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Doing business in Lao PDR : constraints to productivity

New available data suggests that the business environment in Lao Peoples Democratic Republic (PDR) is not improving, and may be deteriorating. The main constraints to doing business named by firms surveyed in the 2016 enterprise survey are the practices of the informal sector, with 40 percent of respondents identifying this as a major issue, followed by tax rates at 33 percent and transportation at 23 percent. Lao PDR has demonstrated impressive economic growth for the past decade, with gross domestic product (GDP) growth averaging 7 percent, largely concentrated in the natural resource sector. However, this has been accompanied by a less than proportionate decline in poverty and rising inequality. The main identified constraint to investment was the practice of firms in the informal sector, with 40 percent of respondents citing this issue as a serious problem. Coming in second was tax rates, cited as a constraint by 33 percent of firms. Large percentages of firms also mentioned that transportation, electricity, and inadequately educated workers were major problems. Large firms were more likely to consider workers education a problem, while transportation was proportionally a bigger issue for medium firms, as was tax rates for smaller firms. Regionally, firms in the north and south of the country were more likely to identify key issues as major problems than firms located in the central region or Vientiane.

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Additional Info

Field Value
Document type Reports, journal articles, and research papers (including theses and dissertations)
Language of document
  • English
Topics Economy and commerce
Geographic area (spatial range)
  • Lao People's Democratic Republic
Copyright Yes
Version / Edition 1
License Creative Commons Attribution
Author (corporate) World Bank
Publisher World Bank
Publication date 2018
Pagination 78
Date uploaded May 29, 2019, 04:06 (UTC)
Date modified November 29, 2019, 04:00 (UTC)