Process or perish as producers seek to promote exports
 
Vientiane Times, 8 Dec 2009
 
The government must do more to facilitate the construction and
operation of processing plants in Laos to secure markets and boost
agricultural output.
 
That is the message from a senior official at the Ministry of Industry
and Commerce, Mr Manohak Rajchak.
 
“We are formulating a new five-year development plan for the industry
sector with a focus on identifying new measures to boost growth in
agricultural processing,” Mr Manohak said on Friday.
 
The next five years of the Lao socio-economic development plan, which
includes a development plan for the industrial sector, will be
implemented from 2011 to 2015.
 
Mr Manohak, who is also Industry Department Director General, made the
remarks on Friday.
 
His comments come amid an increasing supply of agricultural products
in Laos .
 
The increased productivity threatens to create a surplus of several
commodities, with farmers having trouble selling their produce.
 
At the end of 2008, thousands of Lao growers had no markets after a
neighbouring nation closed its doors to sweetcorn imports to protect
its own producers.
 
Lao farmers had to sell their sweetcorn to domestic buyers at low
prices so the crops didn't rot in the fields.
 
Such occurrences have led people to question whether Laos is too
reliant on foreign markets for unprocessed agricultural products.
 
It is widely believed Laos needs facilities that will add value to
agricultural products by processing them before export.
 
Canned or tinned corn, for example, holds its freshness and value over
a much longer period than unprocessed corn.
 
Mr Manohak said the new promotion policy for the industrial sector
will also cover the processing of construction materials.
 
He said he was as yet unable to confirm the new investment promotion
policy for business people seeking to construct and operate processing
plants.
 
The industrial develop-ment plan will be drawn up and approved over
the next two years.
 
According to a report from the Ministry of Planning and Investment,
the government forecasts that growth of the industrial sector over the
current five-year socio-economic development plan will reach 13 to 14
percent.
 
It is set to account for 36 to 37.5 percent of GDP.
 
If the government's 2006-2010 economic development target is achieved,
it will make the industrial sector the main driving force of the
economy ahead of the agriculture and service sectors, expected to
account for 36 and 28 percent respectively.
 
Mr Manohak said development of industrial processing had strong
connections with small and medium size enterprise development.
 
The government had established an SME fund which will help people to
build and operate small and medium-sized processing plants.
 
He said many businesses are investing in new facilities to process
agricultural products including rubber and sweetcorn juice before
exporting them.
 
One of the main challenges for such products entering the market is a
trusted brand name.
 
Since few people know about brand names or the “Made in Laos ”
concept, there is a need to advertise Lao products, according to
officials.