Economic co-operation seen as main pillar of comprehensive ties with Laos

According to the Ministry of Planning and Investment of Vietnam (MoPI), investment links between both sides have enjoyed steady growth over recent times. Indeed, Laos always ranks first among the leading 78 countries and territories which Vietnam invests abroad in, with a total of 209 projects totally capitazed at US$5.1 billion, while the nation ranks third among foreign investors in Laos.

Investment opportunities in Laos

Following a period of decline, Vietnamese investment in the neighbouring country is increasing again in a more sustainable manner, with last year’s investment capital from the nation to Laos reaching US$118.3 million, representing an annual rise of 33.3%

Most notably, a number of effective investment projects run by local enterprises in Laos have continued to increase their investment capital this year. According to estimates, the contribution of tax and other financial obligations of Vietnamese enterprises to the Laotian Government over the past five years has reached more than US$1 billion.

Regarding investment co-operation between the two countries over recent years, Minister of Planning and Investment Nguyen Chi Dung said that many investment projects of Vietnamese enterprises in Laos have operated effectively and have duly made positive contributions to socio-economic development there. This has served to create jobs and raising incomes for thousands of employees, a move which has also supplemented revenue for the Laotian state budget, especially projects on energy, telecommunications, banking, rubber plantation and processing, food production and processing.

However, in order to make further progress moving forward, the two sides must focus on prioritising the implementation of goals set out in the Vietnam - Laos co-operation plan in 2022, the Minister said.

It is therefore necessary to create the best investment environment possible whilst speeding up Vietnamese investment projects in Laos in the most substantive and most effective way possible in the time to come as a means of bringing efficiency to both nations.

Greater efforts needed to iron out snags

According to economic planners, financial and monetary issues, traffic connection and legal system represent difficult barriers which mean firms from the two countries lack investment opportunities.

Therefore, the main focus should be on exchanging and evaluating the results achieved in investment attraction, as well as dealing with difficulties and recent problems. The two sides should seek to further intensify investment and business activities in order to complement and take advantage of each other's opportunities, whilst jointly seeking opportunities and overcoming challenges.

Lao Minister of Planning and Investment Khamjane Vongphosy said that despite facing numerous difficulties, Vietnamese enterprises and groups conducting business and investing in Laos have continued to make great efforts and have a high determination to make direct contributions to the cause of national construction and defence.

As a means of helping businesses to run their investments smoothly, competent Laotian agencies will review and create conditions for guidelines and policies to be open, stable, and attractive, thereby helping Vietnamese businesses feel more secure to invest and operate in this market.

Over the past two years, the Laotian Government has paid close attention to improving the local business investment environment, seeking to solve pending problems, creating open and transparent mechanisms and policies, whilst encouraging transparent investment aimed at creating competition and attract more investors, the Laotian minister continued.

According to Minister Khamjane, moving forward the Laotian Ministry of Planning and Investment will continue to consider removing obstacles in processes and procedures in order to create the most open and transparent investment environment possible.

He also expressed his hope that Vietnam would continue to facilitate mechanisms for Lao enterprises to do business in the Vietnamese market.

Giving a boost to investment co-operation

In order to further promote investment co-operation between the two countries in the time ahead, the two sides have been making efforts to devise solutions, such as ensuring the maintenance of macroeconomic stability and creating a stable and transparent legal corridor. This is being done while building a favourable business environment and focusing on solving difficulties and obstacles of a number of big projects.

The two sides have also actively ramped up international co-operation and utilised external resources for development and effective co-operation within the framework of ASEAN, the Regional Comprehensive Economic Partnership (RCEP) Agreement, and the World Trade Organization (WTO).

They need to have a specific set of mechanisms for a number of key strategic projects which serves as a leverage in economic co-operation between the two countries.

This year has seen both sides agree to continue creating favourable conditions for Vietnamese businesses with financial potential and expertise to invest in clean agriculture, manufacturing and processing industries in Laos, thereby contributing to  consolidating the growing special relationship between the two nations.