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Headlines:
Power Deal Takes Two Years and One Coup
Inflation Finally Behaves
Landlocked Nation Chases $38 Billion
World Bank Backs Teachers and Nurses
Tourism Targets Stretch Credulity
Drug Busts Pile Up
QR Codes Replace Cash
Burn Ban Battles Annual Smog
Coffee Cracks $100 Million
Tether Targets 10,000 Crypto Converts
Power Deal Takes Two Years and One Coup
Malaysia’s state utility just signed a deal to send 100 megawatts from Laos to Singapore, the revival of a project that’s been stalled since mid-2024. The holdup was not technical: Malaysia’s energy minister says Thailand’s prime minister getting removed by a constitutional court in August forced a stop of negotiations. This transmission is enough to supply about 1.3% of Singapore’s peak demand, yet it took four utilities, six high-level witnesses in Bangkok, and two years of negotiations to restart. The ASEAN Power Grid is now trying to double cross-border volumes from 100 to 200 megawatts over the next two years at a pace that shows how fragile electricity cooperation can get when a court ruling in one country severs the flow of power across an entire region.
Read more: Business Times (Project Timeline), Asian News Network (Official Signatories), Laotian Times (Future Projects)
Inflation Finally Behaves
Inflation dropped to 7.7% last year from a brutal 23.13% the year before, with the central bank reporting stable exchange rates and foreign reserves that are sufficient to buy more than six months of imports. Traders at the Lao Market in Vientiane say customer traffic is picking up as people are becoming less concerned about high prices, though meat, fish, and vegetables remain expensive. The Lao People’s Revolutionary Party is shooting for 6% annual GDP growth from next year through 2030. Whether the economy cooperates with the Party’s five-year plan remains to be seen, but at least shoppers are venturing back to the market.
Read more: Laotian Times (Inflation Details), The Star (Market Recovery), Asian News Network (Economic Indicators)
Landlocked Nation Chases $38 Billion
The government is betting that geography can be to its advantage, and as such, is looking to bring together $38 billion in investment over five years. That’s more than half again its previous target and they hope that they’ll be able to muster enough private and foreign capital to cover roughly two-thirds of the amount. Officials know that they’re trailing Thailand and Vietnam in the regional investment race but point to lower operating costs and a railway that cuts transportation costs by 20-40%. A new investment law will offer sweeteners like a 5% income tax cap for specialists, but skill gaps and policy uncertainty are issues that so far remain unsatisfactorily unresolved.
Read more: AMRO Asia (Investment Law Details), The Star (Investment Targets)
World Bank Backs Teachers and Nurses
The World Bank has committed to a $35 million project to improve teacher and health worker performance over six years, to backfill a sharp drop in public spending on education and health from 4.9% of GDP in 2013 to an estimated 2.3% in 2023. The money will support professional development for teachers through classroom observation and training programs as well as expanding health worker registration across eight provinces. The project will try to address staffing shortages in rural areas with investments including smart classrooms and training at district hospitals.
Read more: Laotian Times (Spending Trends), The Star (Retention Strategy)
Tourism Targets Stretch Credulity
After beating its 2025 tourism target by bringing 4.6 million visitors in the door, the powers-that-be are now saying they intend to bring 22 million international arrivals by 2030—a nearly fivefold jump in five years—PLUS another 21 million domestic travelers, in an effort to generate $13 billion in revenue by decade’s end. Officials say they will deliver infrastructure, connectivity, and marketing to make it happen as they try to leverage the country’s natural beauty and proximity to Thailand, Vietnam, and Cambodia as a draw. The math is ambitious.
Read more: Travel And Tour World (Tourism Targets), Travel And Tour World (Growth Metrics)
Drug Busts Pile Up
One smuggling operation after another is falling to authorities this month. A Nigerian with 9.8 kilograms of heroin at Wattay International Airport, a German with 2.8 kilos headed for Malaysia, and Thai police grabbing a million meth pills just over the border. A bus driver in Savannakhet Province was caught with drug-infused collagen, kratom, and illegal e-cigarettes, while Thai authorities also got their hands on 55 ivory tusks weighing 169 kilograms near the border. The numbers are indicative of the volume of product moving through the country.
Read more: Laotian Times
QR Codes Replace Cash
QR code payments are spreading fast, with shops in Vientiane and other major cities increasingly adopting cashless systems. Banks are rolling out their own digital payment platforms, and international payment systems are making inroads into the market.
Read more: Lokmattimes (Digital Innovation Push), Asian Business Review (Banking Digitization)
Burn Ban Battles Annual Smog
Vientiane’s air quality index hit 127 and Luang Prabang rose to 152, prompting complaints and more attempts to control outdoor burning with better enforcement than in years past. The government’s new efforts address PM2.5 pollution during the January-April dry season when agricultural burning typically spikes, with a nationwide ban ostensibly covering all outdoor burning activities.
Read more: The Star (Enforcement Measures), Laotian Times (PM2.5 Controls)
Coffee Cracks $100 Million
More than 50,000 tons of coffee went out the door this year and brought in more than $100 million of export revenue, with local beans going to more than 20 countries including Thailand, France, and Japan. The crop covered roughly 97,400 hectares in 11 provinces. Champasak Province makes up more than half that area, with the Bolaven Plateau’s volcanic soil giving the coffee made their its edge.
Read more: The Star
Tether Targets 10,000 Crypto Converts
Stablecoins are expected to move roughly $1 billion through the Laos this year as Tether works on a countrywide financial literacy program through Bitqik, a local crypto exchange, with a goal of reaching 10,000 people by the end of next year. The plan includes seminars in Vientiane, Pakse, Vang Vieng, and Luang Prabang, and is conveniently timed along with the kip’s depreciation and the government’s crypto sandbox efforts.
Read more: Bitcoin World (Program Launch), ICO Bench (Participant Targets)
That’s all for this week, thanks for reading.
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