Laos 20240724: Cultural, Historical, Culinary
Mekong Memo Laos Weekly: Business, politics, finance, trade & legal news.
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Headlines:
Economic Lifelines Deployed as Kip Woes Persist
New Rail Links For SEA Trade and Tourism
Singapore Power Deal Hits Transmission Snag
Digital Platforms Face VAT Hike
International Ties: CN, VN, KH, LU, US
Farmers Pressured as New Ag Vision Takes Shape
Tourism Banks on Skills and Open Borders
VietJet Plans Take Flight
Mekong-Lancang Cooperation Gets Cash Boost
Vientiane Hosts High-Stakes Diplomatic Summit
Lao-Texan Fusion Sizzles in Fort Worth
Economic Lifelines Deployed as Kip Woes Persist
The government is making moves to stave off economic collapse, continuing to zero-in on inflation, currency weakness, and rising costs. President Thongloun Sisoulith continues to beat the drum on the desperate need to address public and foreign debt. The recent removal of the head of the central bank is an indication of the depth of ongoing forex challenges and problems related to an increased reliance on China for financial stability. The nation's debt has reached $13.8 billion, or 108% of GDP and officials are working to meet economic targets and development goals, with regular monitoring to keep stability and growth in line.
Read more: The Star (Economic Measures), Nikkei Asia (Central Bank Shake-Up), ABC News (Debt), DW (Debt)
New Rail Links For SEA Trade and Tourism
The new Bangkok-Vientiane passenger train service has launched, once again improving Southeast Asian connectivity in travel between Thailand, Laos, and China. The 12-hour journey includes efficient customs checks and links with the China-Laos Railway. Thailand's expanded rail network, including the ASEAN Express, is expected to boost trade with both China and Laso. The first journey reportedly served 500 passengers, well in excess of an expected 200.
Read more: Nation Thailand (Passenger Train), Nikkei Asia (Trade Expansion), VN Express (Details)
Singapore Power Deal Hits Transmission Snag
The extension of Singapore's agreement to import hydropower is hitting a wall due to disputes over energy transmission through Malaysia and Thailand. The Lao PDR-Thailand-Malaysia-Singapore Project, signed in 2022, was supposed to supply up to 100 MW of electricity, but disagreements on power purchase quantities and fixed costs are throwing a wrench in the renewal process, with Thailand's internal issues further muddying the waters.
Read more: Reuters
Digital Platforms Face VAT Hike
Starting August 1, the government is hiking the value-added tax on digital platforms like Google, Facebook, and Amazon from 7% to 10%. Users are being told to update their Tax Identification Number on these platforms. The VAT increase is also hitting imports, goods, services, and electricity usage as the taxman looks to boost state revenue and support economic development while the country battles ongoing inflation and currency depreciation.
Read more: The Star
International Ties: CN, VN, KH, LU, US
The region is seeing a flurry of diplomatic activity. An MoU with China's Asia Tobacco Industry Group is targeting agriculture and forestry development to boost food security. Cooperation with Vietnam and Cambodia is an exercise in regional solidarity. A new agreement with Luxembourg is focusing on international law enforcement and human rights. Meanwhile, U.S. Secretary of State Antony Blinken is making the rounds in Southeast Asia, aiming to shore up American alliances and discuss regional security and cooperation.
Read more: The Star (China), SGGP (Regional Cooperation), VietnamPlus (Luxembourg), The Diplomat (US)
Farmers Pressured as New Ag Vision Takes Shape
Farmers in Laos are facing rising production costs, unauthorized imports, and market instability. Vientiane Vice Mayor Sirilaththongsin Thongpheng called for government intervention to curb illegal imports and regulate prices to protect local farmers. At the same time, the Lao Ministry of Agriculture and Forestry has partnered with Asia Tobacco Industry Group (see previous article) for a feasibility study to improve food security and agricultural output. Plans include modernizing farming practices, building processing plants, and improving marketing strategies to ensure sufficient domestic supply and boost exports.
Read more: The Star (Farmers' Concerns), Xinhua (Government Initiatives)
Tourism Banks on Skills and Open Borders
Tour guides are hitting the books as part of a nationwide push to polish the tourism experience with a new government training program. Thailand, Laos, and Malaysia are implementing visa relaxation policies to attract more tourists to the entire region, an effort that seems to be drawing more visitors across the board. Laos has expanded visa waivers to eight European countries and multiple-entry visas for 22 nations.
Read more: Mangalorean (Guide Training), VnExpress (Regional Visa Policies)
VietJet Plans Take Flight
VietJet has inked a new deal with the Lao government to expand air connectivity, boost tourism, and drive economic and social development. The main thrust of the deal includes creation of up to 2,500 aviation jobs, a new Maintenance Repair Overhaul (MRO) facility, and the introduction of a VietJet Aviation Academy in Laos. The agreement also supports trade and cultural exchanges between Vietnam and Laos.
Read more: AeroTime
Mekong-Lancang Cooperation Gets Cash Boost
Laos and China have signed a new agreement under the Mekong-Lancang Cooperation (MLC) scheme, adding ten projects worth $2.6 million this year. These projects are centered on agriculture, environmental protection, water management, public health, trade, industrial capacity, human resource development, and tourism. Established in 2016, the MLC initiative is intended to grow socio-economic development and multilateral cooperation between member countries.
Read more: The Star
Vientiane Hosts High-Stakes Diplomatic Summit
The capital is bracing for a geopolitical show as top diplomats from China, the US, and ASEAN converge. With thorny issues like the South China Sea dispute on the table, the three-day meeting might offer some moments of high drama. As regional tensions simmer, all eyes are on this test of diplomatic mettle. US Secretary of State Antony Blinken and Chinese Foreign Minister Wang Yi will attend the three-day meeting, aiming to address tensions and promote adherence to international law. The gathering comes as China's assertiveness and its impact on regional stability continue to be issues to watch.
Read more: Manila Standard
And now for something completely different.
While the focus of The Memo is on news for business, we often wrap with a less business-focused article. If history and archaeology are your thing, read about a discovery of ancient bones found in Laos that might rewrite our understanding of human migration. Otherwise, we loved to read about this bit of Southeast Asia making waves in the Lone Star State:
Lao-Texan Fusion Sizzles in Fort Worth
In a delicious twist of culinary fate, Lao flavors are spicing up the Texas BBQ scene. Goldee's BBQ co-owner Nupohn Inthanousay's journey from hesitation to celebration is an inspirational demonstration of the power of cultural fusion. His smoked Lao sausage and sticky rice are more than menu items – they're a bridge between his cultural traditions, leaving Fort Worth's BBQ lovers hungry for more. Encouraged by fellow owners and positive community response, Inthanousay is going on to offer more Lao dishes like laab and mango sticky rice to an intrigued American clientele.
Read more: Star-Telegram
That’s all for this week, thanks for reading.
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