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PM: Railway will benefit economy, development

Prime Minister Thongloun Sisoulith has told a regional meeting in Japan that the Laos-China railway, which is part of the China-led Belt and Road Initiative, will greatly benefit Laos’ economy and overall development, Japan’s Nikkei reported yesterday.
Given Laos’ goal of graduating from Least Developed Country status, the premier told the Future of Asia conference in Tokyo that the Lao government intends to transform Laos from a landlocked to a land-linked country, and that the under-construction railway is pivotal to this plan.

“We hope that the construction of the railway will encourage and promote investment and cooperation and bring benefits to the country,” he was quoted as saying by Nikkei.
The conference was convened under the theme “Keeping Asia Open How to achieve Prosperity and Stability”. 
As of May 31, construction of the US$5.986 billion (37.4 billion yuan) railway was 33.8 percent complete. The five-year construction plan has a completion date of 2021, the government told the ongoing 5th ordinary session of the National Assembly last week.
Mr Thongloun told the conference that Laos is unconcerned about the potential debt burden arising from the Laos-China project, in which Laos holds a 30 percent stake and China owns 70 percent, describing the terms of the construction agreement as “favourable”, Nikkei quoted the head of government as saying.
The Laos-China Railway Company, a joint venture company, will share the burden.
“And on the part of the Lao government, we will have one-fifth of the budget for the construction,” Nikkei quoted Mr Thongloun as saying.
“I am not concerned much about the burden of debt or the construction of the high-speed railway. I can see that provisions in the construction agreement are favourable.”
Mr Thongloun told the conference that Laos’ revenue generation is mainly based on natural resources - a source of income that economists suggest is not sustainable.
The government is aware of this and has devised an ambitious plan to modernise and industrialise the country so as to diversify the economy in a sustainable manner.
“We will need to work towards modernisation and industrialisation and to make sure that people have more income,” he told the conference.
To pursue the goal of industrialisation, the government places great importance on developing a railway network to transform Laos from being landlocked to land-linked, in order to spur greater domestic and foreign investment.
The Laos-China railway will form part of the planned regional rail network connecting China’s Yunnan to Singapore via Laos, Thailand, Malaysia and Singapore.
Highlighting the significance of a railway for the country’s future development, the premier told the Tokyo conference it will add fuel to the government’s efforts to ensure Laos graduates from Least Developed Country (LDC) status, possibly by 2024.
Prior to his visit to Japan, the prime minister told the National Assembly that Laos would not be able to graduate from the United Nations’ listed LDC by 2020 as targeted.
LDCs are assessed using three criteria: the human asset index (HAI) which assesses health and education targets, gross national income (GNI) per capita, and economic vulnerability.
Countries must meet two of the three criteria at two consecutive triennial reviews by the United Nations.
The 2018 assessment showed that Laos passed the first two indicators and if the country sustains development gains and meets the criteria again in 2021, it will be formally removed from the list of LDCs in 2024, according to the UN.
Delivering his speech, the Lao Prime Minister called for greater opening up to increase cooperation within the Asian region, and between Asia and other regions in an effort to protect peace and stability across the regions.   


By Times Reporters
(Latest Update
June 13,
2018

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