The Lao government will introduce strict measures to regulate the import of consumer goods and bolster domestic production, in an attempt to reduce imports and cut capital flow to other countries.

A surge in both legally and illegal imported goods from neighbouring countries means Lao producers are struggling to compete in terms of price and production, Deputy Minister of Industry and Commerce Somchith Inthamith told media during an interview last week.

The increase in imports is also driving up the exchange rate of foreign currencies against the kip, especially the Thai baht, he said.

In response, the government has set up a taskforce committee to regulate the import of consumer goods and promote the production and purchase of Lao-made products.

This taskforce is headed by Deputy Prime Minister and Minister of Finance Somdy Duangdy with Somchith as the deputy head. Its members comprise representatives from relevant government bodies.

In an attempt to regulate imports, the committee will coordinate with Vientiane authorities to strictly inspect imported products according to Lao regulations, using technology and licence certification when making checks at border crossings.

Every day numerous trucks bring in consumer goods from Thailand to Laos, mostly into Vientiane via the Lao-Thai Friendship Bridge, but these trucks do not always have import licences, Somchith said.

“We need to determine what kind of products we should limit and those whose import is essential. We can’t ban imports altogether but we can use the regulations we have to bring the situation under control,” he said.

Lao regulations are an important tool in regulating importers and preventing illegal imports.

Illegal imports are one reason why Lao farmers are reluctant to grow crops, combined with the fact that Laos is a small market and a large amount of investment capital is required.

“We will invite import companies to meet with Lao producers to discuss ways to cooperate in trading, in order to cut back on imports,” said Somchith.

With regard to promotion, the committee will focus on organic and clean agriculture groups because these products have little competition.

“For promotion, we will go to places that are conducive to high rates of productivity and good quality and try to find markets for them,” he said.

To support the promotion effort, the government will use funding intended to support food security and commercial production, as well as enter into collaborative projects both in Laos and abroad.

To begin with, the initiative will be rolled out in Vientiane and will then be introduced in other areas if it is successful.

The committee consists of three divisions – a promotion unit, compliance and inspection unit, and a press secretariat.

VIENTIANE TIMES/ASIA NEWS NETWORK