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Food import surge an economic challenge
The amount of food being imported into Laos is increasing rapidly despite the country having an agriculture-based economy.
The rise in food imports reflects the fact that economic growth in Laos has not brought about the expected increase in domestic production.
According to a report from the Min istry of Industry and Commerce, the amount of food imported into Laos – a country with a population of just over 6 million people - saw 40 percent growth in the past six months of this fiscal year. This is a strong indicator of an insufficient domestic supply of food.
Laos spent about US$100 million on food imports last fiscal year, with food becoming one of the top five major import categories. The rise in food imports has become a new challenge for Laos as it strives to bolster domestic production.
Laos has plenty of farmland suitable for agriculture and livestock. Given this fact and the surge in imports, people are asking whether Laos can be self-sufficient in food, which is fundamental to our daily life.
According to a report from the Ministry of Agriculture and Forestry, Laos has 655,000 hectares of rice farmland with total production capacity of 2.5 million tonnes. Laos also has plenty of land suitable for the cultivation of cash crops such as sweetcorn, vegetables and beans.
Laos also has the capacity to produce 148,000 tonnes of beef, fish and eggs.
The country not only faces a major challenge over rising food imports, but also in the quantity of fuel, vehicles and construction materials being imported.
The import value of fuel and gas saw 80 percent growth in the first six months of this fiscal year compared to the same period last year when US$434 million worth of fuel was imported.
Vehicle imports also rose 80 percent in the same time period. Last fiscal year Laos imported US$276 million worth of vehicles.
The import value of electrical equipment saw about 3 percent growth while construction materials saw growth of 19 percent. Last year Laos imported US$286 million worth of electrical equipment and US$216 million worth of construction materials.
Total imports in the first six months of this fiscal year amounted to about US$1 billion while the export value in the same period was US$836 million, resulting in a major trade deficit of about US$200 million. Last fiscal year Laos recorded a small trade surplus.
The surge in imports also reflects economic growth. The Lao economy grew 7.9 percent last fiscal year and is on track to achieve 8.5 percent growth. The main driving force of the economy is still mining and power generation, though many people say exports in these sectors are unsustainable due to the gradual depletion of natural resources.
The Lao processing industry, including garments, is also becoming a new driver of the economy. Laos is now promoting the export of ‘green' products and is developing sustainable tourism as a foreign exchange earner.
vientiane times
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