24 May, 2017
The Lao People’s Democratic Republic, also commonly known as the Laos, is situated in the Mekong River Delta region and shares borders with the People’s Republic of China, the Kingdom of Cambodia, the Socialist Republic of Vietnam, the Kingdom of Thailand, and the Republic of the Union of Myanmar. It has a total area of 236,800 square kilometers and a population of about 6.8 million people. It is a land-locked country with abundant natural resources mostly mineral, hydropower, and timber.
Since its independence in 1975, the country has followed a socialist-oriented centrally-planned economic management style until market-oriented reforms were implemented in 1986, giving the private sector an increasingly central role in the economy.
The government has been successful in progressively building institutions, modernising the economy, and significantly reducing poverty. In 2011, the World Bank raised the Lao PDR’s income categorisation from a low income to a lower middle income economy, and the government seeks to graduate from ’least developed country’ status by 2020.
Among the government’s two key stated objectives, political stability and sound macroeconomic management, have contributed to the recent economic success.
The Lao PDR became a member of ASEAN in 1997. The creation of the ASEAN Economic Community (AEC) in 2015 is highly relevant for economic development in the Lao PDR. It has established a single market with 625 million consumers and a purchasing power of USD2.3 trillion. For the Lao PDR, the AEC offers great potential for economic development through improved access to the regional market. As a single production base, it also increases the opportunities for the Lao PDR to participate in regional value chains. ASEAN member states already account for more than half of the Lao PDR’s total foreign trade.
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For more information, please contact:
Aristotle David, Managing Partner, ZICO Law Laos
aristotle.david@zicolaw.com
