Laos outlines investment priorities

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vientianeIn the next financial year the Lao government will allocate 11 per cent of its state investment budget to four priority areas with aims to stabilise national economic growth, the state-run daily Vientiane Times reported on July 10.

The funds amounting to some 3,300 billion Lao kip ($410.55 million ) will be used to pay the country’s debts, contribute to donor funded development projects, fund ongoing projects, and to launch new investment projects.

The information was presented in a report by Minister of Planning and Investment Somdy Duangdy detailing the government’s socio-economic development plan for 2014-15. The report comes during the ongoing Lao National Assembly session here in the capital.

In the 2014-15 financial year the Ministry of Planning and Investment and the Ministry of Finance have agreed that various sectors and local authorities will have to allocate at least 35 per cent of their budget to the payment of debts. Debt payments will be concentrated on completed projects, the report said.

Additionally some sectors and authorities will have to allocate some of their budget to pay outstanding debts outlined in the government’s proposed budget adjustment for the 2013-14 financial year.

The Lao economy has experienced a slowdown since the suspension of prior investment projects and projects conducted without the National Assembly ‘s approval. The government has consequently moved to cut its expenditure in infrastructure development projects such as roads and public offices, the paper said.

Ministries, organisations and local authorities must stop operating unauthorised private investment projects in line with a recent prime ministerial order.

Changes in the government’s investment strategy have occurred after the country encountered a revenue shortfall last financial year. Subsequent economic impacts have not only effected economic growth but some construction companies which have had to change their business plans to survive the financial difficulties.

Projections for the 2013-14 financial year put the Lao economic growth at around 7.6 per cent, somewhat lower than the previous target of 8.3 per cent. For the financial year 2014-15 the government has projected GDP growth of 7.5 per cent. Reaching GDP growth of 7.5 per cent in 2014-15 will require a financial injection of some 39,690 billion Lao kip ($4.94 billion).

Given that the government has forecast revenue collection for 2013-14 falling 10 percent short of its target a proposal has been presented to the NA asking to cut targets for both revenue collection and planned expenditure.

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Reading Time: 2 minutes

In the next financial year the Lao government will allocate 11 per cent of its state investment budget to four priority areas with aims to stabilise national economic growth, the state-run daily Vientiane Times reported on July 10.

Reading Time: 2 minutes

vientianeIn the next financial year the Lao government will allocate 11 per cent of its state investment budget to four priority areas with aims to stabilise national economic growth, the state-run daily Vientiane Times reported on July 10.

The funds amounting to some 3,300 billion Lao kip ($410.55 million ) will be used to pay the country’s debts, contribute to donor funded development projects, fund ongoing projects, and to launch new investment projects.

The information was presented in a report by Minister of Planning and Investment Somdy Duangdy detailing the government’s socio-economic development plan for 2014-15. The report comes during the ongoing Lao National Assembly session here in the capital.

In the 2014-15 financial year the Ministry of Planning and Investment and the Ministry of Finance have agreed that various sectors and local authorities will have to allocate at least 35 per cent of their budget to the payment of debts. Debt payments will be concentrated on completed projects, the report said.

Additionally some sectors and authorities will have to allocate some of their budget to pay outstanding debts outlined in the government’s proposed budget adjustment for the 2013-14 financial year.

The Lao economy has experienced a slowdown since the suspension of prior investment projects and projects conducted without the National Assembly ‘s approval. The government has consequently moved to cut its expenditure in infrastructure development projects such as roads and public offices, the paper said.

Ministries, organisations and local authorities must stop operating unauthorised private investment projects in line with a recent prime ministerial order.

Changes in the government’s investment strategy have occurred after the country encountered a revenue shortfall last financial year. Subsequent economic impacts have not only effected economic growth but some construction companies which have had to change their business plans to survive the financial difficulties.

Projections for the 2013-14 financial year put the Lao economic growth at around 7.6 per cent, somewhat lower than the previous target of 8.3 per cent. For the financial year 2014-15 the government has projected GDP growth of 7.5 per cent. Reaching GDP growth of 7.5 per cent in 2014-15 will require a financial injection of some 39,690 billion Lao kip ($4.94 billion).

Given that the government has forecast revenue collection for 2013-14 falling 10 percent short of its target a proposal has been presented to the NA asking to cut targets for both revenue collection and planned expenditure.

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