 RESTRICTED  
  
WT/TPR/G/394  
14 October  2019 
(19-6591) Page: 1/27 
Trade Policy Review Body   Original: English  
 
TRADE POLICY REVIEW  
REPORT BY  
LAO PEOPLE'S DEMOCRATIC REPUBLIC  
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex 3 of the 
Marrakesh Agreement Establishing the World Trade Organization), the policy statement by 
Lao People's Democratic Republic  is attached.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on Lao People's Democratic Republic . WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  Contents  
 
PART I – STATE OF PLAY IN TH E REFORM PROCESS  ................................ ........................  4 
1   INTRODUCTION  ................................ ................................ ................................ .........  4 
2   INTEGRATION INTO  THE WORLD ECONOMY  ................................ ...............................  4 
2.1   Brief history of the World Trade Organization accession  ................................ ...................  4 
2.2   ASEAN Integration  ................................ ................................ ................................ ...... 5 
2.3   Other Regional Trade Agreements (RTAs), Bilateral Investment Treaties (B ITs) and 
Double  Taxation Treaties (DTTs)  ................................ ................................ ..........................  5 
3   RECENT MACROECON OMIC, STRUCTURAL AND  OTHER DEVELOPMENTS  .....................  6 
4   TRADE AND INVEST MENT REGIME  ................................ ................................ .............  6 
4.1   Lawmaking  ................................ ................................ ................................ ................  6 
4.2   Constitution al Amendments of 2015  ................................ ................................ .............  7 
4.3   Trade Policy formulation and mainstreaming of trade  ................................ ......................  7 
4.4   Engaging with the private sector  ................................ ................................ ..................  7 
4.5   Enhancing Transparency  ................................ ................................ ..............................  7 
4.6   Complying with the WTO notification requirements  ................................ .........................  8 
4.7   Improvement of overall Investment climate  ................................ ................................ ... 8 
4.8   Resolution of economic disputes  ................................ ................................ ...................  8 
5   SELECTED TRADE P OLICIES AND PRACTICE S BY MEASURE  ................................ ........  9 
5.1   Implementation of the Trade Facilitation Agreement  ................................ .......................  9 
5.2   Streamlining of Customs procedures  ................................ ................................ .............  9 
5.3   Tariffs  ................................ ................................ ................................ .......................  9 
5.4   Import Licensing  ................................ ................................ ................................ ...... 10 
5.5   Trade Remedies  ................................ ................................ ................................ ....... 10 
5.6   Export Policies  ................................ ................................ ................................ ..........  10 
5.7   Special and Specific Economic Zones  ................................ ................................ ..........  10 
5.8   State Owned and State Trading Enterprises  ................................ ................................ . 11 
5.9   Reinforcing Protection of Intellectual Property Rights  ................................ ....................  11 
6   TRADE POLICY BY SECTOR  ................................ ................................ .......................  11 
6.1   Goods  ................................ ................................ ................................ .....................  11 
6.1.1    Agriculture  ................................ ................................ ................................ ............  11 
6.1.2    Forestry  ................................ ................................ ................................ ................  12 
6.1.3    Mining  ................................ ................................ ................................ ..................  13 
6.1.4    Electricity  ................................ ................................ ................................ .............  13 
6.1.5    Manufacturing  ................................ ................................ ................................ ....... 13 
6.2   Servic es ................................ ................................ ................................ ..................  14 
6.2.1    Financial Sector/ the B ank of Lao PDR (B OL) ................................ .............................  14 
6.2.2    Telecommunications  ................................ ................................ ...............................  15 
6.2.3    E-commerce  ................................ ................................ ................................ ..........  15 
6.2.4    Transp ort ................................ ................................ ................................ ..............  15 WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  6.2.5    Tourism  ................................ ................................ ................................ ................  16 
PART II – MAJOR THRUSTS OF LA O PDR'S TRADE POLICY  REFORMS IN THE 
UPCOMING  YEARS  ................................ ................................ ................................ .........  16 
1   INTRODUCTION  ................................ ................................ ................................ ....... 16 
2   IMPLEMENTATI ON OF THE LAWS AND D EVELOPMENT PROGRAM MES ......................  17 
2.1   Measures to ensure that implementation instruments are established within a 
reason able time frame after the promulgation of the laws  ................................ .....................  17 
2.2   Measures to ensure that that the implementation instruments are fully consistent with 
the spirit of laws promulgated  ................................ ................................ ...........................  17 
2.3   Training measures proposed for Ministries and Agencies in charge of im plementation to 
ensure efficient and coherent implementation.  ................................ ................................ ..... 17 
2.4   Measures with respect to review and streamlining of the proced ures ...............................  17 
3   INCREASING EFFIC IENCY AND EFFECTIVEN ESS OF THE DEVELOPME NT AND 
REFORM  POLICIES  ................................ ................................ ................................ ........  19 
4   TAKING ADVANTAGE  OF PARTICIPATION IN  REGIONAL AND MULTIL ATERAL 
TRADE  POLICY NEGOTIATIONS  ................................ ................................ .....................  19 
PART III – LAO PDR'S GRADUATIO N PREPARATION POLICY  ................................ ........  20 
1   INTRODUCTION  ................................ ................................ ................................ ....... 20 
2   SHORT -TERM M EASURES TO ENSURE A SMOOTH TRANSITION FR OM THE LDC 
STATUS  ................................ ................................ ................................ .........................  21 
2.1   Loss of trade preferences  ................................ ................................ ..........................  21 
2.1.1    Trade in goods.  ................................ ................................ ................................ ..... 21 
2.1.2    Trade in services  ................................ ................................ ................................ ... 22 
2.2   Loss of certain flexibilities granted to LDC WTO members in terms of commitmen ts ..........  22 
2.3   Potential loss of the ODA and tightening of its conditions  ................................ ...............  23 
3   LONGER TERM MEAS URES TO ENSURE LAO P DR'S SUSTAINED DEVEL OPMENT .........  24 
3.1   Reducing Economic Vulnerability Index  ................................ ................................ ....... 24 
3.2   Structural change of the economy  ................................ ................................ ..............  25 
3.2.1    Measures to Improve Ease of Doing Business  ................................ ............................  25 
3.2.2    The human capital index  ................................ ................................ .........................  26 
4   THE INSTITUTIONA L FRAMEWORK FOR THE GRADUATION STRATEGY  .....................  27 
4.1   Introduction  ................................ ................................ ................................ .............  27 
4.2   The way forward  ................................ ................................ ................................ ...... 27 
4.2.1    Mobilization of resources ................................ ................................ .........................  27 
4.2.2    The elaboration of the graduation strategy  ................................ ................................  27 
4.2.3    Institutional and consultation mechanisms  ................................ ................................  27 
 
 
  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  PART I – STATE OF PLAY IN THE  REFORM PROCESS  
1  INTRODUCTION  
1.1.  In accordance with the objectives and the procedures of trade policy review mechanism, 
Lao PDR would like to draw attention of the WTO Members to several important topics that are 
contributors to its economic growth, thus covering major aspects related to economic, trade, 
business and investment climate of the country.  
1.2.  During the period under r eview, Lao PDR 's domestic and foreign trade policies focused on 
four key priorities: (a) ensuring compliance of domestic laws with best international standards and 
best practices; (b) diversifying away from over -reliance on natural resources and increasing labo ur 
productivity; (c) developing and reinforcing the human capital and (d) improvement of business 
environment and investment climate. In its progress, Lao PDR was largely guided by the Millennium 
Development Goals (MDGs) and, later, by the S ustainable Development Goals (SDGs) 2030.  
1.3.  Among the main driving forces for the legal, institutional and economic reforms undertaken so 
far, are aligning of the national legislation with the legal frameworks of the WTO and the ASEAN, as 
well as the best in ternational practices reflected therein. The reforms have touched almost all 
trade -related legislations, with notable progress in customs, most aspects of trade policy in goods 
and services, public procurement, agriculture, taxation, technical regulations,  energy, transport, etc.  
2  INTEGRATION INTO THE  WORLD ECONOMY  
2.1  Brief history of the World Trade Organization accession  
2.1.  The Government of the Lao PDR applied for accession to the World Trade Organization (WTO) 
in July 1997 and joined the Organization on 2 Feb ruary 2013 as 158th Member, the 6th Least 
Developed Country (LDC), and the 30th economy that joined the WTO pursuant to Article XII of the 
WTO (Marrakesh) Agreement. Lao PDR had 66 Working Party Members involved in examining its 
trade policy regime and in negotiating its terms of accession. It had bilateral market access 
negotiations with 9 WTO Members. The Working Party report of Lao PDR consists of 247 paragraphs 
of which 26 are commitment texts; 6 commitments, notably those related to trading rights; SPS ; 
TBT; Trade remedies; TRIPS; transparency; and notifications, benefitted from transition periods. 
Lao PDR enacted and revised more than 90 laws and regulations to ensure that its legal regime is in 
line with WTO obligations. This legislation covered wide range of areas, including import and export 
licensing, customs valuation, services, investment, SPS and TBT measures, as well as intellectual 
property rights. Upon accession, the commitments in trade in goods covered 10,694 tariff lines,  with 
an average bo und rate of 19.3% for agricultural goods and 18.7% for industrial goods, compared 
with applied tariffs of 18.4% and 10.0%, respectively. Most tariff commitments took effect from the 
date of accession while some were to be reduced transitionally over 5 to 1 0 years. In services, 
Lao PDR has opened 10 sectors/79 subsectors. These included: professional services, computer 
services, research and development, telecommunication, construction, distribution services, private 
education, environmental services, financ ial services, private health, tourism, and air transport. The 
accession to the WTO contributed to the adjustment of the trade -related legal framework of Lao PDR 
to international standards. It has also commenced the process of implementation of these 
progre ssive rules, which is still ongoing and necessitates further planning, monitoring and technical 
assistance.  
2.2.  Lao PDR, least developed country (LDC) and landlocked developing country (LLDC) landlocked 
LDC, is a strong supporter of the rules -based multilatera l trading system embodied in the WTO. 
Lao PDR is of the view that the WTO, offers the best prospects to fully address trade issues 
accounting for the capacity constraints brought about by differences in the levels of economic 
development among its Members.  Thus, Lao PDR is committed to the completion of the Doha 
Development Agenda (DDA) mandate with the economic development of the WTO Members being 
central. Meanwhile, in recognizing the need to keep pace with the developments in the global 
economy, Lao PDR has also co -sponsored the member -driven initiatives on the "new" issues: 
e-commerce, Micro, Small and Medium enterprises (MSMEs) and investment facilitation at the WTO.  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  2.2  ASEAN Integration  
2.3.  Lao PDR 's membership in the Association of Southeast Asian Nations (ASEAN) is one of its 
strategic priorities. Lao PDR joined ASEAN in 1997. Since the establishment of the ASEAN Economic 
Community ( AEC) on 31 December 2015, Lao PDR  has actively worked with other ASEAN Member 
States (AMS) to implement obligations under the  AEC towards the realization of a single market 
encompassing a free flow of goods, services, and investment in the region. The current efforts in 
this direction are guided by the AEC Blueprint 2025, which incorporates and carries forward the work 
of the AE C Blueprint 2015. The AEC Blueprint 2025, relying on the 23 Sectoral Action Plans (SEPs) 
combined into the AEC Consolidated Strategic Action Plan 2025 (CSAP), aims to strengthen and 
reinforce the  AEC five characteristics : (a) A Highly Integrated and Cohesive Economy; (b) A 
Competitive, Innovative, and Dynamic ASEAN; (c) Enhanced Connectivity and Sectoral Cooperation; 
(d) A Resilient, Inclusive and People -Oriented, People -Centered ASEAN; and (e) A Global ASEAN. It 
also incorporates new focus areas, suc h as global value chains , good regulatory practices, 
sustainable development, global megatrends and emerging trade -related issues (promoting 
innovation and e -commerce, improving trade facilitation, deepening services and investment 
integration, cultivating  conductive regulatory environment and progressing ASEAN external 
relations). One of the specific objectives set forth in the AEC Blueprint 2025 is to narrow the 
development gap by providing support to Cambodia, Lao PDR, Myanmar and Viet Nam (CLMV) to 
augm ent their capacity to implement regional agreements. The implementation of the AEC Blueprint 
2025 is supported by the operationalization of the AEC 2025 Monitoring and Evaluation (M&E) 
Framework through, among others, the development of monitoring tools an d databases to support 
compliance and outcomes monitoring, evaluation, verification, review, and reporting.  
