Laos Economic Outlook
April 26, 2022
Activity was likely robust in Q1. Year-on-year export growth picked up compared to Q4, according to Ministry of Commerce figures. Despite being held up by China’s zero-Covid policy, the China-Laos railway appears to have boosted freight between the two countries. Moreover, Covid-19 restrictions were loosened in January–February. That said, rising energy prices caused the oil-related import bill to swell and inflation to hit a near-decade high in March, likely denting consumer spending. Meanwhile, the government presented its five-year budget in late March, proposing a gradual shrinking of the fiscal deficit. Turning to Q2, activity is likely to be restrained: a Covid-19 surge forced the government to tighten restrictions from late March and a slowdown in China will hit exports. More positively, a major Covid-19 vaccine booster shot rollout recently began, which should support activity going forward.Laos Economic Growth
Activity should pick-up in 2022, with the China-Laos railway—once initial hitches are ironed out—boosting tourism and goods exports. Meanwhile, recovering global demand should further propel activity. However, a possible worsening of the public health situation, the elevated external debt burden, rising inflation and currency depreciation are key downside risks. FocusEconomics Consensus Forecast panelists project GDP to expand 4.6% in 2022, which is down 0.2 percentage points from last month’s forecast, and 4.9% in 2023.Laos Economy Data
| 2015 | 2016 | 2017 | 2018 | 2019 | |
|---|---|---|---|---|---|
| Population (million) | 6.7 | 6.8 | 7.0 | 7.1 | 7.2 |
| GDP per capita (USD) | 2,135 | 2,309 | 2,424 | 2,542 | 2,527 |
| GDP (USD bn) | 14.4 | 15.8 | 16.9 | 18.0 | 18.1 |
| Economic Growth (GDP, annual variation in %) | 7.3 | 7.0 | 6.9 | 6.3 | 4.8 |
| Fiscal Balance (% of GDP) | -5.6 | -5.1 | -5.5 | -4.7 | -5.2 |
| Public Debt (% of GDP) | 53.1 | 54.2 | 55.8 | 57.4 | 60.6 |
| Inflation Rate (CPI, annual variation in %) | 1.3 | 1.6 | 0.8 | 2.0 | 3.3 |
| Policy Interest Rate (%) | 5.63 | 5.31 | 5.00 | 5.00 | - |
| Exchange Rate (vs USD) | 8,122 | 8,161 | 8,196 | 8,313 | 8,561 |
| Exchange Rate (vs USD, aop) | 8,135 | 8,133 | 8,254 | 8,415 | 8,714 |
| Current Account (% of GDP) | -15.8 | -8.8 | -7.5 | -8.0 | -4.7 |
| Current Account Balance (USD bn) | -2.3 | -1.4 | -1.3 | -1.4 | -0.9 |
| Trade Balance (USD billion) | -2.0 | -1.1 | -0.8 | -0.9 | -0.5 |
| Exports (USD billion) | 3.7 | 4.2 | 4.9 | 5.3 | 5.8 |
| Imports (USD billion) | 5.7 | 5.4 | 5.7 | 6.2 | 6.3 |
| Exports (annual variation in %) | 11.5 | 16.2 | 14.8 | 8.7 | 8.9 |
| Imports (annual variation in %) | 14.1 | -5.3 | 5.5 | 8.8 | 1.4 |
| International Reserves (USD) | 1.1 | 0.9 | 1.1 | 0.9 | 1.1 |
| External Debt (% of GDP) | 80.9 | 85.6 | 86.9 | 86.8 | - |
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Laos Facts
| Value | Change | Date | |
|---|---|---|---|
| Exchange Rate | 8,885 | 0.31 % | Jan 01 |
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