Laos 20250101: Poignant, Ostentatious, Propulsive
Get the latest Southeast Asian business news delivered to your inbox every weekday.
Choose to receive our daily editions covering Cambodia, Myanmar, Laos, Vietnam, and Thailand individually or together: account settings.
The Memo is published each weekday for the country of your choice. Paid subscriptions receive full editions while free subscribers get top headlines and an abbreviated selection of stories.
Support us and unlock unlimited access by becoming a paid subscriber today to stay informed on emerging opportunities in Southeast Asia with just a few minutes a day.
The Mekong Memo is proudly presented by:
Horton International is your premier partner for executive search in Southeast Asia. Whether you're a small startup or a global corporation, our reliable and effective recruiting solutions are tailored to meet your unique needs. With extensive experience and offices across the region, we excel at overcoming recruitment challenges and securing top talent for your organization.
Click here to learn how Horton can make your life easier.
Headlines:
China-Laos Railway Success Story
Vientiane in Ambitious New Bus Transit Project
Laos-Vietnam Trade Ties Stay Tough
New Mekong Dam Raises Cross-Border Concerns
Wage Implementation a Struggle to Get Right
Laos Sets Goal of Economic Self-Reliance
Mekong Commission Launches Digital Tools
South Korea Backs Lao Infrastructure
Debt Crisis Hangs Over Laos
Major Solar Project in the Works
Mekong Security Cooperation Gets Muscle
Vientiane Posts Strong Growth
China-Laos Railway Success Story
The China-Laos Railway is going into its fourth year with passenger traffic growing from 1,000 to 15,000 daily trips. Total passenger trips reached 42.92 million, with the Lao section handling 7.41 million passengers and 10.74 million tons of cargo. The railway has expanded cargo variety from 10 to over 2,700 types, created 100,000 jobs in Laos, and reduced transit time from Kunming to Vientiane from three days to one. Integration with regional networks including Thailand and Malaysia's services suggests that the impact of the improved connectivity continues to be felt though the region.
Read more: Alwihda Info
Vientiane in Ambitious New Bus Transit Project
Vientiane's Bus Rapid Transit system, now 63% complete, will cover 148 kilometers with dedicated lanes and median stations. The $99.70 million project includes 55 buses, each carrying 90 passengers, smart card payments, and e-pedicabs. Funded by ADB ($35 million), EIB ($20 million), and OPEC ($15 million), the system is expected to improve what has become chronic traffic congestion in the capital region. Launch is set for mid-2025 with a three-month free ride period.
Read more: Laotian Times
Laos-Vietnam Trade Ties Stay Tough
Bilateral trade with Vietnam reached $1.5 billion by September 2024, up more than a quarter year-on-year. Vietnam is among Laos' top three investors with nearly $5 billion invested across the tourism, mining, electricity, and agriculture sectors. Vietnamese businesses have 245 projects in Laos totaling $5.5 billion in registered capital. Both nations are shooting for $2 billion in bilateral trade through a new Trade Agreement signed in April 2024.
Read more: VietnamPlus
New Mekong Dam Raises Cross-Border Concerns
The planned $2 billion Sanakham hydropower dam on the Mekong River will displace more than 62,500 people across Laos and Thailand. Located 155 kilometers west of Vientiane, the 12-turbine project by China's Datang and Thailand's Gulf Energy Development is primarily expected to export electricity to Thailand. The Mekong River Commission has begun consultation processes with public forums planned across eight Thai provinces to gather more data.
Read more: BenarNews
Wage Implementation a Struggle to Get Right
Private companies in Vientiane are pushing back on the new minimum wage increase from LAK 1.6 million to LAK 2.5 million, plus a LAK 900,000 subsistence allowance for unskilled workers. Factory owners say that workers' lack of skills does not justify the raise. The labor ministry says it is aware of ongoing challenges as inflation and living costs continue to outpace salary adjustments.
Read more: Laotian Times
Laos Sets Goal of Economic Self-Reliance
Prime Minister Sonexay Siphandone has called on officials to improve organizational efficiency and fiscal discipline for the year ahead. The government cleared LAK 8,000 billion in state project debts and approved 746 state investment projects totaling LAK 20,957 billion. Local governments have been granted increased authority to approve projects up to LAK 50 billion.
Read more: The Star
Mekong Commission Launches Digital Tools
The MRC (Mekong River Commission) has introduced an Education and Visitor Center and One Mekong app in Vientiane. The facility features interactive exhibits, real-time monitoring tools, and connects to the Regional Flood and Drought Management Center in Phnom Penh. The One Mekong app provides public access to real-time river data and forecasts.
Read more: Laotian Times
South Korea Backs Lao Infrastructure
KOICA has granted $13 million for bridge upgrades and road safety improvements on a Laotian highway. The project includes bridge construction, safety equipment installation, awareness initiatives, and capacity building training. KOICA has also made a commitment of $8.1 million for agricultural projects, including digital land information development and livestock product safety management.
Read more: Asian News Network, The Star
Debt Crisis Hangs Over Laos
An IMF reports is showing Laos' debt servicing costs will rise from $1.1 billion to $1.5 billion next year, peaking at $1.8 billion in 2026. The debt-to-GDP ratio could reach 118% by 2025. GDP growth may decline from 4.1% to 2.5% by 2029. The country relies on Chinese debt deferrals, which totaled $770 million in 2023. Worrying numbers all around.
Read more: RFA
Major Solar Project in the Works
According to People's Daily, CGN has started construction of Laos' first large-scale solar PV installation in Oudomxay Province. The 1 GW facility will generate 1.7 billion kWh annually, powering as many as 10 million households. Electricity is expected to be transmitted to China's Yunnan Province via a 500 kV interconnection. More than 70 Chinese and Laotian enterprises are involved in the project.
Read more: Energy Trend
Mekong Security Cooperation Gets Muscle
Law enforcement departments from China, Laos, Myanmar, and Thailand recently reviewed joint patrol achievements in Rangoon. The Lancang-Mekong Cooperation initiative, heading into its 11th year in 2025, was especially focused on security issues (including targeting telecommunications fraud and drug crimes), as well as general economic development.
Read more: China Daily
Vientiane Posts Strong Growth
Vientiane Capital achieved 5.85% economic growth, handily beating the National Assembly's 0.30% target. Industrial production reached LAK 10 trillion, handicraft production contributed LAK 134 billion, and the service sector grew nearly 4%. Tourism pulled in 1.53 million visitors. Total investments reached LAK 31 trillion, surpassing targets by 53.84%.
Read more: Laotian Times
That’s all for this week, thanks for reading.
Your voice matters to us. Feel we're missing something? Have additional sources to suggest? Don't hold back— hit reply and help us get better.
If you value the Mekong Memo, please consider buying (or gifting!) a paid subscription, sharing it on social media or forwarding this email to someone who might enjoy it. Please also “like” this newsletter by clicking the ❤️ below (or sometimes above, depending on the platform), which helps us get visibility on the Substack network.