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Stable kip, low inflation are bank's highlights
The governor of the Bank of the Lao PDR believes the bank has successfully played its role over the past five years, highlighting the stability of the kip and single digit inflation as noteworthy achievements.
Mr. Phouphet Kham-phounvong spoke to media yesterday at the Bank of the Lao PDR to review the bank's activities for the 2006-2010 period.
“From 2006 to now, we have maintained the stability of the kip and the inflation rate is low, with the one digit inflation rate lower than the GDP growth rate.”
“These were among the government's plans set for the last five years and we believe we've achieved them.”
Mr. Phouphet said the kip was worth about 9,000 kip to the US dollar in 2006 and is now fetching 8,000 kip to the dollar. Inflation has averaged around 6 percent a year over the five years, while GDP has grown by around 7 percent.
“It's a good sign that we've kept the inflation rate lower than GDP growth and we will strive to maintain this.”
He said the stability in the value of the kip and low inflation has increased confidence in the national currency and encouraged its wider use. “The stable currency encourages national economic growth as it boosts the confidence of people doing business.”
“At the same time, it has also increased the confidence of foreign investors coming to do business in Laos.”
“Government policy and our determination in implementing the policy are the factors behind the bank's success.”
Mr. Phouphet added that use of the kip has increased because the government has encouraged banks to provide more exchange units and also allowed the private sector to enter into the currency exchange market under the management of the bank.
“Stabilising the kip and keeping the inflation rate lower than GDP growth are also the priority areas for the bank over the next five years.”
“To achieve these goals requires not only the hard work of the bank and the government but also the cooperation of all Lao people.”
“As we have an agriculture-based country, we need to boost production and increase exports in order to keep the kip stable.”
“At the same time, we should limit imports of items that Laos can produce.”
“All of this requires the help of all people,” he added.
“Laos is in a good position now and we need more efforts to keep a good balance.”
vientiane times
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