Looking Back: 2022
In 2022, while Laos faced the pandemic’s economic consequences, the Lao Government reinforced key elements of its economic strategy, and hinted that the pandemic had encouraged a shift in its economic emphasis. The Government released various legal and regulatory issuances to enhance the socio-economic status of the country. 2022 saw the issuance of (i) the Notice on Modifying the Country's Minimum Monthly Wage; (ii) the Decision on the Exchange Services of Commercial Banks and Representative Exchange Shops; and (iii) the Decree on Technology Account.
In addition, the Government has also collaborated with the private sector to promote and develop a tax payment system through the M-Money mobile phone system in order to strengthen the country's digital economy, reducing the use of cash in the collection of tax revenues and the expenditures of the Ministry of Finance ("MOF").
The Bank of Lao PDR ("BOL") also issued a notice to BOL's authorities in all departments nationwide, public commercial banks, joint commercial banks, private banks and branches of foreign commercial banks to announce the implementation of the Amended Law on Foreign Exchange Management in their respective work fields.
Gazing Into: 2023
The position of Lao PDR as a landlocked country has prompted the Government to turn the country into a "land-linked" nation. This is achieved by the introduction of significant rail infrastructure and routes connecting Lao PDR to southwest China, as well as Vietnam and Thailand. Consequently, light manufacturing zones are springing up and the tourism industry is booming.
In order to make the currency exchange service effective and balance the demand and the supply of foreign currencies in the country, BOL issued the Decision on Currency Exchange Services to set out the principles and regulations relating to currency exchange services of commercial banks, which aims to foster the ability to adapt to the economic situation in each period and help in maintaining the stability of the national currency.
With the strong growth and development of digital technologies such as big data, the development of digital government, digital economy and digital society, Lao PDR also intends to strengthen and promote its digital system with the recent publication of the Draft Amendment of the Law on Electronic Transactions in the Official Gazette for public comments.
In addition, the following key trends and/or developments are to be noted:
- With inflation surging to 34% in Lao PDR, many households are struggling to pay for their basic necessities, and some government employees are taking second jobs or quitting their government jobs to earn more in the private sector. Amidst this development, the Lao Government has issued regulations from time to time to control inflation and stabilise and centralise the national currency;
- The Lao Government has announced a full reopening of tourism, allowing persons to enter the country without the need to test for COVID-19, in accordance with Notice of Prime Minister’s Office No.1914/PMO dated 23 December 2022 ("Notice"). The Notice eliminates the requirements to: (i) present vaccination certificates when entering the country; and (ii) test for COVID-19 with a rapid test kit (i.e ATK or Antigen Test Kit) within 48 hours before leaving the country of origin for Lao citizens, foreigners, and stateless persons who will travel to Lao PDR; and
- Deputy Prime Minister Sonexay Siphandone has been elected as the new Prime Minister, succeeding Phankham Viphavanh. Sonexay, the 9th Prime Minister of Lao PDR, garnered the most votes at the 4th Ordinary Session of the National Assembly.
Full Report
Click on the link below for the full report which provides summaries of the key legal developments related to the above areas.
