Lao PDR

THE PROPOSAL

The Government of Lao PDR has an agricultural development strategy for 2025, seeking a 2.5% agricultural sector growth to improve nutrition, production and secure access to domestic, regional and international markets. The Government is working to enhance coordination between the agriculture and industrial sectors, zone agricultural land for food production and industrialization, improve irrigation and infrastructure for post-harvest management of products. 

The Hand-in-Hand Initiative supports investments in several agro-industries located along the Lao-China railway. Named the "Designated Green Corridor," the area has high and medium agricultural potential and provides opportunities to boost international agriculture trade.

COMMODITIES AND INTERVENTIONS

Cassava

The Government has prioritized production of cassava, whose exports to China could generate as much as US$214 million annually. It is also vitamin-rich food for people and a key source of animal feed.

The Government's strategies include boosting primary production of cassava through contract farming and productive alliances, improving primary and secondary processing, quality compliance and logistics, and finally supporting the development of climate-smart technologies and digital platforms.

An investment of US$100 million could benefit 200,000 people, including income increase of US$500 per capita. The internal rate of return ranges between 15 and 20%.

COMMODITIES AND INTERVENTIONS

Livestock

The Government has selected livestock value chain as a priority since 52% of households keep cattle. Additionally, animal exports accounted for 21% of agri-exports in 2021. Domestic supply meets only 49% of the demand, and there is demand coming from China and Thailand that is not met.

Strategies on this front include improving breeding, beefing up support to large animal farming enterprises, enhancing productivity and quality, and building resilience against climate change. The Government also works to improve feed, livestock protection, livestock SMEs and commercial cattle farms, processing facilities, extension services, transport, logistics, and cold chains.

It is estimated that US$95 million of investment would benefit 150,000 people, with US$600 income increase per capita. The internal rate of return is estimated to be between 16 and 25%. 

COMMODITIES AND INTERVENTIONS

Tea

As part of an effort to promote exports, the Government is considering tea as an export commodity in the north, where 83% of tea (16,000 mt) is grown in the Phongsaly and Luang Namtha provinces. Tea has tremendous potential for expansion, with 2.4 million suitable hectares of land. Tea from Lao PDR is also organic and has a high export value.

To this end, the Government's interventions have included developing contracts and land concessions, adopting climate-smart production systems, modernizing processing technologies and improving export logistics infrastructure.

An investment of US$45.6 million could benefit 100,000 people, with per capita income increase of US$400. The internal rate of return is estimated to be between 20 and 25%.