THE GOVERNMENT has acknowledged the need to restructure its economic growth base as part of efforts to ensure the sustainability of national development.
Speaking at a news conference after the monthly government meeting in Huaphan province last week, government spokesman Dr Chaleun Yiapaoher said one of the main challenges that Laos needs to address is that economic growth is still based on the exploitation of natural resources. This does not enable sustainable development, he said.
“Economic growth is based on the exploitation of natural resources, in particular hydropower development,” he told local media as he talked about what the government plans to do to address the shortcomings.
To put Laos back on the track of sustainable development, Dr Chaleun said the government needs to shift its economic growth base from the exploitation of natural resources to job creation and income generation. This would help to sustain countrywide development.
According to the Asian Development Bank, improvement of agriculture will create jobs and income for Lao people as most are employed in this sector. The sector’s modernisation will boost incomes and raise more people above the poverty line.
Another challenge the government plans to address is rising public debt, Dr Chaleun said. It will take several years for the government to resolve this problem, he added.
According to data collected by the IMF from Lao officials and the sectors involved, the level of public and public guaranteed debt was projected to rise from 58.5 per cent of GDP to 61.1 percent in 2017, to 65.3 per cent in 2018, and to 65.9 per cent in 2019.
GDP was valued at US$16 billion in 2016.
Dr Chaleun said that in order to secure a strong financial position over the coming years, the government needs to accelerate modernisation of the revenue collection system.
Apart from that, the government needs to shift its development focus from the construction of infrastructure to commercial production. This will generate more jobs and boost incomes, he said.