Laos moves to ensure progress

business April 08, 2017 01:00

By VIENTIANE TIMES
ASIA NEWS NETWORK
SAVANNAKHET

THE GOVERNMENT is creating new decrees to ensure the sustainable development of special economic zones in ways that yield strong benefits.



SEZs are economic development areas set up to attract large-scale investors, both Lao and foreign, to spur economic growth and create job opportunities for local people.

Government officials from central and provincial agencies gathered Thursday in Vientiane to discuss a draft decree on the promotion and management of SEZs.

Up for discussion was a draft decision on the work of SEZ management committees that would ensure the directives contained in the Investment Promotion Law were effectively carried out.

These decrees are aimed at simplifying procedures for investors, making them faster, more transparent and fair, and ensuring that investors have confidence in the system and are not taken advantage of by the authorities, Deputy Minister of Planning and Investment Khamlien Pholsena said. The decrees would also help the management committee in each area to better promote and develop the area under its responsibility. 

It was learnt that they had struggled in the past due to misunderstanding on the part of various sectors.

The draft decree on the promotion and management of SEZs comprises 13 chapters and 62 articles. The decree has three parts – establishing and investing in SEZs, investment promotion policy for developers and investors, and organisational structure at the macro and micro levels.

Decisions concerning the allocation of specific areas to investors are also the responsibility of SEZ management committees. 

SEZs were established in Laos in 2002, starting with the Savan Seno Special Economic Zone, which was the testing ground for this form of economic development, Khamlien said. Since then the number of SEZs in Laos has grown steadily, he added.

Laos has 12 SEZs covering more than 19,600 hectares. Investment has reached US$1.6 billion (Bt55.4 billion), of which $24 million was invested by the government, $1.27 billion by developers and $349 million by retail investors.

The total number of domestic and foreign companies is now 318 companies and businesses. 

Of these companies, 57 are privately owned Lao concerns, 239 are foreign owned and 22 are joint ventures of Lao and foreign companies. The service sector accounts for 40 per cent of SEZ operations, while 32 per cent is industrial and 28 per cent commercial. Jobs have been created for 15,544 people, of whom 7,180 are Lao nationals and 8,364 are foreign.

SEZs have contributed $16 million to the national budget and this figure is expected to more than double in the future, as many factories have been built and some are now starting production.