2.4.  ASEAN has, in the period of review, made progress in deepening internal integration and 
strengthening external relations. Among ASEAN's achievement s were: (i) ASEAN's elimination of 
tariffs on 98.6% of tariff lines traded among AMS, via the ASEAN Agreement on Trade in Goods 
(ATIGA); (ii) ASEAN's completion of the 10th package of commitments to remove restrictions to 
services trade in AMS, under the A SEAN Framework Agreement on Services (AFAS) and entering 
into next stage of integration on services  with a negative listing approach  through the recently 
concluded ASEAN Trade in Services Agreement (ATISA)  to supersede AFAS ; (iv) Signing of the 
ASEAN Agree ment on Electronic Commerce; (iv)  entry into force of the ASEAN -Hong Kong, China 
Free Trade Agreement (AHKFTA) and ASEAN -Hong Kong China Investment Agreement (AHKIA); 
(v) improvements to ASEAN's FTAs with China, Japan, Korea, and Australia -New Zealand; (vi ) 
ongoing negotiations of the Regional Comprehensive Economic Partnership (RCEP) Agreement, a 
16-Party RTA comprising all AMS and ASEAN's six FTA partners (Australia, China, India, Japan, 
Korea, and New Zealand); (vii) setting out parameters of the future ASEAN -EU FTA; (vii) feasibility 
study of an ASEAN – Canada FTA; and (viii) signing of the Memorandum on closer cooperation 
among members between the ASEAN and the Eurasian Economic Commission.  
2.5.  The Lao PDR Government began implementing the ATIGA in 2010. As  one of the least 
developed nations and a newer ASEAN member, Lao PDR was able to prolong the implementation 
of the full obligations of the agreement until 2018. In 2018, Lao PDR has reduced import tariffs on 
9,206 items or 96.3% of total tariff lines to z ero percent as part of its efforts in establishing the 
ASEAN Free Trade Area.   
2.3  Other Regional Trade Agreements (RTAs), Bilateral Investment Treaties (BITs) and 
Double Taxation Treaties (DTTs)  
2.6.  In addition to the ASEAN and the Regional Trade Agreements (RTAs ,) in which Lao PDR 
participates as an ASEAN Member  State , Lao PDR is a member of Asia -Pacific Trade Agreement 
(APTA) and actively participates in trade liberalization under this agreement. Lao PDR is a signatory 
to total of 27 bilateral agreements for mut ual protection and promotion of foreign investment, of 
which 26 are currently in force. Two agreements – the Bilateral Investment Treaty (BIT) with Belarus 
(2013, not in force) and Trade and Investment Framework Agreement ( TIFA) with the US (2016) 
were sig ned during the review period. A prolongation is negotiated for Lao PDR – India BIT. The 
1997 Cooperation agreement with EU also covers certain aspects related to trade and investments. 
Related to taxation, Lao PDR has concluded 15 treaties for avoiding dou ble taxation with its main 
economic partners worldwide. 13 of these treaties are currently in force, while a Double Taxation 
Treaty (DTT) with India is negotiated. Lao PDR is a party to the Convention Establishing the 
Multilateral Investment Guarantee Agen cy (MIGA) and the New York Convention on the Recognition 
and enforcement of Foreign Arbitral Awards . In addition, on 1 March 2019, Lao PDR ratified a decision WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  by the Standing Committee of the National Assembly to join the Vienna Convention on Contracts for  
International Sales of Goods (CISG). After depositing its accession document, Lao PDR will become 
the 90th country, and the 3rd in ASEAN, to join this convention in 2020. Even though Lao PDR is not 
a party to International Centre for Settlement of Investment Disputes (ICSID) Convention, several 
of its BITs contain reference thereto. Also, 3 claims involving Lao PDR were considered  under the 
ICSID Additional Facility arbitration rules. In August 2019, Lao PDR signed the Singapore Convention 
on Mediation.  
3  RECENT MACROECONOMIC , STRUCTURAL AND OTH ER DEVELOPMENTS  
3.1.  Since its WTO accession in 2013, real GDP growth in Lao PDR has averaged close to 7.3% a 
year. Growth slowed to around 6.3% in 2018. Construction has been an important element in 
growth, including significant infra -structural investments. Services, with some 47%, is the largest 
sector of the economy, followed by agriculture, wi th a relatively steady share of almost 20%, 
manufacturing, hovering between 8 and 9%, and mining with a share of around 7%. In consequence 
of this steady growth, GDP per capita has risen to almost US D 2,600 and poverty has declined to 
below 20%.  
3.2.  Throughout  the period since 2013, inflation has remained low, averaging under 3% a year and 
significantly below that in the recent past. Largely due to public investments, the fiscal deficit has 
been fairly high, although some consolidation brought it down to around  4.4% of GDP in 2018, 
compared to 5.5% a year earlier: public and publicly guaranteed debt has risen to 57.3% of GDP. 
The debt is largely externally held, suggesting the possibility of an exchange rate risk for the fiscal 
accounts. This said, Lao PDR recog nizes the need for continued, gradual fiscal consolidation, 
including by broadening the tax base and strengthening fiscal governance.  
3.3.  On the external front, since 2013 Lao PDR 's current account has been in rather significant 
deficit but has narrowed in te rms of GDP, from a peak of 14.5% in 2014 to around 8% in 2018. 
Contributing to this narrowing has been a sustained growth in exports, including electricity, minerals 
(with higher metal prices) and electronic components while import growth has moderated, pa rtly 
due to the domestic production of some consumer goods and cement. ASEAN is by far Lao PDR 's 
main export market, with a share of almost 64% in recent years  – with a Thai share 48% – followed 
by the People 's Republic of China (PRC), with some 26%. These  are also Lao PDR 's main sources of 
imports, with Thailand alone accounting for over 60% – out of a total ASEAN share of 75 .5% – and 
then PRC with 17%. During this same period from 2013 FDI flows have increased to almost 5% of 
GDP in 2017, partly in the po wer sector and infrastructure, with China and Thailand as the main 
sources, and reflecting an investor friendly regime, improved by the Investment Promotion Law of 
2016.  
3.4.  These macroeconomic developments are in the context of a still structurally challenged  
Lao PDR economy. Well over 70% of the non -agricultural workforce is informally employed and 
productivity is a serious issue; poverty has certainly declined but remains close to 20%. The 
concentration of both export products and markets as well as the sour ces of imports and FDI point 
to the vulnerability of Lao PDR to external shocks, which is exacerbated by the fact that foreign 
exchange reserves are in the order of 1.5 months of imports of goods and services. This emphasizes 
the continued need for trade a nd domestic reforms in Lao PDR. And indeed, this is recognized and 
addressed in the 8th Five Year National Socio -Economic Development Plan (NSEDP). The 8th NSEDP 
targets annual average real GDP growth of 7.5%. To achieve this, it seeks to promote economic 
diversification, enhanced public infrastructure and an improved private investment climate, focusing, 
inter alia , on non -resource -based SMEs, deeper integration into ASEAN and trade and investment 
facilitation and promotion measures. These are addressed in  the balance of this Report.  
4  TRADE AND INVESTMENT  REGIME  
4.1  Lawmaking  
4.1.  In 2012, Lao PDR has undertaken a major step seeking improvement in transparency, 
consistency and coherence of its normative framework through adoption of the Law on Lawmaking. 
The law appl ies both to laws and the other – inferior – legislative act of general application, issued 
by the legislative and executive branches of the Government. The new draft legislation as well as 
amendments to the existing legal acts are subject to impact assessm ents, addressing both – WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  regulatory and budgetary implications. According to the said Law, if the provisions of existing 
legislation and newly adopted legislation of general application are inconsistent with the provisions 
of international treaties that Lao  PDR is party to, the provisions of the international treaty prevails 
and the provisions of existing legislation or newly adopted legislation shall be revised in due time.  
4.2  Constitutional Amendments of 2015  
4.2.  The amendment of the Constitution in 2015 strengthened the framework of policies and 
coordination in the Government towards the enforcement of the rule of law. 64 provisions were 
amended and another 24 introduced, in particular, (i) reinforcing democratic governance through 
establishment of electe d People 's Councils and clarification of status and functions of the state organs 
belonging to each of the state powers – legislative, executive and judicial; (ii) improving 
accountability with respect to budgetary outlays – by setting the State Audit Orga nization; and 
(iii) putting a stronger emphasis on democratic rights and entitlements, including education, public 
health services and public participation. The new Constitution has clearly articulated the interest of 
the Lao PDR in promoting foreign inves tment and highlighted that the lawful assets and capital of 
investors shall not be confiscated, seized by the State or nationalized.  
4.3  Trade Policy formulation and mainstreaming of trade  
4.3.  The Ministry of Industry and Commerce of Lao PDR carries out the task s of formulation, 
implementation and intra - and inter -ministerial coordination of trade policies, represents Lao PDR in 
business fora and serves as a focal point for the WTO -, RTA - and EIF (Enhanced In tegrated 
Framework) -related developments. While trade i s mainstreamed into national development plans 
(notably, the 7th (2011 -2015) and the 8th (2016 -2020) NSEDP, wide range of issue -specific 
strategies and plans are also in place. The latter occasionally overlap with respects to the targets 
set and implementa tion strategies adopted (including the allocated budgetary outlays). While ad hoc 
inter-ministerial coordination mechanisms are being often established to address particular issues, 
ensuring coordination remains difficult and requires improvement, which, in its turn, necessitates 
further technical assistance and capacity building.  
4.4  Enga ging with the private sector  
4.4.  The Government holds regular consultations on trade -related issues with private sector. The 
latter is represented by the Lao National Chamber of Commerce and Industry (LNCCI), an umbrella 
organization for local and foreign busi nesses. Since 2010, LNCCI also serves as the secretariat of 
the Lao Business Forum (LBF), launched in 2005. The LBF, organized on 4 different levels, holds an 
annual event (the most recent, 12th, LBF will take place in October 2019). Annual meetings are 
complemented by the biannual meetings of the Steering Committee (SC) and the Public -Private 
Consultations (PPF). LBF also operates through 16 Private Sector Working Groups (PSWG). Meetings 
of the groups are open to private sector members of the PSWG as well as any other companies that 
are interested in attending.  Among those: 12 sectoral working groups: I nformation and 
Communications Technology (ICT), Manufacturing, Trade, Services, Agro -processing; Handicrafts; 
Transportation & Logistics; Construction; Minin g; Tourism; Banking & Insurance; Hydropower and 
4 other working groups: Cross -Cutting Issues, State -owned Enterprises (SOEs), SMEs, 
Businesswomen.  
4.5  Enhancing Transparency  
4.5.  During the review period , Lao PDR has undertak en substantial efforts aimed at improvin g 
transparency of its trade regime. In 2013, electronic version of the Official Gazette (which was 
available only in hard copies before) was launched. The Gazette is the official source for all 
legally -enforceable primary and subsidiary legislation of gene ral application for Lao PDR at the 
national, provincial and capital levels.  Drafting authorities may post a draft legislation for at least 
60-day public comment periods on this website, however, they also have the option to post such 
drafts on another webs ite (typically their own agency website), in printed media or via other means 
to ensure that the public can have easy access to them. Selected normative acts and draft laws are 
available in English. Domestic and foreign individuals, legal entities and orga nizations in both the 
public and private sectors are eligible to provide comments on draft legislation by sending their 
comments to the authority in charge of making legislation according to the defined time and 
procedures . Workshops devoted to particular legal drafts are also routinely organized.  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  4.6.  In addition, Lao PDR has established a Trade Information Portal in goods 
(https://www.laotradeportal.gov.la ). It has recently added to this a portal information on trade in 
services ( http://www.laoservicesportal.gov.la ). Both portals maintain a solid user base and make 
ongoing effort to keep the content updated. Despite their existence in two language  versions – Lao 
and English, the information is predominantly available in Lao, subject to subsequent and selective 
translation. Technical assistance and capacity building are required to streamline the translation 
process.  
4.6  Complying with the WTO notifica tion requirements  
4.7.  Since accession, Lao PDR has made significant efforts to notify the WTO Members about 
developments in its trade policies as envisaged by the WTO Agreements. Namely, notifications 
required by the following WTO Agreements: General Agreement  on Tariffs and Trade (GATT); 
General Agreement on Trade in Services (GATS); Agreement on Agriculture; Agreement on the 
Implementation of Article VI of the GATT 1994 (Anti -dumping); Agreement on Import Licensing; 
Agreement on Rules of Origin; Agreement on Subsidies and Countervailing Measures; Agreement on 
Sanitary and Phytosanitary Measures; Agreement on Technical Barriers to Trade; Agreement on 
Trade Facilitation; Agreement on Trade -Related Investment Measures; Agreement on Preshipment 
Inspection; Agreeme nt on Safeguards;  GATS and TRIPS were submitted to the WTO Secretariat. 
