canadian government also provided CAD 2 million (about USD 1.48 million) to the MRC for institutional development, emphasizing the significance of water resource governance in the Mekong Basin as a priority area for Canadian engagement.These Mekong Day celebrations showcased the collective efforts to address challenges and promote sustainable development in the Mekong Basin, highlighting the importance of cooperation and partnership in safeguarding the region’s future.