Lao Economy

Govt To Pursue 7 Percent Economic Growth In 2018

Source: Vientiane Times

The government expects to pursue economic growth to at least seven percent in 2018, the same level expected for 2017, according to the Ministry of Finance.

The ministry is drafting the budget plan for 2018, which will be submitted to the upcoming ordinary session of the National Assembly (NA), scheduled to take place in October for debate and approval.

To attain the expected target, the ministry eyes collecting a total revenue of 26,618 billion kip (18.72 percent of the GDP), an increase from the 23,941 billion kip expected for 2017.

Deputy Prime Minister and Minister of Finance SomdyDuangdy issued an instruction recently to guide the drafting of the budget plan, which sets the revenue and expenditure targets.

The expected 26,618 billion kip target includes grant aid, according to the ministry.

Of the total revenue target, domestic revenue is set to reach no less than 23,028 billion kip, an increase from 21,463 billion kip is expected for 2017.

Expenditure for 2018 is expected to reach 33,320 billion kip (23.43 percent of the GDP), an increase from 32,402 billion kip set for 2017.

The budget deficit for 2018 is set at only 6,702 billion kip, a decrease from 8,461 billion kip of the 2017 budget plan.

According to the instructions, expenditure for 2018 will attach great importance to exercising frugal spending in line with the Prime Ministerial Order No 9 issued in May 2017 on frugal expenditure of state budget.

The authorities in charge were told to prioritise expenditures for salaries and supporting allowances for civil servants, while ensuring that expenditure is based on real figures to avoid duplicate spending in any case.

The 2018 budget plan is aimed at stabilising the macro economy and national budget, with the government pledging to take action to prevent accumulating new debts, while disbursing and minimising the existing chromic debts, according to the ministry.

Inflation rates are set to be no higher than 5 percent to ensure the exchange rate remains at a manageable level.

The 2018 expenditure plan is based on the revenue collection capability and priorities of each sector in order to ensure the most effective use of the budget, in line with the Prime Minister Decree on Frugality against Lavishness and the Prime Ministerial Order on Frugality of the State Budget.