Lao PDR faces serious difficulties when preparing notifications, mainly due to lack of human 
resources and technical capacity. This resulted in occasional delays. To address the issue,  the 
Government has prepared a list of the WTO notifications to be completed. In addition, 
inter-ministerial coordination mechanisms aimed at ensuring timely compliance with the notification 
requirements are being developed. Nevertheless, technical assista nce and capacity building are 
indispensable to ensure steady progress in the area.  
4.7  Improvement of overall Investment climate  
4.8.  In the course of the review period, Lao PDR has taken steps towards improvement of its 
investment climate. The relevant legal frame work was streamlined through amendment of the Law 
on Investment Promotion, which has reflected numbers of the Organization for Economic 
Cooperation and Development ( OECD) recommendations and is aligned with the ASEAN 
Comprehensive Investment Agreement (ACI A). An Investment Promotion and Supervision 
Committee was established in 2018 to ensure the inter -ministerial coordination in the area. In 2019, 
a Decree on Approval the List of Controlled and Concession Businesses of Lao PDR refined controlled 
and concess ional businesses lists and the process of investment project approvals therein. For all 
types of investments, such process proceeds through one -stop service, albeit, with different 
timeframes, ranging from 10 to 65 working days. The registration tasks are shared between the 
Ministry of Planning and Investment (for the controlled and concessional activities) and the Ministry 
of Industry and Commerce (for the other activities). Further, a Prime Minister 's Order No.  02/PM on 
Improving Regulations and Coordinat ion Mechanism on Doing Business in Lao PDR was issued in 
February 2018 to streamline the registration procedures. The process of enterprise registration has 
also recently been simplified. In result of the above measures, the reported cumulated investment 
demonstrates a significant increase.  
4.8  Resolution of economic disputes  
4.9.  Lao PDR undertakes steps aimed at improvement of resolution of economic disputes, as a part 
of its strategy to ameliorate its investment climate and facilitate doing business. Namely, spe cific 
trainings are organized for the judges involved in resolution of economic and intellectual property 
disputes, often relying on support from the international partners. Also, the Law on Resolution of 
Economic Disputes, as amended in 2018 has reinforce d mediation and arbitration as alternative 
dispute resolution mechanisms available to businesses, in particular, via establishment of the Centre 
of Economic Dispute Resolution (CEDR), at central level, and Offices of Economic Dispute Resolution 
(OEDR), at provincial levels. Nevertheless, further developments appear to be necessary. Among 
those – creation of separate specialized commercial courts and further reinforcement of international 
arbitration procedures by bringing the relevant legal framework in com pliance with the 1985 
UNCITRAL Model Law on International Commercial Arbitration, among other things, by making 
arbitral awards final and prohibiting parties from further bringing the same dispute to courts. This 
could contribute to bridging the gap of con fidence and would allow for designation of Lao PDR as a 
seat of international arbitration proceedings and potential venue for recognition and enforcement of 
foreign arbitral awards. At present, cases involving foreign investors are considered by the WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  intern ational arbitration centers, such as Singapore International Arbitration Centre ( SIAC) or Asian 
International Arbitration Centre (AIAC) . Recognition and enforcement pleas are also deposited 
abroad, with no public record of recognition and enforcement by th e Lao PDR People 's Court currently 
available. Further support through technical assistance and capacity building could enhance the 
necessary developments described above .  
5  SELECTED TRADE POLIC IES AND PRACTICES BY  MEASURE  
5.1  Implementation of the Trade Facilitation Agreement  
5.1.  As a landlocked country, Lao PDR has a keen interest in full implementation of the Trade 
Facilitation Agreement (TFA), in order to expedite all trade and customs procedures. It has accepted 
the Protocol incorporating the TFA into the  WTO Agreement on 29 September 2015, being the second 
LDC to do so. It has notified A -type commitments under the TFA (13) on 17  September  2015, 
following by notification of the B -type commitments (6, to be implemented by 31 December 2020) 
and C -type commit ments on 2 March 2018. Actual implementation has started on 21 February 2018.  
5.2.  The new Trade Facilitation Road Map (TFRM) of Lao PDR for 2017 -22, which builds on the Trade 
Facilitation Strategic Plan for 2011 -15, focuses on facilitating documentary complian ce, including 
through establishment of the single window, and sets the following four practical targets: Reducing 
the time of export by 50%; Cutting the cost of export by 20% (predominantly through establishment 
of national single window and streamlining o f NTMs relating to exports, particularly of minerals and 
agricultural products); Reducing the time of import by 50%; Reducing the number of import 
documents by 30%. The results are expected to be achieved through (i) Developing institutional 
mechanism for effective coordination among line departments through Trade Facilitation 
Implementation Unit; (ii) Strengthening governance structure at sub -national level for improved 
communication, monitoring and implementation of the trade facilitation measures; (iii) Cross -border 
cooperation and regional integration; (iv) Collaboration with the private sector (v) simplification of 
procedures, like Single Window, One Stop Inspection and One Point Payment and publication of the 
relevant measures online; and (vi) Review o f Non -Tariff Measures (NTMs) for their drastic reduction 
and streamlining compliance procedures. Majority of the measures provided for in the roadmap are 
already implemented. Among those: single window; single stop inspection; post -clearance audit; 
risk ma nagement; advance rulings; pre -arrival clearance; introduction of procedure for appeal and 
enhanced transparency.  
5.2  Streamlining of Customs procedures  
5.3.  Throughout the review period, Lao PDR has continued to improve and expand the functionality 
of Automated S ystems for Customs Data Management (ASYCUDA World) . The system is currently 
used at 25 major border posts and offices, covering around 90% of formal trade. Risk management 
approach is applied. Electronic duty -tax payment system (SMART -Tax) has been in oper ation at 
ASYCUDA -enabled customs ports. With automation system, businesses are able to file customs 
declarations electronically, however the submission of the printed copies is still required. As per the 
Time Release Study (TRS) conducted in 2016 by Lao Cu stoms Department, the average clearance 
time of imports was 6 and a half hours, which indicates significant drop from the average clearance 
time of 11 and a half hours in 2012. Besides the measures taken by Lao Customs Department aiming 
at trade facilitati on, the improvement of the border procedures has been a combined result of efforts 
made under Greater Mekong Sub Region and ASEAN initiatives, particularly under the ATIGA and 
the ASEAN Framework Agreement for the Facilitation of Goods in Transit (AFAFGIT) . Streamlining of 
customs clearance process in Lao PDR was positively noted by the World Bank in its Ease of Doing 
Business Report 2019. The AEO (Authorized Economic Operators) scheme is expected to be launched 
by the end of the 2019.  The responsible autho rity has formed the AEO Steering Committee in order 
to drive the project smoothly . In 2016, Lao PDR acceded to  International Convention on the 
Simplification and Harmonization of Customs Procedures (Revised Kyoto Convention).  
5.3  Tariffs  
5.4.  Since 2014, the simpl e average applied MFN tariff has declined from well over 10% to 8.5%; 
in fact, the weighted applied average tariff is considerably lower, giving the 0.2% average rate on 
imports from ASEAN. Moreover, the tariff is predictable: 100% of the Lao PDR tariffs a re bound, at WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  an average rate of 19%, and therefore with relatively little scope for raising applied rates (26 tariff 
rates were misstated due to technical errors, which had been addressed and corrected).  
5.4  Import Licensing  
5.5.  Lao PDR adopts a uniform licensing policy and procedures which have been notified and 
accepted by WTO during the accession process. Three types of licen ces are in place: (i) Enterprise 
registration certificate, e.g. registration of a company which wants to do business in Lao PDR. The 
licence is granted within 3 days through the process that follows international best practices; 
(ii) Issuance of a business operating  licence, which requires information on the kind and the field of 
the business envisaged. Approval time and conditions depend on the sector;  (iii) Import licensing 
for particular products. For the latter category, both automatic and non -automatic licensing is in 
place. Non -automatic licensing applies to the products included in  the list established in 2012 for 
specific legitimate re asons (national security; protection of human, animal or plant life or health; 
and protection of environment). The relevant procedures are increasingly streamlined. For instance, 
import licensing for vehicle  is carried out through the National Single Windo w (NSW) since 
September 2019. The same (NSW) procedure is followed as far as the licensing of the motor vehicle 
is concerned. Finally, the list notified to the WTO in the course of accession contains products 
importation and exportation of which is prohibi ted on the basis of international obligations or for the 
sake of environmental protection. Additional internal licen ces are requested (quality control, etc.) 
for distribution of the products in Lao PDR.  
5.5  Trade Remedies  
5.6.  Lao PDR has recently made progress in  creation of the WTO -consistent legal framework with 
respect to trade remedies. The law on Safeguards was promulgated on 7 December 2017, while the 
law on Antidumping and Countervailing Measures was approved by the National Assembly in 
June 2019 and is exp ected to come into effect by the end of 2019.  
5.6  Export Policies  
5.7.  Lao PDR maintains export duties on a number of products. The list of such products has 
remained unchanged as per the Edict of the President on the List of Goods and Export Duty Rate of 
2012, as notified to the WTO upon accession. Lao PDR does not grant any agricultural export 
subsidies. For the products subject to export licensing, procedures identical to those used in import 
licensing are applied. Lao PDR does not provide any funding fo r export finance, export insurance or 
export guarantees.  
5.7  Special and Specific Economic Zones  
5.8.  SEZ development is taking a central role in the government investment promotion strategy, in 
particular, as far as investment in manufacturing is concerned. The SE Z are aimed at diversifying 
the economy integrating it into both – regional and global value chains, inter alia , adding value to 
strategic position of Lao PDR in the South -East Asia transport corridors. Lao PDR currently hosts 
12 Special or Specific Economic Zones (SEZ). Nevertheless, many zones are still at an early stage 
of infrastructure development. Only few zones have started production and exports. Incentives 
available in different SEZ vary.  In 2018, the value of investment in the SEZ h as reached some 
USD 3.34 billion, of which USD 50 million were invested by Lao PDR Government, USD 2.54 billion 
– by developers, and USD 696 million – by retail investors.  The focus of each zone reportedly varies 
from export processing to tourism and logis tic services and combination, depending on the potential 
of the areas and objective of development. There are about 597 business units registered in the 
zones to date, more than half are from China, followed by Thailand, Japan, etc. Some of the investors 
moved parts of their production facilities to Lao PDR. Jobs have been created for about 
44,000  people. Lao tian workers account for almost half of total employment in the zones. However, 
the two export processing zones, Savan -Seno Special Economic Zone and V ientiane Capital Special 
Economic & Trade Park (VITA Park), account for nearly 80% of total number of Lao tian workers. 
SEZs have yielded USD 31 million for the national budget and it is expected that this figure will more 
than double in the future as many factories have been built and some are now starting production. 
In 2018, Decree on Special Economic Zone in Lao  PDR, was promulgated aimed at simplifying 
procedures for investors, making them faster, more transparent and fairer, and ensuring that 
investors  have confidence in the system.  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  5.8  State Owned and State Trading Enterprises  
5.9.  Lao PDR does not have any state -trading enterprises (STEs) within the meaning of the GATT 
Article XVII. State -owned enterprises have a role to play in the economic development along with 
other private enterprises, especially in the provision of public services. There are currently 187 SOEs. 
Of these, 135 have Government as a majority shareholder while 122 are entirely owned by the 
State. All state-owned and private enterprises are ope rating under the same environmental and 
legal conditions. The Government envisages to reform SOEs by using measures and issuing various 
legal frameworks, such as: Decree on State -Owned Enterprise, Master plan for SOE development 
and reform in 2019 -2020, an d an Enterprise Development Strategy up to 2030.  
5.9  Reinforcing Protection of Intellectual Property Rights  
5.10.   Since its accession and in line with the commitment to bring its Intellectual Property (IP) 
regime in compliance with the WTO requirements, Lao PDR adop ted a new Intellectual Property Law 
in 2017. The New IP Law is moving the relevant regulatory framework of Lao PDR in closer 
consistency with international treaties and best practices. Among the major developments: third 
parties are provided with fuller ri ghts to protect their trademark through opposition procedures; the 
customs could seize goods in ex -officio action; the scope of administrative remedies is limited in 
favor of judicial proceedings; the grounds on which a criminal offense can be substantiate d, 
according to the types of rights, products, or infringement levels are simplified; the importance is 
given to new plant varieties along the lines of the requirements set forth in the International Union 
for the Protection of New Varities of Plants (UPOV ) Convention. At least 4 specific regulations 
dedicated to: plant varieties, IP agent 's qualification requirement, relevant customs procedures and 
administrative dispute resolution related to the IP violations are envisaged or being drafted.  
