Human capital—the knowledge, skills, and health needed for boosting productivity—is the most important form of capital for the growth of society, and Laos is not currently developing its human capital sufficiently to keep pace with other countries.
The Lao government and its partners, including the World Bank and UNICEF, among others, agreed on 23 November to hold a second Human Capital Summit next year, focusing on the crucial issue of nutrition. The decision was made at a meeting chaired by Phonevanh Outhavong, Vice Minister for Planning and Investment, where participants heard a report from the Ministry of Health showing that the nutritional status of Lao children has been declining, particularly in rural areas.
“In Laos, high levels of childhood undernutrition present a huge but avoidable loss of human and economic potential. Stunting can cause long-term damage that lasts far beyond childhood, including slower learning ability and lower productivity and wages in adulthood. Stunted children cannot develop to their full potential, and this affects national productivity and economic growth,” said Tara Béteille, World Bank Senior Economist.
Nutrition is an area of particular weakness, with about 33 percent of children under five years old below normal height levels for their age, while 21 percent are underweight, and 9 percent are wasted. These are all signs of undernutrition, which mostly affects the poor and ethnic groups, mainly in rural and upland areas.
At the first Human Capital Summit, held in Vientiane in May this year and chaired by Prime Minister Sonexay Siphandone, the government committed to improving the quality of basic education, enrolling all children and keeping them in school, and improving education financing.
The summit helped bring educational deficiencies to public attention, and the recently concluded National Assembly session featured a detailed discussion of education policies and funding. It is hoped that the second summit can have a similar effect in focusing attention on nutrition.
While Laos has made progress in combating poverty and nutrition problems in recent years, the combined shocks of COVID-19 and recent economic problems are threatening to reverse its successes.
World Bank surveys show that around 87 percent of households report being affected by inflation, and to cope, many are switching to cheaper food or reducing the amount of food they eat. Data from the National Nutrition Surveillance system indicate a significant drop in the quality of food given to young children, with only one in ten children fed the minimum diet required to grow, develop, and meet their full potential. Altogether, Laos is currently losing around 2.7 percent of its GDP due to malnutrition.
Pia Rebello Britto, Representative for UNICEF Laos, said, “Improved nutrition is vital if the country is to turn its potential advantage of a young population into economic and social gains. At the next Human Capital Summit, we can assess if current investments are addressing malnutrition in the most optimal way”.
