Lao People's Democratic Republic

Since economic reforms were instituted in the 1980s, LAO PDR has seen sustained economic growth. The GDP grew an average of 7.1 percent annually from 2001-2010 and is predicted to grow 7.6 percent annually from 2011-2015 (World Bank). In 2011, LAO PDR achieved a GNI per capita of US$1,010, enabling it to move from its status as a lower income economy to a lower-middle income economy. At its current rate of growth, the country is on track to achieve its goal of graduating from its status as a Least Developed Country by 2020.

Lao PDR’s poverty levels have decreased, with the proportion of poor people falling from 39 percent of the population in the mid-1990s to 27.6 percent in 2010 (IFAD). Nonetheless, the country remains one of the poorest in Southeast Asia. More than three quarters of the population live in rural areas and depend on agriculture for their survival; agriculture is largely practiced at subsistence levels. Poverty is particularly high in the upland areas of the country, with rates as high as 43 percent compared with 28 percent in the lowlands (UNICEF). Agricultural conditions tend to be challenging, resulting in low productivity. Poor conditions are exacerbated by a lack of access to improved technologies and inputs, as well as declining soil fertility (UNICEF).

LAO PDR continues to work to increase its regional and global integration. It is a partner of the The Greater Mekong Subregion (GMS) Economic Cooperation Program, as well as the Association of Southeast Asian Nations (ASEAN) and the ASEAN Free Trade Area (World Bank).

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