5.11.   Lao PDR has a lso joined the Protocol Relating to the Madrid Agreement Concerning the 
International Registration of Marks  (7 March 2016); Convention on the Means of Prohibiting and 
Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property  (22 March 2016); 
and Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits 
Arising from their Utilization to the Convention on Biological Diversity. An internal process aimed at 
joining the Hague Agreement Concerning the  International Registration of Industrial Designs is 
expected to be finalized in 2020.  
5.12.   Lao PDR is in contact with the Office of the Union for assistance in the development of its 
relevant legal framework based on the UPOV Convention and has acquired an obs erver status with 
the UPOV. The principal rules related to plant variety protection are incorporated in the Article 69 
to 91 of the 2017 Intellectual Property Law of Lao PDR. Moreover, Plant Variety Protection division 
was established in 2015, at the Depar tment of Intellectual Property with the role of administration 
and promotion of new plant varieties protection. Ministerial Decision on New Plant Varieties 
Protection is being drafted. Preparation of a guidebook for technical officers and operational use; 
training of the officers and the selection of the DUS Test Centers are envisaged as next steps.  
6  TRADE POLICY BY SECT OR 
6.1.  The sectoral trade policy of Lao PDR is aimed at (1) ensuring robust and stable economic growth 
that is not dependent, as it is at prese nt, on a few sectors such as exhaustible mineral resources; 
and (2) narrowing the current development gaps between and within regions in the country.  
6.1  Goods  
6.1.1   Agriculture  
6.2.  Agricultural sector maintains an important role in the economy of Lao PDR, contributing to 
maintaining food security and combating poverty. It significantly contributes to the GDP (15.7%), 
even though this share has declined during the review period in favo ur of manufacturing and 
services. The value of the agricultural production increased by  6.3% in 2018, following a trend of 
steadily growth. The share of agricultural products in total merchandise exports has risen from 
14.1% (2013) to 21.3% (2017). The top three export items are rubber, fruits and vegetables, and 
coffee. Given the level of s elf-sufficiency attained in several products, notably – in rice production, 
any increase of production has become available for export; moreover, existent land concessions WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  produced predominantly for export. Despite substantial total employment, which has r anged to 
61.3% in 2017, low labo ur productivity  and limited advanced technology  constitutes a major 
impediment to development . 
6.3.  Lao PDR has several agricultural program mes to enhance the productivity of the agricultural 
sector in particular through introduc tion of modern technology, expansion of irrigation and providing 
services to the farmers. Some of the inputs belonging to such program mes (in particular irrigation, 
electricity rates for the farm sector as well modern inputs) are subsidized. All subsidies fall under 
the green and development categories and are therefore deemed to be WTO consistent.  
6.4.  In addition, Lao PDR has distributed land concessions to foreign and national investors, which 
largely produce export crops and have significantly contributed to  the growth of agricultural exports. 
A moratorium has been declared on new concessions, while the Government analy ses the costs and 
benefits of those concessions and new regulations for their approval, which would include 
consultations with the local popul ation. Among the objectives of the review is too see how the 
linkages between those concessions and traditional farmers can be enhanced so as to ensure the 
spread of new technology as well as integration of the farmers into the processing of agricultural 
goods.  
6.5.  The Law on Agriculture of 1998 has not been amended and remains valid. The Government 
has decided to complement and operationalize the law by promulgating subject -matter specific 
legislation at the Ministerial and Department levels.  
6.6.  Lao PDR may ensu re minimum prices for certain agricultural products in case this is necessary 
for food security purposes. However, only a minimum farmgate price for rice remains in place and 
no other form of relevant market intervention has taken place.  
6.1.2   Forestry  
6.7.  During th e review period, in accordance with the 8th NSDEP, Lao PDR concentrated its efforts 
on sustainable recovery and effective management of its forests; forest development; as well as 
forest and forest resources protection. To address the persistent issues of illegal logging and timber 
trade, the Government of Lao PDR announced its interest in negotiating a Voluntary Partnership 
Agreement (VPA) on Forest Law Enforcement, Governance and Trade with the EU in February 2012. 
In October 2013 , the Ministry of Agricul ture and Forestry opened a Forest Law Enforcement, 
Governance and Trade (FLEGT) Standing Office with support from Germany's Agency for 
International Cooperation (GIZ). In 2015, the FAO – World Bank Cooperative Program, the 
SUFORD -SU project (Scaling up par ticipatory sustainable forest management project, financed by 
World Bank and Finland) and the GIZ ProFLEGT project have developed the Forestry Legality 
Compendium, which comprises all relevant legal provisions and provide a summary analysis on the 
forestry  legal framework, including legislation associated with forest and forestland and the use of 
forest products, including from production forest, plantations, forest conversion/concession areas 
and village use forests. It covers planning, harvesting, transpo rtation, processing and trade in 
unprocessed and semi -processed wood and finished products.  Formal negotiations have begun in 
2017 and are ongoing. The Department of Forest Inspection under the Ministry of Agriculture and 
Forestry is the national focal poi nt for developing the VPA.  
6.8.  By entering into the VPA with the EU, Lao PDR aims to improve opportunities for the Lao PDR 
timber industry to access the EU market, diversify their timber products and increase revenue from 
timber exports. The Government hopes to increase the portion of skilled jobs with higher wages and 
to develop opportunities for technology transfer to the La o PDR timber industry. Lao PDR also aspires 
to help ensure sustainable development of the forest sector, stop illegal logging, raise awareness of 
the benefits of timber legality in the country, enhance transparency and good governance and 
strengthen existi ng timber management policies.   
6.9.  Lao PDR has also introduced a ban on exports of unprocessed wood from natural forests with 
the aim to better control illegal logging and to promote the transformation of wood in Lao PDR.  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  6.1.3   Mining  
6.10.   The mining sector in Lao PDR u sed to generate significant revenue and has contributed to the 
steady growth of the economy for many years. Nevertheless, lately, the major mining operations in 
Lao PDR have seen a fall in production, predominantly due to drop world prices on minerals, and  the 
suspension of new mining concession allocations since 2012 . Under the 8th NSEDP Lao PDR's 
objectives for the sector include increasing the promotion of mineral processing by reducing the 
export of unprocessed minerals to increase the value of mineral products and ensure that the 
benefits from this sector contribute to improving people's livelihoods. The Law on Minerals was last 
revised in November 2017 in line with the above objectives.  
6.1.4   Electricity  
6.11.   Electricity is a major source of foreign exchange as most of the production is exported to the 
neighboring countries (mostly Thailand). Abundant, relatively cheap and ecological energy sources 
are also a major comparative advantage of the Lao PDR economy that the Government intends to 
exploit fur ther. Power exports represented about 26% of total exports in 2017. Lao PDR is developing 
a strategic plan to become the network center for a regional electricity transmission system by 2025 . 
Export markets include Thailand, Viet  Nam, Malaysia, Cambodia, a nd Myanmar.  
6.12.   Lao PDR has 61 hydropower plants with an installed capacity of 7,207 MW which can 
collectively generate about 37,300.6 GWh per year. Additional 36 hydropower plants are currently 
at various stages of construction. With an overall installed capa city of 4,184 MW, these plants will 
add another 20,892 GWh per year to the nation's power grid. Hydropower plants currently produce 
more than 86% of the country 's electricity. Nevertheless, Lao PDR is mindful that over -reliance on 
hydropower could lead to several problems: (i) limited potential, expected to reach its maximum by 
2030; (ii) need to install hydropower facilities along the watercourses and then transport the energy 
via inefficient power grid, often facing up to 20% losses in power supply, leadi ng to the need to 
import electricity; (iii) seasonal factors, e.g. disruptions during dry season; (iv) potential risk harm 
to environment and people. Recognizing the need to diversify energy generation, the Government 
of Lao PDR has started exploring the p otential of non -hydro renewables. It has established the 
development of renewable energy other than hydropower as one of its main priorities, aiming to 
increase the share of non -hydro renewable energies to 30% of total consumption by 2025. Studies 
show tha t Lao PDR has potential to develop solar power. Nevertheless, additional investments are 
necessary to make this happen. While the use of solar power was first recorded in 2014, its overall 
production remains insignificant in comparison to other sources.  
6.13.   Since 2005, a Rural Electricity Fund (REF) promotes the use of renewable energy in rural 
areas on the basis of a revolving capital principle with funding support from the International 
Development Association (IDA), the World Bank and the Norwegian Agency f or Development 
Cooperation (NORAD). According to the updated the Rural Electrification Master Plan (REMP), the 
Government has set the national electrification target at a household level to 94% by 2025. As of 
now, about 92% of the households are electrifie d. While the electrification program nears its 
completion, the power grid is increasingly facing new challenges related to the fast growth of 
electricity demand. The main challenges are persistently high distribution losses, with some areas 
experiencing lo sses of over 20%) and sub -standard electricity services, including low reliability of 
electricity supply due to overloading of the distribution grid particularly in major load centers such 
as Vientiane capital, Khammouane, Savannakhet, Champasak provinces.  Lao PDR is addressing the 
issue and is, receiving some technical assistance for its resolution, for instance, from the World  Bank.  
6.14.   Since 2013, biomass has also been used to produce electricity and accounts for roughly 
0.02-0.03% of Lao PDR 's overall ener gy portfolio. Since 2015, when the Hongsa power plant came 
on line, coal has also been used, and accounts for 14% of total electricity production.  
6.1.5   Manufacturing  
6.15.   Total value of manufacturing exports has significantly grown from about US D 270 million in 
2013 to US D 780 million in 2017 driven mainly by exports of electronics, telecommunication and 
electrical equipment from the two SEZs (Savan -Seno Special Economic Zone and VITA Park) to 
Thailand, as well as of food and beverages. While the manufacturing secto r was traditionally 
concentrated around garment and food and beverage processing, electrical and electronic parts WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  accounted for around half of total manufacturing exports in 2017. This shows that Lao PDR is getting 
integrated into the regional value chains . Addressing constraints to doing business outside of the 
SEZs and clarifying the incentive policies applicable within can create potential for further 
enhancement in exports. Nevertheless, contribution of services in value -added exports remains very 
small , ranging to less than 5%. Inadequate supply of financial and telecommunication services may 
also be a constraint on the diversification and upgrading of manufacturing firms, preventing them 
from moving up the value chain. Both for export -oriented and for domestic activities, Lao PDR 's 
manufacturing sector relies less on services inputs than peer countries.  
6.2  Services  
6.2.1   Financial Sector/ the B ank of Lao PDR (B OL) 
6.16.   The Bank of the Lao PDR (the BOL) is an entity and an agency equivalent to Ministry. The 
BOL is in  responsible for conducting monetary policy, financial stability and payment policy. It is the 
only agency by law to have right to issue money or national currency – kip. The operations of the 
BOL aims to maintain price stability through the stability of n ational currency; ensuring sound system 
of credit institutions and non -bank financial institutions; and contributing to socio -economic 
development plan of the Lao PDR. The Governor of the BOL also serves as the Chair of the BOL 's 
Board of Directors.  
6.17.   The a mended legislation on the BOL (2018), the Law and Commercial Bank (2018); and the 
establishment of the Law on Payment System (2017) provide an opportunity for the BOL to take 
into account good international practices, including on management of the BOL and  modernizing the 
instruments of the central bank while the Law on Commercial Banks allowed the BOL to move toward 
risk-based supervision and introduced relevant provisions on crisis management and bank 
resolution. To ensure the expansion of financial techn ology and cost -efficient payment system are 
safe and risks being addressed, the BOL has closely supervised the payment system through the 
establishment of the Payment System Department. Reflecting an anti -money -laundering effort, the 
Lao PDR was also delis ted from the grey list in 2017. Following the latter, the Anti -Money Laundering 
Office has been working closely with line ministries and associated competent authorities to conduct 
national risk assessment on Anti -Money Laundering (AML)/Counter Financing f or Terrorism (CFT) in 
preparation for the upcoming Mutual Evaluation under Financial Action Task Force (FATF) new 
40 recommendations in 2020.  
6.18.   During the review period, the BOL has continued to implement monetary policy and managed 
floating exchange rate r egime aiming to maintain national price stability as well as to support 
economic growth. The BOL also supervises financial system to ensure safe and sound 
implementation, expanding service network to access diversification of financial services 
countrywide , enlarging the electronic payment system to be prompt, modern and safe response. 
