Laos has begun selling shares in its state enterprises to local investors as part of reforms expected to unburden the state amid economic woes.
A ceremony was held yesterday to mark the sale of a 49 percent stake in the Lao Logistics State Enterprise to Sitthi Logistics.
The agreement was signed by Mr. Sonephet Inthavong, Head of the State Enterprise and Insurance Reform Department, Ministry of Finance, and Mr. Viengkhone Sitthixay, Director of Sitthi Logistics.
The logistics state enterprise is the latest in a number of state enterprises to sell large stakes to the private sector, following the sale of 51% of Enterprise de Postes Laos last month to AIF Group.
The Lao Development Bank and the Agriculture Promotion Bank were also taken over by private sector investors last year.
According to Vientiane Times, Lao Minister of Finance, Mr. Bounchom Oubonpaseuth, said the process of restructuring the Agriculture Promotion Bank experienced delays because officials had to address embezzlement at the bank resulting in losses of some LAK 260 billion.
Meanwhile, a reform committee was set up to carry out the restructure and reform of some of the country’s largest state enterprises, including Electricite du Laos, the Lao State Fuel Enterprise, and EDL-Generation Public Company.
The government has also asked the Prime Minister to authorize another committee to oversee the reform of Lao Airlines, the Agro-industrial Development Company, and the Lao Export-Import Trading Company.
As part of reforms, the government may continue to hold a stake in some enterprises, while others will be sold off completely, and some will be completely dissolved.
Minister Bounchom said that state-owned Inter Lao Tourism, DAFI, and the Lao Cotton State Enterprise will be dissolved.
EDL-Generation Public Company is to remain a public company, while Electricite du Laos will remain a wholly state-owned enterprise. Both companies will undergo comprehensive restructuring and reform, however, in line with recommendations by the government and each company’s respective board.
The Vientiane People’s Court in 2020 sentenced a former director of Lao Logistics State Enterprise to life imprisonment on charges of corruption.
