ABOUT LAOS

Geography
Laos is a landlocked country in the center of Indochina. It shares borders with China and Burma to the north, Cambodia to the south, Thailand to the west and Vietname to the east.

Approximately 70% of its total area (236,800 square kilometers) comprises of mountain and plateaux areas.

Mekong river (one of the longest rivers in the world) forms a natural border with Thailand. It flows through almost 1,900 kilometers of the territory of Laos.


Population
It was estimated that, in 1999, the population of Laos was 4.8 million. Around 85% of the population are farmers and live in rural areas. There are 3 main ethnic categories: Lao Loum (low landers), Lao Thueng (lower mountain dwellers), and Lao Soong (high landers). The great majority of Lao are Buddhist.


Climate
Laos has a warm and tropical climate with two seasons: the rainy season from the beginning of May to the end of September and the dry season from October to April. The average temperature 29 degree centigrade. Maximum temperature can reach up to 40 degree centigrade. Temperatures can drop to as low as 15 degrees or even lower in mountains. Generally, tourists are recommended to visit Laos during the months of November to March because these are cool months and rainfall is lower than other periods.


Language
The official language used in Laos is Lao language. However, the usage of the language can differ from north and south. English, French and Russian are spoken in business or by some senior government officials. Many shopkeepers can understand basic English and French.


Electricity & Water
Laos uses 220 volt (50 Hz) electricity for use with either two-pronged round or flat plugs. It is not recommended to drink directly from taps since it is not very clean. However, purified water is available throughout the country.


Currency
Lao national currency is Kip. There has been some devaluation of Lao Kip in the past few years. There are exchange booths available throughout town. Major credit cards are also accepted in large shops. You can also withdraw cash by using your credit cards, but it has to be done at a bank, since there is no automatic teller machine in Laos just yet.


Communication Facilities
Public phones are available in Vientiane and other major cities. You can also go to Lao Telecom office to call and fax overseas. Phone cards are widely available in most convenient stores. There are a number of Internet cafes in Vientiane and major cities. So you can be sure that you can always keep in touch with your family and friends.


Macro-Economic policies and economic system
Economic structure
The economic structure of the Lao PDR consists of many sectors under different forms of ownership and economic organizational system, but these sectors are equal before law and operate under the management of the state with the view to freely cooperate and compete in their business activities.


Legal system
As we have seen the Government wish to encourage competitiveness in the market. This is in line with improving economic relations with other countries; the National Assembly has promulgated a number of laws and regulations with the view of ensuring trade and investment in Laos. At present we have more than 40 laws including investment and business law.


Monetary and banking system
The policy of foreign exchange management is moved to a floating exchange rate system since 1995. In the field of broadening the economic relation with foreign countries, the Government extended business licenses to local and foreign banks with purely conducted commercial banking activities. Up to now the banking system in Lao PDR is comprised of the Central Bank, Lao state owned commercial banks, seven branches of foreign banks and Lao private commercial bank.


Customs regulations
Under the custom law of the Lao PDR the totally of tariff lines is 3552 with tariff rate ranging from 5%-40%. More than 50% covered the major part with 5% tariff rate and others with 10% and 20% tariff rates. The goods imported to Laos and exported from Laos are required to obtain the licenses and must be declared at the custom office. The import duties, which have only a mild protective component, are collected at regional customs posts, based on the valuation method of the GATT (General Agreement on Trade and Tariff).


Trade expansion policy
Since 1986 Lao PDR has implemented a new economic mechanism. Thus plans were set in motion to transform the centrally planned economy to a market economy under the direct management of the state. All economic development and to compete and freely cooperate in their business activities. Therefore since this time Lao PDR has been steadily progressing towards a market economy.

More information on economic issues please visit www.moc.gov.la