The above steps enabled the BOL to maintain its targets: the inflation rate remained low, ranging to 
2.04%; the LAK/USD exchange rate remained favorable; money supply (M2) gr ew by 8.37 % 
compared to the same of last year; the commercial banks are growing and sound with deposits to 
GDP ratio accounting for 48.33% and credits for 45.30% of GDP; the Non -Performing Loan (NPLs) 
to total credits ratio marked 3.12% and overall foreign  reserve covered 3.23 months of imported of 
goods and services. In 2018, the BOL has also established risk -based supervision manual, 
commercial bank 's balance sheet and auditing instruments and created early warning system aiming 
to supervise the soundness  of banking system. At the same time, commercial banks assessment 
was initiated, supporting risk -based approach to supervision. Moreover, the BOL has continued to 
encourage commercial banks to improve their services via mobile application in an aim to faci litating 
in settlement to be modern and sound such as land tax, electricity -water payment, and leasing and 
road tax.  
6.19.   At the end of 2018, there were 43 commercial banks (including 3 state -owned banks, 
1 specialized bank, 3 joint -venture banks, 8 private ban ks, 9 subsidiary banks, and 19 foreign branch 
banks), 109 branches of commercial banks, 533 service units, 35 exchange bureaus, 1,225 ATM 
machines, 3,852 EDC countrywide and 1,426,966 ATM card. There were 185 non -banks (of which, 
there were 20 deposit -taking microfinance institutions, 77 non -deposit -taking MFIs, 30 savings and 
credit unions, 29 leasing companies, 27 pawn shops, and 5 transfer agencies).  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  With regard to capital market mobilization, the Lao Securities Commission has worked on improving 
regula tions of securities supervision task including securities exchange, market intermediaries and 
listed companies in order to ensure compliance with regulations. The Law on Securities is also being 
revised and is expected to be submitted to the National Assem bly by the end of 2019.  
6.2.2   Telecommunications  
6.20.   The telecommunication regulating agency in Lao PDR is the Lao Telecommunication 
Regulatory Authority (LTRA), established in 2017. Lao National Internet Center (LANIC) under MPT 
provides National Voice Exchange (NVX) facilities for interconnection between domestic telecom 
operators, International Voice Gateway (IVG) for being national gateway for international calls.  The 
functioning of the LTRA is guided by the following principles: (i) promotion of comp etition, 
connectivity and coverage; and (ii) ensuring independence in the governance and in the allocation 
of telecom resources according to Lao PDR law and regulation. Accordingly, the LTRA is fully 
independent from interference by operators not receiving  any benefit from them so as to ensure a 
level playing field in terms of competition, numbering assignment, consumer safeguard and 
licensing. The Ministry of Post and Telecommunications is responsible for policy formulation and 
implementation in this area,  and prior to the establishment of LTRA, it ensured regulation in the 
sector.  
6.2.3   E-commerce  
6.21.   Lao PDR has taken meaningful initial steps in drafting legislation related to e -commerce.  It 
has introduced the legal framework for the recognition of electronic docum ents and signatures, 
adopted provisions limiting intermediary liability. In addition, some of the regulations already 
implemented should be updated to ensure consistency with dynamic global trends, as well as 
complemented with regulations meant to foster t rust in digital markets, such as the protection of 
online consumers and data privacy. The Decree on E -Commerce aimed at bringing the relevant legal 
framework in compliance with best practices is currently drafted.  
6.2.4   Transport  
6.22.   Transport is one of the key mea ns for Lao PDR to support the transformation from a 
land-locked to land -linked country . To achieve this, the 8th NSEDP emphasizes on developing 
economic corridors; reducing trade barriers, promoting cross -border investment, and capitalizing on 
the benefits  of being member of regional and international economic integration and corporation . To 
promote regional integration and economic growth, Lao PDR participates in the two major regional 
agreements, the Cross -Border Transport Agreement (CBTA) and the ASEAN F ree Trade Area.  
6.23.   Being a landlocked country, Lao PDR depends heavily on road transport for trade links both  
externally and internally. The transport sector in Lao PDR can be described as thin, consisting of a 
dozen large players (defined as having a fleet s ize of more than 50 trucks) and many small firms 
(companies with less than 5 trucks or owner -operators). Productivity levels in the Lao PDR transport 
sector are generally very low. The low annual mileage, together with the high cost of capital and low 
profit margins, prevent companies from investing in more expensive, yet more cost -efficient 
vehicles, which in turn increases variable operating costs.  
6.24.   Meanwhile, the development of the road network is vital in reducing transport costs and 
boosting trade. Rur al areas, where the infrastructure is still largely lacking, are particularly 
concerned. In 2017, during the 10th Regional Environmentally Sustainable Transport (EST) Forum in 
Asia, Lao PDR joined  Vientiane Declaration on Sustainable Rural Transport toward s Achieving the 
2030 Agenda for Sustainable Development, expressing its  commitment to promote inclusive, 
affordable, accessible and sustainable rural transport infrastructure and services, thus facilitating 
improved access to basic utilities and services i ncluding health and education by the rural farmers, 
agricultural workers, girls and women, youth, and differently abled and vulnerable groups.  
6.25.   The biggest recent development in the Lao PDR economy is the construction of Lao -China 
railway. This is an area o f common ground between the private sector and the Government of 
Lao PDR. The construction is expected to conclude in 2021. The railway is 414 km long and runs 
from Vientiane capital to Boten border, where it connects to Chinese railway.  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  6.2.5   Tourism  
6.26.   The Constitution of Lao PDR, as amended in 2015, stipulates that the State and society shall 
promote, develop and open up the country to cultural and historical tourism and eco -tourism. 
According to revised 2013 Law on Tourism, the Government of Lao PDR se ts policies for tourism 
development. T ourism is one of the eight priority program mes of the socio -economic development 
of the Lao PDR Government. It has a strong contribution to employment. Notably, the percentage 
of women employed as housekeepers in Lao P DR's accommodation subsector is nearly 100%.  
6.27.   Improved of transportation system is a key for tourism development of Lao PDR. Development 
of the sector has been assisted by financial institutions and donor countries such as the construction 
of roads No. A3, No. 8, No. 9, No.12, No. 18B; the construction of Mekong bridges; improvement 
and construction of access roads to tourism sites, etc. At present, 22 of 27 international checkpoints 
are able to issue visa on arrival. In July 2019, electronic visa service wa s also launched. There are 
now 4 international airports – in Vientiane Capital, Luang Prabang, Savannakhet, and Pakse . These 
expand the alternatives for tourists to reach and visit the country. Major efforts are paid towards 
further improvements of infrast ructure and quality of the services available to the visitors.  
6.28.   Because of its strategic location (in the center of Indochina and South -East Asia), Lao PDR is 
often considered to be a "add on destination ". Therefore, tourists ' circuits integrating Lao PDR w ith 
neighboring countries and increase in tourism cooperation with regional partners, including ASEAN, 
are the essential factors to contribute to the success of Lao PDR tourism.  
6.29.   In recent years, Lao PDR has seen very impressive tourism development. Various activities 
have been organized throughout the country, tourist attractions have been improved and festivals 
staged, thus enhancing Lao PDR 's' appeal as a tourist destination within the region.  In 2018, more 
than 4.1 million overseas to urists visited Lao PDR within the framework of "Visit Laos Year 2018 ", 
an 8.2 % increase compared to 2017. Tourism generated revenue of more than US D 755 million in 
2018 alone. In 2019, it is expected that at least 4.5 million people will visit Lao PDR, gen erating 
revenue of more than US D 700 million.  
6.30.   Lao PDR works closely with other sectors and local authorities to explore plans and develop 
visitor attractions in a way that is as sustainable as possible. Tourist sites have been classified into 
three categor ies: natural, historical and cultural. So far, 985 sites have been surveyed and identified.  
PART II  – MAJOR THRUSTS OF LA O PDR 'S TRADE POLICY REFOR MS IN THE UPCOMING 
YEARS  
1  INTRODUCTION  
1.1.  As described in Part I above, since its accession to the WTO, Lao PDR has made a substantial 
effort in bringing its trade regime and economic policies in line with best international practices. 
Lao PDR has adopted necessary laws to comply with best international practices and has revised its 
laws in line with the requirement s of its international and regional commitments. It has adopted a 
large number of plans and policies in view of transforming its economy and trade pattern to the 
requirements of international and regional integration and to ensure that the private sector b enefits 
of a conducive environment to develop its entrepreneurial spirit and to become competitive so as to 
be able to benefit from its comparative advantage. The export strategy defined how Lao PDR wants 
to take advantage of its integration into the world  economy. The Law on Lawmaking ensures that 
new laws and regulations are drafted in a transparent way and that effects of laws and regulations 
on the environment and other public goods are accounted for. Many technical regulations have been 
adopted and san itary and phytosanitary measures – implemented to ensure that products respond 
to the demand of the global market. Lao PDR has adopted Intellectual Property Rights legislation 
responding to international standards and a trade regime in line with the access ion commitments. 
It has also revised investment legislation to ensure equal treatment of foreign investment and 
defined a policy for Special Economic Zones to attract foreign investment.  
1.2.  As a result, now Lao PDR has laws, policies and program mes, which sho uld facilitate its 
integration into the world economy and lead to the required diversification of its economy and an 
inclusive development, putting special emphasis on underprivileged regions and people. However, 
the Government of Lao PDR is aware that ado pting laws and program mes is one thing, their efficient WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  implementation another. Lao PDR can only reap the benefits of new laws and program mes, if they 
are implemented effectively and efficiently. This is unfortunately not yet fully the case. There is 
sometimes still confusion, which laws and regulations apply; how to ensure that they are 
implemented according to their purpose. A lack of full understanding of the laws, which negatively 
affects their application, and the absence of monitoring and control  systems are the major 
impediments. Therefore, the Government 's priority in the coming years will be to address 
three  major issues: (i) Implementation of the laws and development program mes; (ii) Increasing 
efficiency and effectiveness of the reform polici es; and (iii) Taking advantage of participation in 
regional and multilateral rule making.  
2  IMPLEMENTATION OF TH E LAWS AND DEVELOPME NT PROGRAM MES 
2.1.  The Government of Lao PDR intends to address the following identified issues of 
implementation:  
2.1  Measures to ensu re that implementation instruments are established within a 
reasonable time frame after the promulgation of the laws  
2.2.  Still too often new laws are passed, but implementation instruments containing necessary 
instructions on how to implement them are delayed.  This creates insecurity of law which hampers 
development and creates confusion among the authorities, which are requested to implement the 
law, as well as among the economic agents supposed to follow the laws. The Government is aware 
of the issue and will  evaluate the situation in view of improving the implementation of the laws in a 
timely manner.  
2.2  Measures to ensure that that the implementation instruments are fully consistent 
with the spirit of laws promulgated  
2.3.  While decrees are checked concerning their  consistency with laws and other instruments are 
often passed without scrutiny by the authorities in charge to ensure compliance with international 
commitments. At the same time, provincial authorities, within their mandate of maintaining peace 
and stabili ty in their provinces, adopt acts which are not in line with the laws of the land. The 
Government is looking into ways and means to ensure that implementation instruments are fully 
consistent with the spirit of the law and applied uniformly on the whole te rritory.   
2.3  Training measures proposed for Ministries and Agencies in charge of implementation 
to ensure efficient and coherent implementation.  
2.4.  Often agents required to implement new measures are not sufficiently informed or trained to 
be able to apply them . Therefore, they continue to apply the old procedures with which they are 
familiar leading to inconsistent application of laws and insecurity. The Government therefore intends 
to review the training needs of all agents in charge of implementation of the n ew laws to define a 
corresponding training program me. The Government would need technical assistance to develop and 
implement such a training program me and submits hereby a respective request to the Members of 
WTO.  
2.4  Measures with respect to review and strea mlining of the procedures  
2.5.  The proliferation of new laws and procedures has led to confusion and incoherencies. Moreover, 
experience over the last few years has shown that some of the measures did not have the intended 
effect or had unintended effects, whi ch were negative for the development. The Government has 
therefore identified the following needs:  
(i)  Review of the licensing procedures : The Government has recently requested the implementing 
authorities to propose ways and means to streamline licensing req uirements and procedures 
and to conduct a critical review of all licensing requirements in terms of their need and 
usefulness, so as to avoid unnecessary requirements hampering the economic development. 
