Laos economic growth despite challenges

Baoquocte.vn. Laos has maintained sustainable economic growth over the past two and a half years, achieving growth targets despite ongoing challenges and economic measures continuing to gain momentum.

Lào tăng trưởng kinh tế bất chấp thách thức. (Nguồn: ANN)

GNI per capita in Laos is expected to reach 1,712 USD in 2023. (Source: ANN)

Presenting the mid-term assessment report on the 5-year national socio-economic development plan 2021-2025 to the National Assembly recently, Lao Prime Minister Sonexay Siphandone said that the average mid-term growth reached 4.03%, meeting the average growth target of at least 4% according to the 5-year plan.

According to the head of the Lao government , sustainable growth is guaranteed despite the country facing unprecedented difficulties and challenges in many years caused by the domestic, regional and global environment.

Industry recorded the highest growth rate with an average of 4.53%, followed by services (4%), tax and tariffs (3.6%), agriculture and forestry (3.1%).

Foreign exchange earnings from exports to Laos increased from just 31% of total income in 2020 to 41.32% in the first nine months of 2023 and are expected to increase further to 50% for the whole year. This has helped limit strong exchange rate fluctuations and reduce inflation from 40% in mid-2022 to 25.69% in September 2023.

However, the cost of living remains high, weakening households' spending power, while the kip continues to depreciate, meaning Gross National Income (GNI) falls.

In 2023, GNI per capita is expected to be at $1,712, down slightly from $1,729 in 2022 and lower than $2,161 in 2020 and $2,004 in 2021.

Prime Minister Sonexay said the government acknowledged that the exchange rate remains fragile amid the impact of the changing global economic environment. Shortage of foreign exchange and debt repayment are also issues that require joint efforts to resolve.

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