28 Nov, 2023
Laos Grapples with 25.2 Percent Inflation in November
Laos recorded a 25.2% inflation rate in November, marking a slight drop from the previous month.
The surge in inflation rates hit various sectors hard, like restaurants, clothing, healthcare, and more. Specifically, restaurants and hotels saw a 35.2 percent increase, clothing and shoes went up by 31.8 percent, and healthcare rose by 26.5 percent.
In the clothing and shoes category, prices for items like men’s jackets, shirts, and trousers, as well as women’s and children’s clothing and shoes, increased by 3.5 percent.
Similarly, the restaurant and hotel category rose by 2.9 percent, affecting popular items like grilled paninis, pork rice, and beef patties. Health care and medicine, including paracetamol, jelly lotion, bandages, and children’s medications, also rose by 2.6 percent.
Housing, electricity, water, and cooking fuel categories saw a 2.2 percent increase, affecting items like cement, car maintenance, and external paint.
Meanwhile, the general inflation trend saw a slight decrease of 0.6 percent in the food and non-alcoholic beverages category. This was primarily due to reductions in the prices of rice, fresh fruits, and fresh vegetables. However, some items, such as vegetable oil and raw chilies saw price hikes, and consumers are urged to stay informed about these fluctuations as they navigate their daily expenses amidst the changing economic landscape.
The depreciation of the Lao kip, influenced by a shortage of labor as workers seek better-paying jobs overseas, is a major contributor to inflation.
Despite official reports of a declining inflation rate, many on social media express dissatisfaction, questioning the accuracy of government figures.
One Facebook user commented, “I’m not convinced the inflation rate is going down. It seems to me like it has tripled!”
Another user questioned the measurement methods, saying, “How do they even calculate the rate? We all know it’s the opposite of what they’re reporting.”
In a bid to combat the soaring inflation rate, the Bank of the Lao PDR (BOL) has set a target to reduce inflation to 9 percent or another single-digit figure by the end of 2024. The central bank plans to tighten monetary policy enforcement to increase the domestic money supply and ensure that income from exports enters the banking system. Efforts will also focus on aligning currency exchange rates with market mechanisms, enhancing foreign currency exchange flexibility, and improving services provided by commercial banks.