Logo of Phnom Penh Post newspaper Phnom Penh Post - Special economic zones attracts over $5B in Laos

Special economic zones attracts over $5B in Laos

Special economic zones attracts over $5B in Laos

Twelve special economic zones (SEZs) established across Laos have attracted investment of almost $5.7 billion and created thousands of jobs for local people, a report this week showed.

The zones’ developers have invested $4.28 billion, individual companies invested $1.36 billion, and the Lao government has underwritten the remaining more than $52 million.

The number of zones increased from 10 in the 2013-2014 fiscal year to 12 in 2018, with an estimated total investment of $43.77 billion and registered capital of $14.30 billion.

As of 2018, the zones had attracted actual investment capital of almost $5.7 billion, according to a report presented at the second meeting of the Party Committee of the SEZ Promotion and Management Office on Monday.

Some 806 companies have invested in the zones comprising 26.34 per cent in the industrial sector, 25.26 per cent in trade, and 48.4 per cent in the services sector, Party Secretary of the SEZ Promotion and Management Office, Champa Khamsouksai told the meeting.

Manufactured goods exported from the zones were worth $1.75 billion as of 2018. In addition, the zones have contributed more than 349 billion kip in the form of various taxes and fees to the state budget.

The zones have created 55,771 jobs, including 12,596 positions for Lao workers.

In total, some 29,489ha of land have been granted for the development of the 12 SEZs following signed contracts.

However, just 14,960ha have been handed over so far including 11,678ha whose owners have been compensated for the loss of their land.

Authorities are currently studying the establishment of another special economic zone called ‘Smart & Eco-City’ straddling Luang Namtha and Oudomxay provinces with site surveys already undertaken.

Champa pledged the Party Committee of the SEZ Promotion and Management Office would push to improve the administration of the zones including a one-stop service to better facilitate investment and business operations as part of its five-year 2019-2024 work plan. Such efforts would expedite services in a transparent manner, he told the meeting.

He underlined the need to attach greater importance to labour management at the zones and to creating community-based projects to enable nearby residents to participate and benefit from the zones.

The Party Committee will lead efforts to draw up a SEZ strategic development plan for 2021-2030 to replace the 2011-2020 plan.

In addition, the Party Committee will work with relevant sectors to explore untapped potential associated with the Belt and Road Initiative and the under-construction Laos-China railway. New development zones or new special economic zones could be established in this regard.

The committee will continue to assess and follow up the development of the existing SEZs to ensure their effectiveness and maximise revenue collection along with compensating the remaining affected landholders.

VIENTIANE TIMES/ASIA NEWS NETWORK

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