Govt switches focus to multi-sector growth
The government is focusing on multi-sector growth as the national economy develops, to minimise vulnerability.
Minister of Planning and Investment Mr Somdy Duangdy announced the government's policy on Wednesday during the annual government meeting with provincial governors and the Mayor of Vientiane.
Mr Somdy Duangdy speaks to the local press.
“GDP has increased through the growth of various sectors. Agriculture is an especially important sector and significantly contributes to GDP,” Mr Somdy said.
At a recent meeting with officials and civil servants from the Ministry of Information, Culture and Tourism, a National Assembly (NA) member responsible for economic, planning, and finance matters observed that the national economy was fragile, despite remarkable growth over the past five years.
The NA member said the economy was based on direct foreign investment, including investments in hydropower, which won't generate income for the country for several years, making it difficult for the government to raise enough revenue to meet growing expenditure needs.
He said the country's economic growth was based on the exploitation of natural resources, which would one day be depleted.
In response, Mr Somdy said GDP growth did not come from investment alone but also from agricultural production, including rice, other crops, and livestock. He reminded the meeting that agricultural output had increased 3 percent this year.
Mr Somdy said investment has partially contributed to growth, while domestic private investments also boosted the production of goods for domestic consumption and export.
The minister admitted that growth had largely relied on mining and hydropower up until now, but said the government is attempting to spread responsibility for growth to small and medium-sized businesses in other sectors. This is aimed at expanding and strengthening the economic platform.
“If we put too much reliance on any one sector, the economy will be fragile and at risk of collapse,” Mr Somdy said.
By Somxay Sengdara
(Latest Update October 13, 2012)