16 Jan, 2026

Laos Targets 6 Percent Economic Growth in 2026 Amid Reforms, Election Preparations

The Lao government has set a target of at least six percent economic growth in 2026, supported by fiscal reforms, major infrastructure projects, and preparations for national elections, officials said.

Government Spokesperson Sonexay Sitphaxay announced the target on 13 January following the Second Enlarged Government Meeting held from 12 to 13 January.

A key pillar of the 2026 agenda is strengthening public finances. Authorities aim to raise state revenue to at least 20 percent of gross domestic product through reforms to modernize tax and revenue collection systems.

Officials said the measures are intended to close tax gaps, improve compliance, and increase efficiency.

Inflation control remains a priority after consumer prices declined from a peak of 31.23 percent in 2023 to 23.13 percent in 2024 and 7.7 percent in 2025.

The government is implementing policies to stabilize the exchange rate, strengthen the Lao kip, and expand the use of local currency in regional trade.

Infrastructure and Energy Development

Alongside fiscal measures, the government is emphasizing infrastructure development as a long-term driver of growth and regional integration.

Several large-scale projects have been approved or are moving into early implementation stages.

Among them is Phase I of the Laos–Vietnam railway, a 147-kilometer section linking Thakhek district to the Laos–Vietnam border in Khammouane Province under a build-operate-transfer model.

The project is expected to complement existing rail connections with China and Thailand. Plans are also underway for a second railway bridge across the Mekong River linking Vientiane Capital with Thailand’s Nong Khai Province.

Energy development remains another core pillar of the growth strategy, supporting both domestic demand and power exports to neighboring countries.

The sector continues to attract investment in clean energy and cross-border transmission. Reflecting this push, Laos inaugurated a 1,000-megawatt solar power plant in Oudomxay Province in mid-December 2025, the largest such facility in the country to date.

The government is also preparing for elections to the 10th National Assembly scheduled for 22 February, while continuing efforts to graduate from least developed country status in 2026.

Under the 10th Five-Year National Socio-Economic Development Plan for 2026–2030, authorities are targeting average annual economic growth of at least six percent, with gross domestic product per capita projected to reach USD 3,104 by 2030.

19 Jan, 2026

Laos to Export Electricity to Singapore Under Regional Power Agreement

Laos has taken another step toward expanding regional electricity exports after a new agreement cleared the way for Lao-generated power to be transmitted to Singapore through neighbouring countries.On 14 January, Malaysia’s Tenaga Nasional Berhad, Electricité du Laos, and the Electricity Generating Authority of Thailand signed the Phase 2 Energy Wheeling Agreement under the Lao PDR–Thailand–Malaysia–Singapore Power Integration Project. The first phase was signed in 2022 with a two year period that ended on June 22, 2024.The agreement, which takes effect immediately and will run for two years, allows electricity produced in Laos to be sold and delivered to Singapore using existing transmission networks in Thailand and Malaysia.Under the arrangement, Laos can export between 30 and 100 megawatts of electricity, with Electricité du Laos paying wheeling fees for the use of Malaysia’s transmission infrastructure.Officials said the deal completes the operational framework for the project’s second phase, reinforcing Laos’ role as a regional power supplier and advancing cross-border electricity trade within ASEAN.The agreement comes as Laos continues to expand its clean energy sector. In recent years, the country has signed major investment deals to develop large-scale renewable power projects and strengthen regional grid connectivity.Among them is a USD 1.45 billion agreement with Chinese and Singapore-based partners to develop an 1,800-megawatt clean energy project in Xekong Province, scheduled for completion by early 2030.Laos is also progressing with the Lao–China 500-kilovolt interconnection project, due for completion in 2026, which will enable the exchange of up to 1,500 megawatts of electricity and the transmission of around 3 billion kilowatt-hours of clean energy annually.Authorities say these agreements and infrastructure projects support Laos’ long-term strategy to position itself as a regional clean energy hub while deepening power integration across the Mekong subregion and ASEAN.

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14 Jan, 2026

Asia Development Bank Backs Urban Planning for Resilient and Sustainable Cities in Laos

The Asian Development Bank (ADB) has approved a USD 700,000 grant to support feasibility studies and project preparation for more resilient and sustainable urban development in Laos, as the country faces rapid urbanisation and growing tourism demand.An inception workshop for the Feasibility Study for Resilient and Sustainable Urban Improvement Project was held on 12 January, chaired by Deputy Minister of Public Works and Transport Detsongkham Thammavong. The meeting brought together 58 participants from line ministries, provincial and district authorities, ADB, and consulting firms.According to officials, the workshop reviewed the overall project scope and progress made during the preparation phase. Participants discussed priority sub-projects, agreed on an implementation timeline, and examined work plans, technical guidelines, and coordination mechanisms between government agencies and the advisory team.The ADB grant will finance technical studies to identify and prioritise future urban infrastructure investments. Key focus areas include urban planning, road and transport networks, drainage and flood management systems, riverbank protection, bridges, and solid waste management facilities.Authorities said the project aims to strengthen the resilience and sustainability of urban infrastructure while improving service delivery for both residents and visitors. Target areas include Xay District in Oudomxay Province and Namtha District in Luang Namtha Province, both of which are experiencing increased development pressure.Project preparation began in September 2025 and is currently in the data collection and sub-project assessment stage. The feasibility study is expected to conclude in August 2026, with findings intended to guide future investment projects aligned with Laos’ long-term urban development strategy.

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