Laos continues to face economic challenges as its inflation rate remains at a staggering 24.4 percent in January, mirroring the December figure, according to a report by the Lao Statistics Bureau.
The Lao Statistics Bureau’s latest report revealed that, although the overall inflation rate remained unchanged from December to January, certain sectors witnessed substantial increases in prices.
Restaurants and hotels experienced a notable surge of 35.9 percent, while clothing and shoes saw a 33.4 percent increase. Health and medicine, food and non-alcoholic drinks, household items, and alcohol and cigarettes also recorded significant price hikes, with percentages ranging from 22 percent to 31.0 percent.
Factors contributing to this inflationary trend were identified in the report. First, the surge in demand for festivities led to an increase in the prices of food and alcoholic drinks. Additionally, the management of product prices, particularly for items on the list of managed products, has not been as effective as desired. Despite the appreciation of the kip against the dollar and baht, it did not have a direct impact on market traders’ price adjustments.
In response to these economic challenges, the Bank of Laos (BOL) has pledged to implement a tightened monetary policy, with a focus on stabilizing the value of the kip. This move aligns with the government’s broader plan to reduce inflation by 9 percent in 2024.
Prime Minister Sonexay Siphandone, on 26-27 December, directed relevant sectors to modernize revenue collection systems, identify new revenue streams, and minimize financial leaks. The BOL is committed to enhancing foreign currency regulations, increasing export revenue, and attracting investments to stabilize the kip’s value and combat inflation.