Country Profile: 

Population (thousand) (2015): 6,802.02
Multidimensional Poverty Index Value (2011-2012): 0.17
Inequality-adjusted Human Development Index, Country Rank (2014): 141
Gross Domestic Product per capita, at Purchasing Price Parity (2015) (US$): 5,675.5

CO2 Emission estimates (metric tonnes per capita): 0.3 (UN Statistics, 2010) 

 

Background

One of the contributing factors to Lao PDR’S impressive economic growth in recent years has been the rapid inflow of foreign investments from neighboring countries such as China, Vietnam, Thailand, among others.  With the expectation that this growth will solve challenges like poverty, unemployment, food insecurity and infrastructural gaps, this presents a golden opportunity for private investments to contribute directly to job creation, social development and environmental sustainability.

The PEI programme in Lao PDR is geared towards ensuring that the country’s rapid growth occurs in an inclusive and sustainable manner by benefiting impoverished communities and by protecting the strong natural resource base on which citizens depend.  PEI in Lao PDR does this by focusing on improving investment management, approval and appraisal processes in the country in a manner that maximizes economic benefits and minimizes adverse social and environmental impacts. 

This is ensured by a four pronged approach that includes the investment approval process, the investment management policies and processes, compliance and monitoring of investments and lastly, sound socio-economic research to support policymaking.

The programme is led by the Investment Promotion Department under the Ministry of Planning and investments, the Department of Environmental and Social Impact Assessments under the Ministry of Natural Resources and Environment and the National Economic Research Institute and provincial and local authorities. The programme’s second phase from 2013-2015 has received significant support from the Swiss Development Cooperation.  

 

 

Achievements: 

 

  • At the policy level, socio-economic development plans now systematically take into consideration environmental sustainability. The 7th NSEDP, the 2014-2015 Annual Development Guideline and most recently, the concept note for the 8th NSEDP have all integrated sustainable development and environmental protection. Addressing PE concerns has become one of the 8th NSEDP’s 3 key outcomes to be achieved by 2020.
  • The Government has strengthened its capacity to promote and manage quality investments with PEI’s support through the development and use of tools like the model investment contract that ensures job creation, environmental safeguards and poverty alleviation, a financial model for mining investments, revised investment progress reporting template, and One Stop Service – guidebook, and EIA/IEE Technical guidelines.
  • Addressing the key insufficiency of clear rules and procedures pertaining to the ESIA processes, the project has significantly contributed to advancing monitoring and compliance of projects at the national and subnational levels. A vital achievement has been the passing of Ministerial Instruction No. 8056/ MONRE that makes IEEs, EIAs and the issuance of the Environmental Compliance Certificate mandatory before investment projects can begin.  Technical guidance notes and criteria for assessments of these reports have also been established and are currently assisting officers to examine impacts more efficiently.
  • Currently, 17 provinces have adopted this instruction and over 200 central and provincial officers have gained greater knowledge and specialized trainings to conduct EIAs, through trainings and workshops. This has resulted in the monitoring of 287 projects in 17 districts in 6 provinces across Lao PDR. Complementing this, a web-based compliance database has also been set up and officers are being trained to use this.
  • The government has strengthened its capacity to review and identify the level of public involvement in the investment approvals and management process. A public involvement baseline study has been conducted which includes criteria and indicators for defining the level of PI in investment approval process.
  • The National Assembly’s capacity to take decisions that promotes sustainability is increasing. Furthermore, Assembly’s commitment to promoting quality investments is also strengthening with greater understanding of issues and informed policy-making, through sound socio-economic research carried out by NERI and also challenges of investment management implementation face by the IPD and DESIA. The Assembly hotline is now inundated with calls regarding land rights and compensation. For the first time, mid-level planning officers are equipped with legal tools for responding to those appeals.
Key Documents

Raising awareness, communications and building partnerships

Indicators and data collection

Integrated Ecosystem Assessment

Economic Analysis

Influencing policy processes - National, sector and sub-national levels

Understanding the governmental, political and institutional context

Influencing policy processes at national level - National Poverty Plans and Strategies and Poverty-Environment Mainstreaming Guidelines

Economic instruments

Mainstreaming Resources: 
Lao Land Issues Working Group
Environment Protection Fund Lao PDR
Centre for Development and Environment Institute of Geography, University of Bern
Greater Mekong Sub-region Environment Operations Center
Asian Development Bank Lao PDR