At the same time, the Ministry of Industry and Commer ce is reviewing automatic and 
non-automatic licensing requirements with a view of abolishing most of the automatic licensing 
requirements. Indeed, the purpose of the automatic licensing requirements was largely 
statistical. The Department of Import and Exp ort (DIMEX), has well advanced in its work and WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  is expected to submit a proposed list of all licensing requirements at the beginning of next 
year. Given the improvement in the customs procedures, it is no longer necessary to have 
this additional requirement . Through the new licensing policy,  the Government aims to reduce 
the burden on the private sector and improve its rating in the business environment index of 
the World Bank. Technical assistance in establishing this new licensing policy would be 
appreciat ed. 
(ii)  Improving coherence of various regulations and coordination between central and provincial 
applications : Promulgation of laws and regulations has responded to specific needs of reform 
and have not always been made considering the overall requirements of the changing 
environment. A review of the consistency of the measures and ensuring coherence of their 
application both at the central level and at the provincial levels is now required. In particular 
duplication of measures and procedures a t the central and provincial level or variations in 
application of the same measures at the two levels have to be addressed. The Government 
therefore intends to make a review and evaluation of all the measures in terms of their 
consistency, avoidance of du plication of measures as well as with the aim of streamlining 
them. For this purpose, the Government envisages to undertake the study with the support 
of a regional expert having experience in this field in other ASEAN Member States and who 
can bring best international practices to this exercise. Technical assistance in support of this 
project would be highly  value.  
(iii) Improving transparency and accountability : Implementation of reforms depends on 
transparency and accountability. Only if the governmental agen ts and the private sector 
understand and agree with measures proposed, will they be fully implemented. Agents have 
to be aware that conformity of their action with the measures promulgated will be checked. 
For this purpose, the Government will:  
(a)  Ensure tha t laws, decrees and regulations are published promptly in an accessible way 
to everybody : The Government has made great progress in this domain by publishing 
online the Official Gazette as well as the trade portals on all procedures and regulations 
which h ave a direct linked to trade in goods and in services. Continuing to provide the 
necessary resources to ensure that those platforms are up to date and relevant is a 
priority of the Government. One bottle neck is the translation of the information into 
English. While Lao PDR benefits from technical assistance to keep up the portals, it 
will need financial support to ensure the up -keep and especially the translation of the 
content of the official Gazette.  
(b)  Inform and consult with the private sector : Regular consultations with the business 
community through the dialogue has greatly improved the coordination between the 
Government and the private sector and is deemed very useful by both sides. Such 
consultations could be used to identify problems with  implementation of new measures 
and reforms. The private sector which is at the receiving end of measures is an 
excellent monitoring source of how well measures and reforms are implemented. The 
Government intends to strengthen this dialogue in particular i n the following ways:  
• Ensure participation of MSMEs and underprivileged segments of the society. 
Unfortunately, currently, the consultations are largely limited to bigger companies, 
which have resources to participate, while MSMEs are often lacking means and 
knowledge to effectively engage in such consultations. Special efforts to inform 
and train MSMEs and underprivileged groups (especially women entrepreneurs)  
are needed. Technical assistance for this purpose would be highly appreciated and 
necessary;  
•  Conduct regular assessment of implementation and the effects of various 
measures. Such oversight would allow to adapt laws and procedures to the 
requirements of development. A monitoring and evaluation system which provides 
timely statistics on the effects  of the measures implemented would allow the 
Government to adjust reforms and policies according to their purpose. To start, 
the Government intends to distribute to the private sector specific questionnaires 
on various measures implemented to monitor and e valuate their impact. Technical 
assistance to establish these questionnaires would be necessary . WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  (iv) Continue implementation of the trade facilitation roadmap : The Government is successfully 
implementing a road map for the trade facilitation exercise and consi ders this activity essential to 
ensure that Lao PDR can participate in regional and global value chains by ensuring speedy and 
efficient flow of goods, services and technology. The Government believes that an integration of the 
trade facilitation measures with the activities mentioned above will greatly enhance the business 
environment in Lao PDR and equip it to integrate as much as possible in regional and global 
distribution of value -added activities through value chains.  
3  INCREASING EFFICIENC Y AND EFFECT IVENESS OF THE DEVEL OPMENT AND REFORM 
POLICIES  
3.1.  Lao PDR has, in the last few years, adopted a tremendous number of policies in view of 
integrating its economy into the world trade system and of ensuring efficiency of its private sector 
– the main source of development. Unfortunately, the resources and measures adopted have not 
necessarily been explicitly linked, so that an establishment of a causal relationship between the 
measures and the intended objectives is neither possible, nor feasible. The Government  has 
established program mes to address perceived weaknesses in its economic structure such as the 
issue of increasing income disparity and the distribution of benefits of development; the need to 
diversify its economy as well as increasing the value added created in the economy (in particular 
through the transformation of its natural resources, including its agricultural potential), access to 
technology and foreign investment. However, the effects of those measures in terms of their 
objectives seem to be la gging behind. Establishing the efficiency and coherence of the various 
program mes will now be a priority for the Government.  
3.2.  For this purpose, the Government intends to implement the following measures: (i) review of 
the various policies and program mes adopted and their coherence; (ii) establishment a causal 
relationship between measure and their objectives ( the Government has already started to review 
its SOEs, their justification and their efficiency, the issue of licen ces and the policy of land 
concessi ons); (iii) attribution of various measures and budget outlays to particular development 
programs so that their efficiency and effectiveness can be traced; (iv) establishment of a monitoring 
and evaluation system for major development initiatives and measu res. Nevertheless, the 
Government does not have the necessary resources and capabilities to fully implement this 
ambitious plan and would need technical and financial assistance.  
4  TAKING ADVANTAGE OF PARTICIPATION IN REG IONAL AND MULTILATER AL TRADE 
POLICY NEGOTIATIONS  
4.1.  The Government intends to fully benefit its participation in regional and multilateral trade 
negotiations and fora. Its objectives in those negotiations are threefold: (i) ensuring access to the 
markets for its products and services: th e Government shifts its attention there from tariff measures 
to SPS, TBT and other restrictive measures (safeguards and unilateral measures) which are the 
major obstacles to its exports. The Government believes that such unilateral measures should not 
be applicable to the lower income developing countries (LIDCs) which appose no threat to any 
Member given their small export amounts; (ii) creation of a development -conducive environment 
for Lao PDR 's, among others, with respect of the subsidy disciplines, whi ch ensure that Lao PDR has 
a fair stake in international trade and still can implement measures to improve the efficiency and to 
bridge the technological gap in its economy; (iii) adhering to the best trade practices: regional and 
multilateral negotiations  help Lao PDR to adapt its trade and economic policies to best international 
practices. Lao PDR is fully aware that most benefits a country could reap from liberalization is not 
the concession from other countries, but the implementation of reforms in its own economy. Lao  PDR 
has used its accession to the regional trade agreements as well as its WTO accession to modernize 
its policy framework. It uses the on -going negotiations as a guide for further adaptation of its policies  
to the ever -changing internatio nal environment.  
4.2.  Lao PDR recognizes importance of participation in the regional trade agreements 
(implementation of the strengthening of the integration within ASEAN; RCEP negotiation and various 
bilateral trade agreements, BITs and other investment agreem ents, as well as agreements for 
avoidance of double taxation (DTTs). Regional integration of its economy is essential for Lao PDR 
given its high concentration of both imports and exports within the region, due in large part to its 
landlocked position, and the high growth potential of the region.  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  4.3.  Lao PDR also puts a high emphasis on an inclusive multilateral system with WTO as its 
guarantor. It shows its commitment to WTO by :  
(i)  fulfilling its notification obligation to the Organization to the best of its cap acities.  Lao PDR will 
devote 2020 to making sure that it is up to date on its notification commitments. The relevant 
schedule of notifications was developed by the Ministry of Industry and Commerce and is now 
being progressively implemented. Lao PDR puts g reat emphasis on the transparency function 
of WTO and therefore believes that it has to lead by example. However, Lao PDR is of the view 
that the notification obligations should consider the importance of the member state in 
international trade. Low income  developing countries, which do not influence the international 
market (neither as importing nor as exporting country) and that have only limited resources 
to influence the trade regime, should regularly report changes in the trade regime, but may 
not need  to provide regular information on certain other measures, for instance, subsidies, for 
which they have no means and which therefore do not change from one year to the other in 
significant amounts.  
(ii)  participating actively and in a consensus -oriented way in  the on -going negotiations.  Lao PDR 
is concerned about the present crisis in the multilateral trading system and the increase in 
unilateral measures and protectionism. Lao PDR is aware that it cannot contribute significantly 
to the resolution of the issues  which are responsible for the present crisis. However, it believes 
that each Member should do whatever it can to confirm the usefulness of the system and to 
demonstrate its attachment to its preservation. Lao PDR shows this by the following: (a) It 
intend s to sign on to the Information Technology Agreement ( ITA) I and ITA II agreements, 
thereby manifesting its willingness to abide by further liberalization measures; (b) It has 
decided to join the work under all the three Joint Statement Initiatives address ing the "new" 
issues – the Joint Statement on E -commerce, the Joint Statement on Investment Facilitation 
for Development and the Joint Statement on MSMEs, thereby showing its willingness to 
compromise and to accept that so called new subjects need to be in troduced into the system. 
Nevertheless, Lao PDR believes that the unresolved issues of the DDA should have priority 
and is concerned about not having the required resources to fully participate in the 
negotiations. However, Lao PDR is confident, that the o ther WTO Members would consider its 
constraints and the need not to neglect issues like domestic support in agriculture, issues 
which are essential for its rural development.  
(iii) support of the current efforts to reform the WTO , which Lao PDR considers to be a n essential 
element for the survival of the inclusive multilateral trading system. Lao PDR acknowledges 
the need to improve the functioning of the WTO system in a way that takes into consideration 
the changing global realities to be inclusive, transparent and rules -based system.   
PART III  – LAO PDR 'S GRADUATION PREPARA TION POLICY  
1  INTRODUCTION  
1.1.  Lao PDR is well on its way to fulfill the graduation criteria and to pass from the status of an 
LDC to the one of a developing country: it fulfills the 2 out of the graduation criteria (income per 
capita and the Human Asset Index (HAI), and if this is confirmed in 2021, which seems very likely, 
Lao PDR will graduate in 2024 and has to prepare a transition strategy with the United Nations 
support so that effective graduation would take place. Graduation fr om the LDC status is a positive 
development and a natural consequence of Lao PDR 's successful development. It welcomed by the 
Government. Graduation, however, poses new challenges for the sustainable development of  
Lao PDR as its conditions on the international markets will become more difficult.  
1.2.  The purpose of Lao PDR 's policy response to this challenge is to ensure that the graduation is 
not hampering its sustainable development by (i) identifying possible risks a ssociated with the 
graduation and (ii) implementing the appropriate measures to respond to this new challenge.  
1.3.  Lao PDR 's development issues are well -known and are already being addressed by the 
Government. To ensure a continuation of Lao PDR 's successful d evelopment, Lao PDR needs to 
address some longer -term issues related to its macroeconomic framework, its external vulnerability 
and its human resources development. These issues are being addressed by the Government, 
especially in its implementation of the  2030 SDG Agenda. Full implementation of the measures WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  outlined in the agenda will greatly contribute to ensuring that Lao PDR 's development will be 
sustained and that graduation will not negatively affect its development strategy. The transition 
strategy f or the graduation process therefore is closely linked to a successful implementation of the 
2030 Agenda, which will have to be fully integrated into that strategy.  
1.4.  In addition, to ensure a smooth transition during the graduation process, Lao PDR will have to 
define a certain number of short -term measures to ensure that the change in status is spread over 
a time period in line with the needs of Lao PDR to adjust to the new status.  
1.5.  Therefore, the Government is adopting the following approach to the design of its transition 
strategy: (i) Short -term measures to ensure a smooth transition of Lao PDR from its LDC status 
through providing sufficient time for the economy and its actors (both public and private) to adapt 
to the new conditions in the international mar ket; (ii) Longer term measures to ensure that the 
identified bottlenecks towards a sustainable and inclusive development of Lao PDR are lifted by 
concentrating in a targeted manner the main obstacles.  
2  SHORT -TERM MEASURES TO ENSURE A SMOOTH T RANSITION FROM THE LDC STATUS  
2.1.  The loss of LDC status affects Lao PDR 's development in the following three ways: (i) Loss of 
LDC-specific preferences in trade relations; (ii) Loss of certain flexibilities in terms of specific 
flexibilities at the WTO granted to LDCs; (iii ) Possible loss of ODA or being subject to more restrictive 
terms.  
