05 Dec, 2025

Laos-China Railway Marks Fourth Anniversary with Record Growth

The Laos-China Railway (LCR) marked four years of operation on 3 December, highlighting its transformative role in turning Laos from a “landlocked” nation into a “land-linked” regional transport hub since its launch in 2021. The railway, as part of China’s Belt and Road Initiative (BRI), has transported over 62.5 million passengers and carried more than 72.5 million tons of cargo so far, state media reported. Cargo Operations Expand DramaticallyRailway cargo operations have expanded significantly, growing from 2 to 23 daily routes over the past four years. The network has transported over 60,000 cargo trips, delivering goods to 19 countries and regions including Laos, Thailand, and Vietnam. More than 3,800 types of goods are now transported along the railway corridor.Advanced digital cargo stations and streamlined customs procedures have improved efficiency, slashing transit times from 40 hours to just 2 to 5 hours. Transport costs have fallen by 30 to 50 percent, making the route increasingly competitive for regional trade.In a milestone for agricultural exports, Laos shipped its first full train load of 1,000 tons of locally produced cassava starch to China via the LCR on 29 November.Tourism and Passenger Services SurgeInternational passenger services have also expanded substantially, with train capacity increasing from 250 to 420 seats per trip. Travelling times are now over 15 hours shorter compared to road travel, benefiting tourism, education, and cross-border business activities.The railway has connected popular destinations including Kunming and Xishuangbanna in China with Luang Prabang and Vientiane in Laos, spurring development of hotels, restaurants, and markets along the route. Regional IntegrationOn a similar development on 2 December, Laos and Thailand have just opened a freight train route connecting Thanaleng Dry Port in Vientiane Capital with Thailand’s Nong Khai Station. Future expansion plans include the Laos-Thailand Railway , which will connect to the LCR through a planned new railway bridge crossing the Mekong River between Vientiane and Nong Khai, set to become the second friendship bridge linking the two cities.

01 Dec, 2025

Laos Steps Up Debt Reforms With New Strategy, Stronger Oversight

Laos is advancing major public debt management reforms with a new medium-term strategy and tighter oversight of state-owned enterprises to strengthen fiscal stability and support economic growth, Deputy Minister of Finance Soulivath Souvannachoumkham said on 25 November.He said the government is drafting a nationwide strategy expected to guide borrowing decisions, improve risk management, and make debt levels more sustainable.Recent steps include the creation of the Public Debt Statistics Division in 2021, which has improved transparency and the accuracy of debt reporting. Oversight of state-owned enterprises, especially Electricité du Laos, has also been strengthened through closer debt monitoring, mandatory reporting, and a temporary halt on new government guarantees to limit high-risk liabilities.Economic Context and Inflation TrendsThese reforms build on progress since the first policy dialogue in October 2023, the official noted. He shared that inflation has fallen from 31.2 percent in 2023 to 4.0 percent in October 2025, the exchange rate has stabilized, and revenue collection has improved.Economic growth reached 4.3 percent in 2024 and is expected to rise to 4.8 percent by the end of  2025, supported by energy exports, recovering tourism, and stronger investor confidence.Recent government data also shows encouraging improvements in the country’s fiscal position, including the repayment of USD 2.45 billion in foreign debt between 2024 and September 2025. Reform progress in the foreign exchange sector has further supported fiscal stability. The establishment of the Lao Foreign Exchange Market has increased market transparency, encouraged greater use of the kip, and enabled more local currency settlements with neighbouring countries. These measures are aimed at reducing reliance on foreign currencies, strengthening the effectiveness of monetary policy, and improving exchange rate predictability.Despite overall improvements, household costs remain a concern. Inflation rose slightly to 4.8 percent in November, driven by higher prices for electricity, water, health care, and education, according to the Lao Statistics Bureau. Raising VAT from 7 to 10 percent has helped boost government revenue but places additional pressure on consumers.Outlook Remains Positive but Risks PersistMeanwhile, the International Monetary Fund (IMF) expects Laos’ economy to grow by 4.5 percent in 2026, supported by exports, tourism, foreign investment, and a supportive fiscal stance. Inflation is expected to rise gradually due to planned fiscal measures and electricity price adjustments.The IMF warned that external pressures and weaknesses in parts of the banking sector remain risks. It said continued reforms, stronger governance, and better oversight of state-owned enterprises will be important for long-term economic stability.