Laos is one of the poorest countries in Asia.
Poor communications and lack of both capital and
educated manpower have left the country's natural wealth
largely unused, something that is now changing. A large
majority of the population is employed in agriculture.
Industry and the service sector have grown rapidly
since the transition from socialist planning economics
to market economics began in the mid-1980s. Clothing and
textile exports and the mining industry have expanded,
and tourism, together with electricity production, is
one of the country's most important sources of foreign
Major imports by Laos, covering a full list of top products imported by the country and trade value for each product category.
Laos is dependent on foreign aid and loans. The aid
covers both the constant deficits in foreign trade and
the large holes in the state budget. Important donors
are the IMF, the Asian Development Bank (ADB) and the
World Bank, as well as individual countries such as
Japan and Australia.
In 2002, Lao's total foreign debt was approximately $
2.7 billion. One year later, Russia wrote off 70 percent
of the country's debt from the time before the Soviet
Union collapse in 1991. The remaining part will be paid
off over a 30-year period.
Economic reform policy produced good growth during
much of the 1990s. However, during the so-called Asian
crisis of 1997–1998 (see Modern history), growth
slowed; the crisis hit hard on Thailand, and Lao exports
to neighboring countries shrunk while Thai investment in
Laos declined. In 1998, GDP growth was negative while
Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including LAO which represents the country of Laos. Check findjobdescriptions to learn more about Laos.
Since the turn of the millennium, growth has regained
momentum and inflation has slowed. The global financial
crisis of 2008-2009 caused the growth to slow down
temporarily as a result of lower exports, but after that
the average growth has again been steady.
The causes of the economic upswing after the turn of
the millennium are sharply increased foreign investment,
especially in the mining industry, and the resumption of
trade with the United States in 2004 after being
discontinued in the early 1960s.
The economic success has mainly benefited the
metropolitan area and the cities along the Mekong River.
Rural development is still severely neglected, even
though the government has made significant efforts to
combat poverty through loans and assistance.
Obstacles on the road away from poverty are Lao's
extensive bureaucracy, which, among other things, leads
to difficulties and hassles for small farmers and small
business owners to obtain bank loans, and - not least -
the widespread corruption at all levels of society. Many
holders of power see a lure in enriching themselves with
the ever faster recovery of the country's natural
A small Laotian stock exchange was opened in 2011.
The purpose was that this, together with Lao's entry
into the WTO in 2013, would attract more foreign direct
investment into the country.
Laos imports goods at a significantly higher value
than the country's exports amount to. All capital goods,
oil products and industrial inputs are purchased from
abroad. Exports mainly comprise electricity, minerals,
wood products, clothing and textiles, and coffee. The
constant deficit in foreign trade is offset by aid,
loans and money that Laotians abroad send home.
Main trading partners are Thailand, China and
Vietnam. Laos exports to EU countries on favorable
terms, and much of its clothing production comes to
Europe. Alongside official foreign trade, extensive
smuggling operations are ongoing.
FACTS - FINANCE
GDP per person
US $ 2,568 (2018)
US $ 18 131 million (2018)
6.5 percent (2018)
Agriculture's share of GDP
15.7 percent (2018)
Manufacturing industry's share of GDP
7.4 percent (2018)
The service sector's share of GDP
41.6 percent (2018)
3.1 percent (2019)
Government debt's share of GDP
57.2 percent (2018)
US $ 14 498 M (2017)
US $ 5 295 million (2018)
US $ 6,164 million (2018)
- US $ 1,430 million (2018)
Commodity trade's share of GDP
64 percent (2018)
Main export goods
electricity, minerals, wood products, clothing and
textiles, coffee (2017)
Largest trading partner
Thailand, China, Vietnam (2017)
Hmong members surrender
More than 400 members of the hmong people's group submit to the authorities.
They belong to the many hmong people who have lived as refugees in the jungle
since 1975, when the US-friendly government that supported hmong was defeated by
Choummaly Sayasone becomes new president
Vice President Choummaly Sayasone succeeds Khamtay Siphandone as president
after being appointed leader of the ruling Communist Party in March 2006.