Australia Supports Laos in Improving Transport and Trade Connectivity

Australian Ambassador Paul Kelly signs the MSA with Deputy Minister of Public Works and Transport Vilaykham Phosalath
Australian Ambassador Paul Kelly signs the MSA with Deputy Minister of Public Works and Transport Vilaykham Phosalath.

The Australian Government is supporting the Government of Laos in improving transport connectivity, cross-border trade, and logistics along an east-west corridor in northern Laos.

A new Subsidiary Arrangement, under a broader agreement between Australia and Laos on development cooperation, was signed by Australia’s Ambassador to Laos, Paul Kelly, and Vice Minister of Public Works and Transport, Vilaykham Phosalath on 7 July in Vientiane Capital.

The signing was witnessed by the Minister of Public Works and Transport, Viengsavath Siphandone.

Australia is expected to provide more than AUD 10 million in support under the arrangement.

Australia’s assistance will be made through the Partnerships for Infrastructure (P4I) initiative, in collaboration with the Ministry of Public Works and Transport, Ministry of Planning and Investment, and provincial stakeholders, and delivered as part of the Southeast Asia Regional Economic Corridor and Connectivity (SEARECC) program.

Speaking at the signing, Transport Minister Viengsavath Siphandone said, “the SEARECC project is a priority for the Ministry of Public Works and Transport and for the Government of Laos. It will support the national agenda on addressing economic and financial difficulties and the 9th National Socio-Economic Development Plan (2021-2025)”.

He said he hoped that the project would help attract foreign investment and generate sustainable incomes for Lao people.


Ambassador Paul Kelly said, “improving transport connectivity, planning and cross-border trade will support Laos’ transition from a land-locked to land-linked country, and increase investment and employment opportunities”.

P4I’s assistance builds on Australia’s long-standing engagement in Laos and the region as the two countries celebrate the 70th anniversary of diplomatic relations.

The SEARECC project was approved by the Government of Laos and the World Bank in May 2022 to improve regional and domestic trade, and climate-resilient transport connectivity. The focus is on five northern Lao provinces, including Oudomxay, Luang Namtha, Phongsaly, Luang Prabang, and Xayaboury.

Australia’s assistance through P4I will support the upgrade of cross-border facilities along Laos’ National Road No. 2, a priority project under the Association of Southeast Asian Nations’ (ASEAN) Master Plan on ASEAN Connectivity 2025 (MPAC 2025).