Laos keen to find solutions to problems of business sector

VIENTIANE (Vientiane Times/ANN) - Helping entrepreneurs to address their problems is one of the government’s top priorities in its bid to boost economic growth and generate job opportunities for local people.

Addressing the ongoing National Assembly session recently, Prime Minister Thongloun Sisoulith highlighted the need to remove red tape for the private sector.

The premier said the government is committed to thoroughly learning about the business environment in Laos while helping investors to solve their problems and remove barriers.

Since private investment accounts for more than 50 percent of the value of the economy, the government is keen to address investors’ problems and create an environment that encourages people to operate businesses.

The trade and investment sectors are still growing at a higher rate despite complicated administrative procedures that slow the progress of investors and exporters.

Addressing all these challenges would help lower production costs which should in turn lower the cost of manufacturing and business operations. 

From the beginning of January until June 2, the government approved trade and investment licences for 4,118 business units with registered capital of US$3.72 billion.

Of the total approved projects, 23 are mega projects for which memorandums of understanding have been signed between the government and developers.

In addition, the government is keen to help lower production costs for investors by stabilising electricity and water supplies. Lowering the cost of doing business in Laos will help to lower the price of products and services, which should make Lao products more competitive in the regional market. 

Some of the main challenges for exporters in the landlocked country are the high cost of transport and the time-consuming document approval for investment projects.

Mr Thongloun stressed the importance of dealing with these challenges to attract more investment from the private sector, in order to spur economic growth.

The government has projected that the economy might only grow at the rate of 6.7 percent as a result of revenue shortfall and financial difficulties faced by the business sector.

Another challenge is that many entrepreneurs still lack access to funding. The criteria required to be granted approval for investment and business operations continue to create obstacles for people trying to run a business.

Economists say the economy is projected to revitalise in the next few years but the government needs to further improve the business and investment climate to facilitate the business sector.

One of the topics discussed at the government’s first open session, held in Huaphan province in March, was how to further improve the business environment and boost growth.

Minister to the Prime Minister’s Office and Government Spokesman, Dr Chaleun Yiapaoher, said recently that efforts to assist the business sector had seen some progress.

Nevertheless, several sectors have been slow to incorporate the relevant laws, prime ministerial orders and decrees into their action plans.   

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