Australia’s Strategic Investments Propel Mekong Subregion Forward

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Laos is central to the economic development of the Mekong subregion. The ongoing expansion of basic infrastructure in Laos is a key national priority. This is why Australia has been working to support the implementation of Laos’ priorities for basic infrastructure, road maintenance, and land links with its neighbors for more than 30 years.

While many are familiar with the First Friendship Bridge financed by Australia in the early 1990s, few may know about Australia’s significant contribution to connecting the Mekong subregion. From 2007 to 2014, Australia played a pivotal role in the Northern Greater Mekong Subregion Transport Network Improvement Project, to boost transport efficiency and increase economic activities in the Greater Mekong Subregion.

Australia in partnership with the Government of Laos, Asian Development Bank (ADB), Republic of Korea, and the OPEC Fund contributed to the USD 117 million project that focused on upgrading National Road 4, an important roadway stretching 367 kilometres from Luang Prabang Province to Xayaburi Province. The project not only constructed and rehabilitated small bridges, drains, and roads but also extended these facilities to rural areas, ensuring wider reach and connectivity.

Vanthong Inthavong, Project Officer with Laos Resident Mission of the Asian Development Bank

Vanthong Inthavong, Project Officer with Laos Resident Mission of the Asian Development Bank, highlighted the project’s impact, stating: “Now, travelling from Luang Prabang to the Lao-Thai border in Xayaburi via National Road 4 is feasible in any weather, cutting down the journey to about 4-5 hours from the previous 9-10 hours.”

By improving the major highway connecting Luang Prabang to the Lao-Thai border in Xayaburi, the project aimed to elevate the Lao people’s living standards, minimise travel time and expenses, and boost the export of goods. Upon the project’s completion, Inthavong observed: “The value of agricultural land has doubled, and we now see a surge in tourism and other service-oriented activities along Route 4.”

Like many infrastructure projects, this one faced some challenges. Nevertheless, the project persevered. Inthavong concluded that finally: “the roads and facilities from this project will serve the public and benefit everyone.”

Megan Jones, Australian Ambassador to Laos said that “Australia is committed to continue working to support Laos’ national priorities, including its connectivity agenda.”