2.1  Loss of trade preferences  
2.2.  LDCs benefit of special preferences of access to the markets in both goods and services.  
2.1.1   Trade in goods  
2.3.  As an LDC, Lao PDR has been granted by most developed and m any emerging markets "duty 
free/quota free " (DFQF) access. Nevertheless, the loss of these preferences will be minimized for 
Lao PDR for the following reasons: (i) the preferences in industrial good are rather minimal and often 
are not used due to high log istical costs and fierce competition from the other Members, including 
LDCs. In agriculture the preferences can be more important, however Lao PDR uses preferences of 
only three countries (Canada, EU and Japan) in a meaningful way; (ii) Lao PDR is the LDCs  that has 
a large share of trade (90% of exports) covered by the Free Trade Agreement. The change in the 
LDC status will only affect very marginally the access of Lao PDR to those markets. Lastly, (iii) the 
large part of Lao PDR 's exports (natural resource s) is not affected by tariffs and therefore will not 
face additional impediments in its markets. However, Lao PDR takes step towards diversifying its 
exports and producing more value -added manufactured goods. For this purpose, Lao PDR 's strategy 
is first a nd foremost the integration into regional and global value chains. This strategy will be 
affected by the preferences for LDCs only marginally.  
2.4.  The strategy of Lao PDR in terms of mitigating factors in its transition is based on the following 
measures (i) further integration of its economy into the regional market and labo ur distribution 
process through strengthening its regional Free Trade Agreements (especially ASEAN, ASEAN +6 
and RCEP) and (ii) negotiating with preference granting WTO Members a smooth tr ansition from 
references granted to LDCs to preferences granted to developing countries. In terms of its present 
ad potential markets the following countries will have priority:  
• China, Japan and Republic of  Korea: Lao PDR within its free trade agreements w ith those 
countries (ASEAN 16 and RCEP) would strive to ensure that it is excluded from exemptions 
to the free trade agreements for products of interest to its export sector, in particular in 
agricultural and agro -processed products.  
• European Union (EU), Canada and the United States of America (U.S.): The EU is probably 
the most interesting market for Lao PDR 's exports outside of the region, especially if 
Lao PDR diversifies its manufacturing capacity. Lao PDR will lose its access to the EU 
market under Ev erything but Arms (EBA) program me which is limited to LDCs. While the 
EU grants graduating LDCs a 3 -year extension of the EBA access to its market, to continue 
to profit from substantial preferences Lao PDR has two options: (i) benefiting from the WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  region t o region FTA being discussed and (ii) apply to EU 's preferences + scheme. Given 
the potential of the EU market for Lao PDR 's diversification strategy, Lao PDR envisages 
to seek adhesion to the EU preferences + scheme. This needs careful preparation as 
granting of these preferences is conditional upon ratification and implementation of the 
23 international conventions. Therefore, the immediate discussion about its participation 
in the EU preferences scheme is crucial and the EU 's addition supports to provide  Lao PDR 
in this field through an extension of the ARISE + program me are needed.  
2.5.  Lao PDR is, at present, not eligible for the US preferences scheme as it does not fulfill the 
political conditions attached to it. The US is potentially an important market fo r Lao PDR 's policy of 
diversification of its exports given the size of the US market, the on -going changes in the USA import 
regime and the continuing dislocation of labo ur-intensive industries out of China into South East 
Asia. Given a certain similarity between the US and the EU requirements attached to preferences, 
Lao PDR seeks negotiations with the U nited States  to combine its efforts to have access to the two 
preferences schemes as well as the support to be able to join them.  
2.6.  Lao PDR has al so started to look into the feasibility of negotiations with Canada and some other 
markets for its product to ensure both (i) an extension of the application of their preferences for 
LDCs as well as (ii) the future arrangements of preferences based on is e xport structure and 
capabilities.  
2.7.  Lao PDR will also use these negotiations to discuss the specific support they may agree to 
provide Lao PDR in its graduation process in particular the development of its production capacity in 
line with export potential i n those markets.  
2.1.2   Trade in services  
2.8.  Lao PDR will also lose the preferences granted by some 23 WTO Members under the services 
waiver. The loss of those preferences is, however, of very limited importance to Lao PDR for the 
following reasons: (i) the preferen ces granted are of small interest to Lao PDR; (ii) Lao PDR 's exports 
of services is largely limited to tourism and transport, which are not benefiting of preferences and/or 
which are covered by regional free trade agreements. Lao PDR 's strategy therefore i s to start 
negotiations with potential services market on a product -targeted basis to define programs of 
enhancing trade in services which encompass access and the promotion of its delivery capacity 
considering potential services exports rather than actual  exports, which are minimal. For the purpose 
of the above actions, the Ministry of Industry and Commerce is already creating a negotiation team 
in charge of those negotiations with focal points in the relevant Ministries and in cooperation with 
the private  sector.  
2.2  Loss of certain flexibilities granted to LDC WTO Members in terms of commitments  
2.9.  Lao PDR, as a recently acceded WTO Member has taken many commitments which LDC 
Members were not required to undertake. Therefore, the loss of LDC flexibilities will be limited:  
(i) the Trade Facilitation Agreement (TFA) : Lao PDR 's right to have access to the category C 
measures of the Trade Facilitation Agreement is not affected by its change in status;  
(ii) the Agreement of Agriculture: Article 9.4  provides Net Food Importing Developing Countries 
(NFIDCs) with flexibilities in granting export subsidies. Lao PDR does not provide export 
subsidies for agricultural products and does not intend to provide such subsidies. It has, 
however, not forgone its right to do so in the future. As Lao PDR continues to be a NFIDC, it 
will continue to benefit from this right. However, given Lao PDR 's impressive increase in 
agricultural production and the fact that it has currently become self -sufficient in most food 
items and it is now gradually becoming a net exporter of food ot the neighboring countries 
especially in terms of clean and safe food. Lao PDR envisages to start preparation to the loss 
of this flexibility in the medium term.  
(iii) the Subsidies and Counter vailing Measures (SCM) : Lao PDR will lose flexibilities in granting 
export subsidies and imposing tariffs under Article 27.2 of the Agreement. While this is at the 
present time of minor concern to Lao PDR, it might become an issue in its diversification 
policy: Lao PDR will be restricted in the support it can provide to its nascent industry. However, WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  this does not mean that Lao PDR cannot implement an industrialization policy, rather it has, 
to adapt the instrument it uses to do so are the WTO requirement. The Government therefore 
intends to establish an ad hoc working group to elaborate an industrial development policy 
including the support it requires from WTO Members to implement it in tie for the discussion 
on its graduation in 2024. It hereby requests technical assistance from WTO Members in 
elaboration of such a policy . 
(iv) the Trade -Related  Aspects of Intellectual Property Rights  (TRIPS) : While the general transition 
period of the TRIPS Agreement is not affected by the change in Lao PDR 's status at the WTO, 
Lao PDR will lose the benefits of the pharmaceutical and agro -chemical waiver upon 
graduation. Although Lao PDR does not benefit at present of this waiver, the Government 
intends to keep the possibility to participate in this market, which  is of potential interest to its 
economy. Lao PDR will therefore request, as part of the transition measures - that it can 
continue to benefit of this waiver until its expiration in 2033.  
(v)  Dispute settlement : LDCs benefit from some self -restraint, flexi bility in consultation as well as 
support from the WTO Secretariat, as well as free support from the Advisory Centre on WTO 
Law (ACWL). Lao PDR intends to maintain these flexibilities as much as possible. Given that 
the modification of the WTO dispute sett lement mechanism is currently under negotiations, 
Lao PDR will (i) follow the negotiations and defend its interests there and (ii) start negotiations 
to adhere to ACWL and on its contribution.  
2.3  Potential loss of the ODA and tightening of its conditions  
2.10.   This might well be potentially the biggest impact of Lao PDR 's graduation. However, 
independently of the graduation, Lao PDR has to prepare itself for a lower contribution of ODA in its 
external financing, which is actually already occurring. This is of partic ular importance to Lao PDR 
given its external imbalances and dependence on foreign funding to continue financing of its 
infrastructure, building up of its human asset basis and diversification efforts. In the longer term, 
the solution to this problem will depend on the capacity of Lao PDR to attract foreign direct 
investments and to increase its internal savings rate. This shift from concessional to commercial 
financing will, however, take time and mitigating measures are, thus, essential.  
2.11.   There are four ma jor sources of the Official Development Assistance (ODA) for Lao PDR:  
(i) The International Financial Institutions  (IFIS) are the biggest source of external concessional 
financing. IFIS (and the UN) have no specific LDC focus and therefore graduation shoul d not 
affect the resources available to Lao PDR. However, Lao PDR has to prepare itself for a certain 
tightening of lending conditions i.e. higher interest rates and shorter repayment periods. This, 
however, will depend on its overall development and exter nal balance and not the LDC status;  
(ii) Bilateral ODA: There is limited LDC -specific support by bilateral donors. However, some of the 
major donors in Lao PDR, such as the DIFID and the GIZ, do have commitments to concentrate 
their assistance on LDCs and therefore might be less inclined to support Lao PDR;  
(iii) LDC specific support: EIF, ACWL as well as some UN funds such as the UN Capital Development 
Fund (UNCDF), the Technology Bank for LDCs, the United Nations Framework Convention on 
Climate Change  (UNFCCC) LDC Fund (LDCF) among others, are LDC specific. For Lao PDR the 
following program mes are of relevance: EIF and ACWL. The EIF grants an extension period 
for graduating LDCs and ACWL is available to non -LDCs albeit at a cost. Lao PDR intends to 
negotiate generous extension periods for these two program mes in its transition strategy. The 
LDCF: The loss of support from this Fund may well be of great importance to Lao PDR given 
its big exposure to climate change issues. To be able to implement its clim ate change 
mitigation measures, Lao PDR will elaborate a clear program me of measures to be submitted 
to the donors. It is believed that the elaboration of a coordinated program me with detailed 
projects will allow to mobilize support for these important act ivities. Lao PDR requests 
technical assistance from donors to elaborate such a program me to be included in its transition 
strategy.  
(iv) Support for participation of the capital officials in the United Nations and International 
Organizations including caps  on budget contributions and support for travel:  While the WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  amounts of money involved are not that important, this support is essential for Lao PDR to be 
able to fully participate in international organizations as appropriations within the national 
budget a re often difficult to obtain and require lengthy procedures. Lao PDR therefore intends 
to include the support for these activities into its transition strategy while it is intending to 
create, in the medium term, a special budgetary allocation for these ac tivities.  
(v) Lao PDR 's participation in international negotiations. The Government is aware that it will have 
to change its strategy in international negotiations in particular at the WTO and UNCTAD. From 
a policy of requesting exemptions and preferences for LDCs, Lao PDR will have to shift towards 
a pro -active policy to ensure that international framework and rules are conducive to its 
development rather than to ask for exemptions of rues not adapted to its development status. 
The Government has already s tarted this transition: (i) it participates in all plurilateral 
negotiations that are currently under way; (ii) it intends to join the ITA I and II Agreements 
still this year; (iv) it is implementing aggressively its commitment under the TFA and (iv) it 
has developed a pro -active and consensus -oriented negotiations strategy for WTO. However, 
Lao PDR does not have the negotiation capacity to implement a pro -active negotiation strategy 
in the various fields currently under negotiation. It needs a strengthenin g both of its presence 
in Geneva as well as of its negotiation capacity. Lao PDR requests from WTO Members urgent 
support to be able to play its role in WTO and UNCTAD. It intends to elaborate with interested 
parties a mid -term support program me to strengt hen its negotiation capacity to fully 
participate in international negotiations.  
3  LONGER TERM MEASURES  TO ENSURE LAO PDR 'S SUSTAINED DEVELOPM ENT 
3.1.  Short -term measures to ensure a smooth transition are necessary, but insufficient. Lao PDR 
has to address its st ructural issues to ensure sustainable and inclusive development. The issues 
which threaten the sustainable development of Lao PDR are well established: (i) structural change 
in the economy to reduce its dependence on capital intensive resource based develo pment towards 
a broader development pattern of inclusive and value added economy and (ii) the reduction of 
external vulnerability due to the heavy concentration of the export pallet as well as of the destination 
of its exports coupled with fiscal and curre nt account deficits, a limited foreign exchange reserve. 
The two constraints are interrelated and need longer term policies linked to a more favorable 
environment for the private sector and FDI, the acquisition of technology to improve its 
competitiveness,  the development of human resources to provide the necessary skills for an 
expanded production basis and a strong integration into regional and global value chains, given the 
relatively small internal market.  
