Laos has been referred to by some as “the potential Switzerland of South East Asia” - and while this is a little ambitious, it can still be argued that the country is punching above its weight. There is definite consensus in the Laos Government for the economy to develop into a South East Asia power house and rival their neighbours.Chris Scott, Claridon Group Ltd
The Lao PDR (Laos) is a relatively unknown economy to the EU, and there may be several reasons for this. It’s rarely, if ever, in the news - probably because there are no big stories that make the headlines. It doesn’t experience national disasters. It isn’t involved in conflicts with its neighbours. It is a politically and religiously stable country. It has a progressive and moderate government, a stable economy, a modern and efficient banking system and a GDP which has been stable at around 7% for the past 15 years.
Until now, the Lao have just quietly been getting on with their business, trading mainly with their South East Asia neighbours. The good news for the UK is that this is now changing and the Lao are looking outside their traditional trading partners to boost their economy. This could bring lucrative opportunities for British business in a wide range of sectors. The recent visit to the UK by the Lao National Chamber of Commerce & Industry, accompanied by the largest business delegation ever to set foot on our shores, is a clear indication of the interest and intention to do business with British firms.
Laos has been referred to by some as “the potential Switzerland of South East Asia” - and while this is a little ambitious, it can still be argued that the country is punching above its weight. There is definite consensus in the Laos Government for the economy to develop into a South East Asia power house and rival their neighbours.
Laos is a landlocked country and it is relatively similar in size to the UK in terms of land mass and its population is roughly the size of Sweden. The country shares its borders with China to the North, Vietnam to the East, Cambodia to the South, Thailand to the West and Myanmar to the Northwest; as such, the Lao Government intends to develop Laos into a “hub” of South East Asia. Laos is one of the ten members of ASEAN, which has a combined population of ¾ of a billion and is 1.5 times the size of the EU and about half the size of China. The jewel in ASEAN’s crown, Laos will chair ASEAN in 2016 and is playing an ever-increasing role within the ASEAN community.
Laos is generally mountainous with deep valleys and many rivers, which flow into the mighty Mekong. It is incredibly rich in water resources, having around 33% of the water supply of Indo-China with just three per cent of the population. Its hydro-electricity is the country's most important source of renewable energy and accounts for a large proportion of its exports. The abundance of low cost electricity, coupled with a low cost base work force, is attracting multinational organisations from industries that are heavily reliant on electricity. Other natural resources in abundance include copper, tin and gold, and the country's business sectors, namely construction, forestry, food processing, garment manufacturing, cement and tourism are growing at a rapid pace. The beauty of Lao attracts tourists from across the world, many of them exploring some of the country's most remote locations.
The re-established Laos Embassy opened in London in November 2014 after a 29 year absence, with the historic event completing the full diplomatic representation of all ASEAN member states in the UK. British goods, services and expertise are much sought after in Laos and the “Made in Britain” label is held in very high esteem. The Government of Laos are actively encouraging British businesses to look at their country as an exciting new export market, to establish a presence for their products as well as encouraging investment opportunities for infrastructure and other major sustainable projects.
With many exporters focused on the economies that border Laos, they could well be missing out on establishing their brands in this exciting and emerging new economy.