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Asean & Global Updates
POSTED | 15:13 PM | 08-01-2018

Lao push for shift to industry

The Lao government is trying to increase the size of the workforce in the industry, construction and service sectors in order to move the economy closer to industrialization and the use of new technology, The Vientiane Times reported on Monday (Jan 8, 2018).

There are also plans to reduce the number of people working in agriculture, even though this sector is in need of development, a Lao economist said.

This year, the government plans to increase the number of workers in the industry and construction sectors from 11.8 percent to 12 percent, and to 23.7 percent in the service sector.

These are the moves the government should make in order to rise above Least Developed Country status and shift towards industrialization, a senior economist at the National Economic Research Institute, Dr Leeber Leebouapao, told The Vientiane Times.

But there will be many challenges in achieving these targets, he warned.

Most of the population are farmers and use their own land to grow crops, with the demand for labour in this sector being especially high, such as on rubber plantations.

It is necessary to bring in workers from neighbouring countries due to the shortage of Lao workers, Dr Leeber said.

Laos’ economy should incorporate more technology in order to better integrate with more developed countries, he added.

He believed that development needs would result in a larger number of workers in the industry and service sectors, but even so this number would be quite small.

The increase in Specific and Special Economic Zones is a driving force in increasing the number of people working in industry.

Dr Leeber explained that in industrial countries the number of workers in agriculture was quite small as most of the land was owned by the government, who used it for other purposes.

To ensure economic growth of 7 percent this year, the government plans that agriculture should grow by 2.8 percent to account for 15.73 percent of GDP.

Industry is forecast to grow by 9.1 percent accounting for 30.79 percent, and the service sector is set to grow by 6.4 percent, accounting for 41.83 percent of GDP.

Revenue from import tariffs is scheduled to increase by 9 percent and account for 11.65 percent of GDP.

The main sectors expected to drive economic growth are industry and services with construction expected to be the primary driver in the industry sector, which is set to grow by about 20 percent.

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