3.2.  This said, Lao PDR has clear positive developme nts which should enable it to progress to its 
goal of a middle income country by 2030: (i) the Government has clearly identified measures to 
ensure the transition: it has an ambitious strategy to fulfill the SDG 2030 indicators;(ii) it is already 
implement ing the measures to address the impediments issues; (iii) given its low manufacturing 
basis, the opportunities to produce manufactured goods are improving, and (iv) Lao PDR is 
surrounded by fast growing markets and its current infrastructure investment is slowly transforming 
its landlocked status into a regional hub in the midst of an integrated vibrant market. Lao PDR 's 
sustainable development strategy will at the same time address the longer -term issues related to 
its graduation. The success of this strat egy is, therefore, vital.  
3.3.  The Government of Lao PDR therefore intends to integrate its graduation strategy into its 
sustainable development strategy by emphasizing the measures which will need to be implemented 
in priority. The Government intends then to integrate the two strategies into its 9th NEDP which will 
cover the graduation period from 2021 to 2025. For this purpose, the Government has identified the 
issues which will be crucial in the medium term to ensure the graduation and which can be 
implement ed in the planning period.  
3.1  Reducing Economic Vulnerability Index  
(i) Public finance issues: Lao PDR experiences persistently high fiscal deficits and relatively high 
public debt/GDP ratio. More than 80% of the public debt are in the foreign currency, mostly 
from bilateral aid sources. Given the expected reduction in foreign aid, graduation, in the 
longer term, will aggravate this situation. The Government is aware of the risks and fixed a 
goal of limiting the deficit to 2.5% of GDP and the debt to 55%  of GDP by 2022. Measures WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  already implemented have reduced the fiscal deficit to 4.3% and 4.1% (expected) in 2018 
and 2019 respectively, reversing a growing trend since 2015.  
The issues concerning the public debt includes: (i) moderate revenue growth while debt 
service payments has increased which amounted to about 11% of domestic revenue, 
increased a pressure on other spending program mes; (ii) shortfall in revenue collection, a 
high dependence on indirect taxes and on commodity prices. The Government intends to 
decrease its current expenditures while maintaining the required investments in health and 
education; increase its revenue basis and decrease its dependence on foreign financing. A 
specific plan to implement these policies will be a part of the transition strategy including a 
request for technical assistance from WTO Members . 
(ii)  Current account deficit : With a view to sustain macroeconomic stability and reduce external 
risks, the Government will implement measures to narrowing current account deficit through 
(i) the development of a larger productive basis and hence of its exports and (ii) improving 
indicators for ease of doing business to promote SME participation and inward FDI, which will 
in turn raise productivity and increase country 's cap acity for exports. (iii) Given the partial 
dollarization of the Lao PDR economy, careful exchange rate management will be conducted 
in order to maintain price stability. The ongoing BOL 's efforts to improve the functioning of 
the interbank market should he lp improve the foreign exchange management. To move 
forward in reducing dollarization, the BOL will strictly enforce Foreign Exchange Management 
Law, which requires all domestic transactions to be made in Lao kip, foreign exchange flows 
across borders rela ted to international trade and investment to be settled through banking 
system with an effort to enhance retail electronic payments and integration of its Real -time 
Gross Settlement (RTGS) with regional and global payment system.  
(iii) Safeguarding financ ial stability : The financial sector is largely occupied by banking system, 
which remains shallow in terms of service types. The recent improvements in legal regulatory 
framework, for instance, the amended Law on Commercial Banks are important steps to 
support the implementation of risk -based supervision, a prerequisite for transition towards 
Basel II standards. To continue strengthening financial sector resilience and deepening, 
sustained efforts will be needed in (i) updating prudential measures including the 
implementation and enforcement of existing regulations; (ii) improving management and 
profitability of few state -owned commercial banks; (iii) enhancing the soundness of non -bank 
financial institutions through modernization of regulatory and supervisor y tools.   
3.2  Structural change of the economy  
3.4.  Lao PDR 's sustainable development including the achievement of the  2030 Agenda, largely 
depends on its capability to transform capital -intensive, resource -based system into a more 
diversified economy based on val ue added production in the manufacturing and services sectors, 
thereby providing remunerative jobs for the young population. This will largely depend on the 
strengthening of the  private sector, its participation in regional and global value chains and its 
attractiveness for FDIs. Given its labo ur structure, including relative scarcity of qualified labo ur, 
Lao PDR could not follow a low labo ur cost development path as its neighbors have a comparative 
advantage in this filed. Its industrial policy has therefore to be based on higher value -added products 
and the integration of its productive structure into the large regional market. A broad -based 
development strategy will have to put emphasis on creating value added in the agricultural sector, 
given that  the large part of the population is still involved in therein. Accordingly, the Government 
has defined as its priorities in the manufacturing sector agri -businesses and transformation of its 
natural resources into value added processed products by encoura ging the forward and backward 
linkages of its economy. The Government intends to develop a WTO -consistent industrial policy to 
strengthen its manufacturing sector as part of its graduation strategy to be implemented during the 
9th NSEDP. Lao PDR has alread y started to work in this direction: the Prime Minister Order No.  05/PM, 
dated 21 May 2019 and Guidance No. 1610/MPI, dated 26 July 2019 were issued. TA is required for 
the preparation of the industrial plan and its implementation.  
3.2.1   Measures to Improve Ease  of Doing Business  
3.5.  To implement its industrial strategy Lao PDR will have to rely on domestic and foreign 
investment. The improvement of the regulatory framework for investments is of highest priority. WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  The promulgation of its new investment law was a first  step and has led to a sharp increase of FDI. 
However, most of the investments attracted so far have been capital intensive investment in natural 
resources and infrastructure. While Lao PDR overall legal framework is conducive to investments, its 
procedure s and its implementation of laws is still an impediment to investments as shown by its 
ranking in the World Bank 's index of ease of doing business (154 out of 180 countries in 2019). The 
World Bank index is particularly relevant for Lao PDR as it does not measure the legal framework, 
but is based on the effective experience of investors putting heavy emphasis on procedures.  
3.6.  The Government is aware of the issue and has commenced addressing it. The prime minister 
order regarding improving the effectiveness o f business registration and approval process in 
Lao PDR, promulgated in early 2019 , mandated all concerned agencies (including all Ministries, 
Agencies and provincial authorities) to review and simplify their procedures with the aim to improve 
the ranking of the Lao PDR in the World Bank index below 100.  
3.7.  For this purpose, the Government intends to concentrate on those indicators that can be 
improved in the short term and which have the greatest impact on its ranking, concentrating its 
reforms on the followi ng 7 categories: (i) Starting a business (concentrating on a streamlining of 
procedures, reducing the time required as well as the costs); (ii) Enforcing contracts (by reducing 
time of consideration and improving the quality of the judicial system, in part icular – through 
enhancing availability of alternative dispute settlement options (mediation and arbitration); 
adjusting the court structure and streamlining procedures as well as introducing court 
automatization; (iii) Issuance of  construction permits (b y reducing the number of procedural steps, 
the costs and the consideration time; (iv) Facilitating getting electricity (by reducing the number of 
procedures, the time required and the reliability of the services largely through automatization); 
(v) Resolvi ng insolvency (strengthening the insolvency mechanism); (vi) Protecting minority 
interests (by increasing director 's liability, shareholder governance and rights as well as corporate 
transparency); (vii) Streamlining procedures for paying taxes (by reducin g the number of payments 
(35) and the time required (365 hours) largely through automerization of the process and use of 
IT). 
3.8.  The Government intends to elaborate a concrete action plan to achieve its goal of ranking below 
100 in 2024 as part of its transit ion strategy of graduation and will identify concrete requests for 
technical assistance.  
3.2.2   The human capital index  
3.9.  The World Bank index of human capital for Lao PDR is 0.45 which means that a child born in 
Lao PDR will be only 45% productive compared to his/ her potential. The lack of trained workforce is 
a major impediment to the industrial policy which puts emphasis on higher value -added production 
as well as for the sustained development overall. Health and education thus of major importance in 
the Lao PDR 's 2030 Agenda. The graduation strategy should, thus, be integrated and supportive of 
this Agenda by concentrating on those aspects which are essential for the sustained economic 
development during and after graduation. The Government therefore has decided to put its emphasis 
in terms of health and education on the two elements which are the most constraining for the 
implementation of its graduation strategy based on a structural reform of its economy.  
(i)  In education , Lao PDR has made great progress in the en rollment in primary and lower 
secondary education. The major issue in education is its quality. The Government therefore 
will concentrate its efforts on quality teaching, curriculum reform in the primary school as well 
as on attendance. The adoption of a n ew curriculum is under  way with training of the teachers 
and support materials provided for grade 1. Grade 2 to 5 will follow.  
(ii)  In health,  Lao PDR has made substantial progress in basic indicators such as maternal health; 
under 5 mortality rate, adult survival rate etc. although it still has indicators which are below 
the averages in the region and further measures are foreseen in the 2030 A genda. For its 
graduation policy and the goal of diversifying its economy base, the most pressing issue is the 
rate of stunned children under the age of 5 this will severely impede the work force in the 
future. A program me addressing this will be an integr al part of the graduation strategy.  WT/TPR/G/394 • Lao People's Democratic Republic  
 
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  4  THE INSTITUTIONAL FR AMEWORK FOR THE GRAD UATION STRATEGY  
4.1  Introduction  
4.1.  To warrant that the measures needed to ensure a smooth transition and its sustainable 
development, in 2017, Lao PDR established the National Steering C ommittee for SDGs 
implementation under the Presidential Decree, chaired by the Prime Minister, deputy -chaired by 
Minister of Foreign Affairs and included members from all concerned ministries and agencies. There 
is also a mechanism allowing to engage the c ivil society to implement the 2030 Agenda, which covers 
many of the issue which have to also be addressed within the graduation process. To ensure 
consistency among various policies and to streamline policy formulation as well as monitoring and 
evaluation,  the Government intends to use this structure to determine and implement its graduation 
strategy. In addition, the Prime Minister issued the Decision on the establishment of the National 
Steering Committee for the Implementation of the United Nations ' program for the LDCs in 2018. 
This Committee consists of the representatives from relevant agencies and would be responsible for 
the implementation of the short -term and long -term measures of the graduation strategy and their 
embedment in the SDGs 2030 Agenda.  The working group would require urgent technical assistance 
for the elaboration of the graduation strategy as well as to strengthen the negotiation capacity of 
the International Department. UNESCAP is expected to continue its technical assistance to the 
Agenda 2030.  
4.2  The way forward  
4.2.1   Mobilization of resources  
4.2.  Lao PDR expects to receive during the TPRB meeting in November 2019 indications from the 
WTO Members on the type of assistance they are willing and able to provide Lao PDR with definition 
and implement ation of the graduation strategy. It will then – in the first half of the 2020 – elaborate, 
together with the interested donors, specific project requests to be submitted to the consultation 
meeting to be held with the WTO Secretariat to report on the resu lts of the review in Vientiane 
before the summer of 2020. It is expected that donors would make firm commitments at this 
consultation meeting.  
4.2.2   The elaboration of the graduation strategy  
4.3.  The Government intends to work out the basic elements of the graduation strategy in 2020, so 
that its main elements can be included into its 9th NSEDP (2021 to 2025). For this purpose the 
Government would encourage the Secretariat of the Committee for Development Policy (CDP) of the 
Economic and Social Council (ECOS OC), together with the UNCTAD, the WTO and the World Bank to 
submit the early and consolidated graduation assessment proposal for Lao PDR by mid -2020 and to 
detach an expert in spring 2020 to assist Lao PDR in the elaboration of the Graduation Strategy in 
time for Lao PDR to submit such Strategy for approval to the CDP for its meeting in 2021. The 
Government considers that implementation of the Graduation Strategy should start in the 2021 to 
2024 period, so that the Strategy can be adapted at the meeting of  the CDP in 2024, when Lao PDR 
is expected to officially graduate.  
4.2.3   Institutional and consultation mechanisms  
4.4.  Starting with the WTO Secretariat 's mission to discuss with stakeholders the results of the 
trade policy review, the Government will commence, wit h the assistance of the experts, a large -scale 
campaign of awareness raising among all stakeholders both at the central and provincial levels, 
including the private sector and the civil society. The Government considers this activity to be 
essential to ens ure full buy -in and implementation of the various measures required to ensure a 
smooth transition. The institutional framework and particular responsibilities of the various actors 
will be determined in time to be included into the 9th NSEDP.  
 
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