Laos 20231018

Mekong Memo Laos Weekly, October 18, 2023: Business, politics, finance, trade & legal news.

Oct 18, 2023

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Here is your Mekong Memo Laos for the week of October 18, 2023:

Headlines:

Leading ASEAN Through Myanmar's Crisis

Curbing Luxury with Excise Tax Hike

Japan Forges Ahead with Renewed Ties

China's Infrastructure: Boon or Bane?

Asia's Dark Underbelly: The Trillion-Dollar Betting Menace

Prioritizing Civil Servants in Face of Rising Costs

Action Plan for a Stable Monetary Future

Economic Hurdles Lead to Credit Rating Downgrade

Capital Market's Vision for Economic Revival

Labor Shortage Stifles Business Progress

Amplifying Trade Ties with Singapore

Revolutionizing Regional Trade with Cold Storage

Leading ASEAN Through Myanmar's Crisis

As Laos assumes the ASEAN Chairmanship in 2024, its leadership in addressing the Myanmar crisis is under scrutiny. Lao Prime Minister Sonexay Siphandone has focused on emphasizing ASEAN unity and regional peace. Laos faces the challenge of balancing diverse ASEAN interests and addressing Myanmar's situation, especially with its ties to regional powers like China and Russia. Leveraging these relationships, Laos could push for the implementation of the ASEAN Five-Point Consensus, press to reduce arms transfers to Myanmar, and facilitate humanitarian aid. Collaborative efforts with Indonesia, the UN, and a long-term approach will be crucial for Laos' success.

Curbing Luxury with Excise Tax Hike

To mitigate the outflow of foreign currency, Lao President Thongloun Sisoulith has decreed a rise in excise tax on specific goods, targeting luxury imports. The Presidential Decree issued on October 9, 2023 adjusts the excise tax rates based on product categories, including fuel-powered vehicles, alcoholic beverages, tobacco, soft drinks, and licensed gambling equipment. For instance, vehicles' tax rates now range from 31% to 220% based on engine capacity, and alcoholic beverages see hikes up to 110% depending on alcohol content.

Japan Forges Ahead with Renewed Ties

In a recent meeting between Japan's Foreign Minister Kamikawa Yoko and Laos' Deputy Prime Minister and Foreign Affairs Minister, Mr. Saleumxay Kommasith, both nations emphasized their commitment to deepening bilateral relations. Minister Kamikawa highlighted Japan's support for Laos' socioeconomic development, including legal system enhancement, connectivity, and financial stabilization. Both leaders expressed eagerness to expand cooperation in areas like climate change and clean energy. As Laos prepares for its ASEAN chairmanship and the 70th anniversary of diplomatic relations with Japan in 2025, the two countries anticipate a strengthened strategic partnership.

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