Laos is one of the world's poorest nations, and its primarily
agricultural economy functions almost completely at subsistence level.
The main crop is rice which is grown in various different types. Other
crops are cassava, fruits, groundnuts, pulses, maize, sugar
cane, tobacco and coffee. Laotian coffee, although little known outside the area,
is greatly rated amongst connoisseurs and is currently the
country’s single largest export product.
Laos has sufficient, though mostly untapped reserves of
tin, lead and zinc, including iron ore, coal and timber. Industry
processing raw materials, especially timber
and food while textiles and basic consumer goods are also produced.
Despite its relative ambiguity and peaceful nature, a tourism industry
evolved which is presently Laos’ single largest source of
income. Development is hampered by
a chronic lack of skilled labour and foreign exchange, and the Laotian economy depends a great deal on foreign aid (80% of public sector investment is financed by aid) particularly from Scandinavia, and Japan and more recently Taiwan, Thailand and Australia.
Economic reforms started in the early 1990s and included a large-scale privatization programme. These reforms initially gained the support of the IMF but failure to meet successive financial goals resulted in a withdrawal of the Fund's support in 1998. Combined with the regional financial crisis, the economy was in grave trouble by the beginning of 1999 with 100% yearly inflation, a collapsed currency value and a large shortage of domestic and foreign currency.
Since then a recovery has taken place: the economy is currently growing at around 6% yearly while inflation has dropped to a more manageable 25%. Nevertheless, the economic prospects are uncertain. Laos has membership in the Asian Development Bank and the Colombo Plan, which promotes social and economic development in Asia and the Pacific.
Punctuality is advised and appreciated. A businessman should wear lightweight suits, shirt and tie. All officials do not speak English and knowledge of French
will be helpful. A Laotian translation should be added on the back of business cards. The dry season, from November
April is the best time to visit Laos.
Office hours: Mon-Fri 8.00 am - 12.00
pm and 1.30 -5.30 pm.
The following organizations can provide advice:
Lao National Chamber of Commerce and Industry, BP 4596, Sihom Road,
Ban Haisok, Vientiane (tel/fax: (21) 219 223; e-mail: email@example.com)
Ministry of Finance, Luang Prabang Road, Ban Phonxang, Vientiane
(tel: (21) 412 401; fax: 412 415).