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This month in Laos - February 2020


1. Economic resilience despite facing challenges


The Laotian economy is projected a stable growth of at least 6% this year, despite ongoing challenges including a long dry season, the Coronavirus outbreak, and the US-China trade war. To first look at some of the challenges, the lengthy dry season in 2019 may reduce agricultural production levels and lead to electricity generation cuts due to the low water reservoir levels. Additionally, the Corona virus will strain the service sector. The Chinese government has now banned Chinese tour companies from traveling abroad. This means that in the first two months of 2020, Laos could lose alone earnings of around US $20-25 million from cutbacks in tourism.

Albeit these challenges, sectors with strong growth potential, including agriculture and tourism, should be further developed to ensure stable economic growth. For such sector developments to happen, the standards of education for a better skilled workforce must improve and the value chain must be coupled with advanced technologies. Just as important is that a stable economy requires a stronger response to climate change and natural disasters, which increasingly affect economic prosperity. Meanwhile, officials should closely monitor and promptly respond to any disease outbreaks.


2. A glimpse into working at a local night market

Despite the growing tourism sector, an estimated 75% of the workforce is still absorbed by Laos’ rice- based agriculture. However, tourism provides a viable alternative to this rather harsh way of life and many young Laotians move to the cities in hope of better opportunities. While many work in restaurants, hotels or as tuktuk drivers, the sale of local products at the local night market in Luang Prabang has become also a popular choice.


At the age of 16, Khoasone discovered his passion for art, when a generous foreign tourist donated high quality brushes, paint and paper to the orphanage in Luang Prabang where he grew up. Quickly he learned about different techniques and developed his own style, portraying common scenes like monks walking the street with vibrant water colors. Someone suggested that he should try and sell his art at the local night market and much to his surprise, he sold all his paintings. Soon he was earning the equivalent of USD2000 per month, just by selling what he himself had created. The harsh reality however is that Laotian markets are brutally competitive. Now only four years later, Khoasone is making a fourth of what he did initially as others had copied his paintings and were selling them on the market as well. Now he is faced with a tough choice, either to discover a new style or find a new customer base. This story is only one of many and show the harsh reality of making a living in Luang Prabang, Laos.


3. Worries around a global pandemic?



News about the Coronavirus outbreak are flooding the global news. Since late 2019 after the first cases in China, the outbreak has spread rapidly. Southeast Asia is vastly exposed to the virus, yet exactly here the infrastructure and the state are least prepared. Initially, reports indicated that several Southeast Asian ministers downplayed the severity and at most only offered public suggestions of folk remedies for combatting the virus. However, with Coronavirus’ rapid growth, governments now have begun to respond more forcefully. As shown in the picture, the Association of Southeast Asian Nations (ASEAN) foreign ministers met for an emergency meeting with China's Foreign Minister Wang Yi on the coronavirus outbreak in Vientiane, Laos on February 20th, 2020.

Nevertheless, countries such as Laos and Cambodia lack a good public health care system to handle the scale. Infectious disease experts worry the number of reported cases from Southeast Asia do not reflect the real spread of the disease given the region’s weak public health systems, and because people can be asymptomatic at first when they have the coronavirus. With cases already in Europe and Canada, the severity can clearly not be downplayed. Therefore, if one thing is clear countries in Southeast Asia will need extensive assistance from the international community to keep the current situation, as best as possible, under control.

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