Local expert confident of economic growth
 
Vientiane Times, 17 Dec 2009
 
A top Lao economist has expressed confidence the government can
achieve its economic targets this fiscal year despite the negative
impacts of the global economic recession and serious flooding in the
southern provinces.
 
Lao National Economic Research Institute Director General, Dr Sirivanh
Khonthapane, made the comment on Tuesday as the government pursues the
first quarter of the 2009/2010 socio-economic development plan.
 
Under the plan, the government aims to maintain GDP growth at 7.5
percent this fiscal year, creating an economy worth 54,100 billion
kip.
 
The 25th SEA Games and the 450th anniversary of Vientiane as the Lao
capital would be the main drivers of the economy this fiscal year, she
said.
 
She said these major events would inject a large amount of money into
the economy, in particular in the areas of infrastructure development
and tourism.
 
Dr Sirivanh said the government had effective measures in place to
respond to the global financial crisis and flooding in Attapeu,
Saravan and Xekong provinces. These would ensure steady growth of the
economy would continue.
 
Next year the Nam Theun 2 hydropower plant will start commercial
operation. In addition foreign investors are expected to resume major
schemes such as power plants in Laos , which will also boost economic
growth this fiscal year.
 
According to the Ministry of Planning and Investment, the government
has made a strong commitment to increase output from the agriculture
and forestry sector by 3 percent, which will account for 30 percent of
GDP growth.
 
Industrial productivity is expected to increase by 13.4 percent,
accounting for 27 percent of GDP, while it is planned that output from
the service sector will increase by 7.2 percent, accounting for 37
percent of GDP.
 
The government plans public investment of about 5,125 billion kip this
fiscal year and will encourage the private sector, both domestic and
foreign, to invest about 16,230 billion kip or 30 percent of GDP to
ensure economic growth is on target.
 
The government will try its best to keep inflation at one digit. Its
goal is to keep the exchange rate of the Lao kip against major
currencies within a five percent rate of change.
 
Other economic targets include producing about 3.3 million tonnes of
rice, about 7,281 million kw/h of electricity, and industrial output
worth about 434 billion kip. It is planned that the total export value
will rise above US$1 billion and the telecommunication network will
reach 80 percent of villages nationwide. Tourist arrivals are expected
to reach 2 million.
 
The government plans to collect 10,653 billion kip in revenue and has
an expenditure budget of about 12.470 billion kip, which results in a
budget deficit of 3.36 percent.