Simpler investment terms will attract more domestic and foreign investors, particularly in specific and special economic zones.

Govt eyes large-scale investment to drive economic growth

The government is aiming to source investment amounting to 636,178 billion kip, equivalent to at least 24 percent of Gross Domestic Product (GDP), as part of its strategy to accelerate economic growth and advance development objectives over the next five years.
To support the investment drive, the government will implement a series of strategic measures, including decentralisation of authority to local administrations, more effective monetary and exchange rate management to reduce reliance on foreign currencies, continued efforts to improve the investment climate to attract domestic private investment and Foreign Direct Investment (FDI), and accelerated industrialisation and digital transformation to enhance productivity and modernise services.
Under the new investment framework, funding will be sourced from a mix of public, private and external sources, with a strong emphasis on private sector participation and FDI as drivers of growth.
The plan was presented by Prime Minister Sonexay Siphandone at the 12th National Congress of the Lao People’s Revolutionary Party last week.
Domestic investment is projected at 116,000 billion kip, accounting for 18.2 percent of total investment, reflecting the government’s continued commitment to infrastructure development, public services and priority socio-economic programmes.
Official Development Assistance (ODA) is expected to contribute 71,277 billion kip, or 11.2 percent of total investment, underscoring the ongoing role of development partners in supporting development efforts.
The largest share of investment is anticipated to come from the domestic private sector and foreign direct investment, estimated at 409,470 billion kip and representing 64.4 percent of the total.
This highlights the government’s focus on improving the business environment, streamlining administrative procedures and promoting investment-friendly policies.
In addition, other investment sources are projected to provide 39,431 billion kip, or 6.2 percent of total investment.
The new targets build on strong investment performance during the 2021–2025 period, when Laos secured total investment of 387,372 billion kip, equivalent to 189 percent of the planned target, according to the government’s report to the Congress.
Presenting the socio-economic review, Prime Minister Sonexay said investment significantly exceeded the original target of 204,599 billion kip, reflecting robust participation from both domestic and external sources despite regional and global economic challenges.
During this period, domestic investment reached 22,080 billion kip, equivalent to 96 percent of the plan, while ODA investment totalled 54,493 billion kip, surpassing the target at 146 percent.
The strongest performance came from domestic and foreign private investment, which reached 266,494 billion kip, or 266 percent of the plan, compared with the original target of 100,000 billion kip, underscoring growing private sector confidence and improvements in the investment climate.
Other investment sources, including contributions from communities and the general public, amounted to 44,305 billion kip, achieving 100 percent of the planned target.
Prime Minister Sonexay said the strong investment outcomes of the past five years had laid a solid foundation for economic recovery, job creation and long-term development, while easing pressure on public finances.
He said the government would continue to prioritise administrative reform, investment promotion and private sector engagement under the next five-year development plan.

By Times Reporters
(Latest Update January 14, 2026)