The International Monetary Fund (IMF) predicted that Laos’ economy will grow by 4 percent this year and in 2024, thanks to China reopening its borders and removing travel restrictions.
During the April World Economic Outlook, the IMF said that despite worldwide economic uncertainty, Laos is likely to see economic growth as China, one of the country’s main trading partners, has reopened its borders.
“The reopening and growth of its economy will likely generate positive spillovers, with even greater spillovers for countries with stronger trade links and reliance on Chinese tourism,” said the report.
IMF has foreseen a higher economic growth prospect for emerging markets in developing Asia compared to more advanced economies, and the global economy as a whole is expected to see slower growth as well. The average growth for the former will be around 3.9% this year and will rise to 4.2% in 2024.
In the coming months, one of the greatest challenges for Laos will be to rein in its sky-high inflation, as the rising cost of products and services imposes additional challenges on a population already struggling to escape poverty, the Vientiane Times reports.
In Laos, the cost of consumer products is projected to increase by 15.1 percent, the highest of any emerging and developing nation in Asia, says the IMF.