Friday, 29/03/2024

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Towards the ASEAN Community : Laos turn challenges into opportunities.

ASEAN Economic Community ( AEC ) , will officially take effect on the date of 31.12.2015 , was a watershed marking the integration of a comprehensive area of Southeast Asian nations on the economic front . The establishment of the AEC opens promising opportunities , but also bring many challenges for the regional economy , including Laos - countries will hold the ASEAN chairmanship in 2016 

Though being small-scale economies in Southeast Asia , but Laos is one of the countries with the fastest growth rate in the region in recent years with the medium average 8 %  growth of total gross domestic product ( GDP ) 

Lao Prime Minister Thongsing Thammavong stressed the benefits AEC brings back for Laos is very huge , because the markets are becoming more open and attractive . The ASEAN member countries remove tariffs will provide an opportunity for Laos to exports to the internal market , and conversely, imports from ASEAN into Laos will be cheaper. 
 
According to experts, the country will have accumulated much experience when joining AEC , especially in areas such as training human resources , skilled labor , as well as improve their knowledge , abilities in management economic , labor management , investment management , immigration management . Effectively applying this experience will be beneficial to the development of the country , help Laos tackling poverty and economic development - social , catch up with the other member countries of ASEAN .

n addition, experts believe that abundant natural resources would be advantageously  help Laos boost electricity exports. Laos could also attract more foreign investment because of owning vacant land areas suitable for investment projects . The capital investment is very important for the economic development of Lao society .

Besides, the existing tourism potential , Laos will also attract more international travelers entering AEC.

However , there are also challenges and difficulties . Economy Laos is not strong enough to compete with other ASEAN members so the establishment of the AEC , or more broadly, the ASEAN Community , will make Laos steeped in danger of imports from ASEAN countries .

Domestic investors also face a growing competition from foreign investors . Goods export of Laos to ASEAN markets also face similar challenges .

Also, infrastructure , transportation and underdeveloped services and banking system is still limited may put Laos in a disadvantage when integration. Meanwhile , labor of Laos is lacking and weak , mostly unskilled labor , skilled labor is small , foreign language skills as well as experience of working in an international environment is weak.

To overcome the above drawbacks and quick integration with AEC , ministries and departments of Laos is trying to prepare in all aspects. Laos is promoting the policy of "Bridging the gap and develop towards ASEAN integration . " The preparation for AEC integration process focuses on four areas: improving the understanding of the economic linkages regional and international , to enhance cooperation between state enterprises and private research on commercial production , including support for small and medium enterprises ; improving the provisions relating to operating activities business .