Lao People's Democratic Republic

The 1991 Constitution of the Lao People’s Democratic Republic (Lao PDR, commonly known as Laos) guarantees the principle of gender equality. Although equality is promoted further in a number of specific laws, legal awareness remains low, partly because more women than men are illiterate.

This chapter considers how and if economic reform in Cambodia, Lao PDR, Myanmar and Viet Nam (CLMV) has reduced poverty and income inequality. It opens with a brief introductory section that puts CLMV in a regional context and outlines the themes the chapter addresses. The section on the CLMV experience of poverty and inequality – country by country – examines each country in turn, sketching its history from independence, its experience of war, and its transition from a centrally planned people’s democracy to a market economy in the 1980s and 1990s. In this respect, Myanmar is an exception as it is only now ushering in its first tentative reforms. Cambodia, Lao PDR and Viet Nam, however, have effectively rebuilt and reaped the benefits. Their export-driven economic growth has been strong. Cambodia and Viet Nam have diversified their economies away from agriculture and both are currently fostering eco-tourism and new green industries. All three have reduced poverty – Viet Nam by half. Income disparities, however, persist between men and women, urban areas and rural regions, and ethnic groups. Inequality has actually widened in Lao PDR. CLMV have much to do to ensure development is inclusive and sustainable: further build infrastructure and institutional capacity, widen equitable access to education and employment, make the business environment investor-friendly, invest in human capital, nurture small and medium-sized enterprises, weed out corruption. The section on CLMV countries briefly compares the four countries and their performance in reducing poverty and inequality. Myanmar is a constant exception, principally because so little data are available. However, the final section “Conclusion”, also applies to Myanmar: economic growth does not of itself deliver equally shared benefits for all.

While the Emerging Asian region has positioned itself well to weather short-term economic volatility, it is imperative to ensure that the new growth and development strategies of countries in the region do lead to sustainable growth over the longer term. To this end, there must be structural policy reforms to ensure sustained and robust productivity growth, the cornerstone of every nation’s economic growth and competitiveness. The reforms should also target upgrading of economic activities to ensure that the region’s economies can remain competitive participants in global value chains in the face of changing domestic and external conditions.

This first OECD Investment Policy Review of Lao PDR uses the OECD Policy Framework for Investment to assess the investment climate in Lao PDR and discusses the challenges and opportunities faced by the Government of Lao PDR in its reform efforts. It includes chapters on trends in foreign investment and trade, the legal framework for investment, regulatory restrictions on foreign investment, corporate governance, investment promotion and facilitation, promoting and enabling responsible business conduct, infrastructure connectivity and the investment framework for green growth.

This chapter describes the Lao People’s Democratic Republic’s (Lao PDR) gradual integration in the world economy and the role of trade and investment in its economic development. It reviews trends in foreign direct investment in Lao PDR using various national and international data sources. It also looks at the performance of foreign investment relative to neighbouring and regional economies and its impact on the local economy.

This chapter provides an overview of the responsible business conduct landscape in the Lao People’s Democratic Republic (Lao PDR), outlining the actions the government has taken to facilitate, promote, enable, cooperate on and exemplify responsible business practices. It also provides recommendations for how the climate for responsible business conduct in Lao PDR could be further enhanced with a view to promoting quality investment and sustainable development.

This chapter assesses the investment framework for green growth in the Lao People’s Democratic Republic (Lao PDR).It looks at challenges and opportunities for sustainable economic growth and provides recommendations to improve the regulatory framework for green investment with a particular focus on private participation in renewable energies. It also reviews financing for green growth and how the country faces climate change-related challenges.

This chapter provides an overview of the Lao People’s Democratic Republic’s (Lao PDR) framework for the entry and regulation of investment and reviews existing regulatory restrictions to foreign direct investment. It looks at key policy reforms covering foreign investment and benchmarks the remaining restrictions against those in other countries.

This chapter examines the current context of infrastructure development in the Lao People’s Democratic Republic (Lao PDR). It reviews connectivity challenges and recent reforms to boost infrastructure investment, including private participation in infrastructure, and the remaining obstacles to improving the legal and institutional framework for private investment in infrastructure.