Cooperation and Investment in Agro-Forestry Sector



Agriculture : The economic growth of the Lao PDR Depends to a large extend, upon the, performance of the Agricultural sector which contributed in 1993 for 56% of the GDP and employed about 0% of the labor force.

Coffee is by far the most promising product for export. In 1992, export of coffee accounted for around 80% of the export value in the agricultural sector and contributed for 7.4% of the total export value of the country. Export also includes several annual and perennial corps of limited quantities.

The Lao PDR has the highest potential land/person in the Greater Mekong Subregion large and unexploited fertile land and favorable climatic conditions, particularly in the boloven basaltic plateau. This could offer promising opportunities for low-intensive investment in the agro-processing industry for export based on annual and perennial crops.

The on-going improvement of main National Roads linking major provinces, together with the high rate of urbanization have created favorable conditions for investment in the import-substitution agro-processing industries.

Forestry : It has been estimated that the Lao PDR has the highest ratio of forest to total area in ASIA. Wood products including lumber are one of the main export earning of Lao PDR. In 1993, it accounted for 22% of the total export value. In view of the long term sustainable development and the preservation of the environment, the Government has been implementing the policy of striking a balance between exploitation and conservation and shifting from exports of logs and lumbers towards the promotion of wood processing. Due to shortage of capital and the technical know-how in the country, the development of wood processing subsector also needs the investment and the introduction of new technology of the foreign investors.