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Headlines:
Tehran Burns, Vientiane Lines Up for Diesel
Economy Limps Off the Stretcher
The Agreement That Built the Dams
New Bridge with Old Roads and a Newer Bridge
Planning All the Way Down
Doctor AI Will See You Now
Australia Keeps Plowing: AUD 15M for Lao Farms
Tehran Burns, Vientiane Lines Up for Diesel
Diesel prices went up LAK 7,380 per liter (~34 US cents) on March 6, one of the biggest single-day moves in years, after U.S.-Israeli strikes killed Iran's Supreme Leader and Tehran fired back throughout the Middle East. A normal monthly move is typically more like LAK 80-300, so this jump rivals only 2022 energy crisis peaks. Drivers were lining up at Vientiane stations before dawn, and the Ministry of Industry and Commerce demanded daily supply reports from importers as it warned against hoarding. The panic isn't irrational - Laos imported $1.26 billion in fuel last year (most of it via Thailand), leaving virtually no cushion when Thai refineries suffer their own price shocks as crude prices climb. Most of the crude comes by way of the Strait of Hormuz, the famous chokepoint that carries a fifth of global oil shipments and sits squarely in Iran's crosshairs.
Read more: Laotian Times
Economy Limps Off the Stretcher
The IMF sees an economy that’s moving in the right direction. Inflation that hit 30 percent in 2023 dropped to 7.7 percent in 2025, and public debt was reduced from 112% of GDP in 2022 to about 80% in 2025. Tighter monetary and fiscal policies in the second half of 2024 were able to steady the kip and cool price pressures. Growth is now expected to hold around four and a half percent through this year on electricity exports, tourism, and foreign investment. The IMF is hopeful that debt could fall to just over half of GDP by 2030 if fiscal discipline holds, but warned that current levels are still well above anything that might be considered sustainable. High external debt, thin foreign reserves, and a fragile financial sector mean the economy remains dangerously exposed. Primary budget surpluses of 2.5 to 3 percent of GDP would be more appropriate, so there’s still a long way to go.
Read more: Laotian Times
The Agreement That Built the Dams
The 1995 Mekong Agreement was introduced with high hopes equitable use of the River and forced everyone to promise “no significant harm” to the river system. Three decades later, the Mekong River Commission celebrated its anniversary in November 2025 with talk of shared prosperity, but a closer look may show a different story. Before 1995 the lower Mekong mainstream had zero large dams; China is now running 12 mainstream dams and controls the river flow at will. The basin is currently expecting a further 23 GW of planned hydropower that will need $50 billion in investment, and the consultation process which was meant to prevent harmful construction has largely just become background noise.
Read more: Mongabay
New Bridge with Old Roads and a Newer Bridge
The 5th Friendship Bridge with Thailand raked in 47.5 billion kip (about 69M THB/ $2.2 million) in its first full month after opening December 27, most of the money coming from customs duty on fuel, consumer goods, electrical appliances, and construction materials that crossed from Thailand's Bueng Kan province. The government has a 350 billion kip ($16.3 million) full-year revenue target for 2026; January's haul indicates that will be within reach. The bottleneck isn't the bridge itself but National Road No. 8 on the eastern approach toward Vietnam. Its crumbling surface can't handle the 11-tonne-per-axle international standard, forcing some freight operators to transfer cargo between vehicles mid-route or skip the crossing entirely. Transit traffic to third countries has remained flat, even though domestic trade is climbing. Vientiane and Bangkok have also put a price tag on their sixth Friendship Bridge: $165 million to connect Salavanh Province to Thailand’s Ubon Ratchathani. The 1.6-kilometer crossing will also require 23.4 kilometers of connector roads. Thailand is expected to pick up a little more than half of the bill. Budget approvals are expected in 2028, construction in 2029, and a bridge opening in 2031, so we are still five years away from any traffic.
Read more: The Star (bridge 5), Laotian Times (bridge 6)
Planning All the Way Down
Three plans, three time horizons, and one cabinet meeting. On February 24 the Lao cabinet blessed a five-year plan through 2030, a ten-year strategy through 2035, and a long-term vision that stretches all the way to 2055. The shortest horizon alone promises 50,000 vocational graduates, 650,000 workers trained, and 411,000 people pushed into jobs at home or abroad. Prime Minister Sonexay Siphandone says that the vision-making exercise will help the nation build an "independent and self-reliant economy" in a region that has no shortage of trade disputes.
Read more: The Star (planning), USASEAN BC (strategy)
Doctor AI Will See You Now
An MOU signed with three Chinese companies in February will support the study and build out of a National Health AI Platform under the umbrella of China’s Belt and Road project. The platform will be specifically designed to support disease analysis and the digitization of medical records. The ambition comes with some baggage because Laos is rated 125th out of 195 in the Oxford Insights Government AI Readiness Index 2025. It scored abysmally at only 30 out of 100, with dogged gaps identified in tech access, skills, and research capacity.
Read more: USASEAN BC
Australia Keeps Plowing: AUD 15M for Lao Farms
Thirty-five years and more than 150 projects later, Australia's agricultural research partnership is going for another round. AUD 15 million (~$10.6 million) is being promised through ACIAR, and will be spread over six projects and five years to cover everything from climate-smart cropping and poultry genetics to digital market access for cattle trades. More than 50 researchers have been awarded Master's and PhD degrees through the program so far. The money total is modest through the lens of a farm sector that (according to the article) employs more than three-fifths of the workforce and is still very exposed to the sort of climate shocks that the new projects are intended to address.
Read more: Laotian Times
That's all for this week, thanks for reading. Your voice matters to us. Feel we're missing something? Have additional sources to suggest? Don't hold back- hit reply and tell us what you think.
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