The State Inspection Authority has flagged USD 1.976 million in diverted funds and spending on unused assets in Vientiane’s USD 99.7 million Bus Rapid Transit (BRT) project.
On 8 October, State Inspection Authority President Vansay Phongsavanh presented the findings to the National Assembly, as part of a national review of public projects covering the first nine months of 2026.
The questioned spending involves two main issues. The project diverted USD 1.52 million to upgrade nine roads outside its approved scope, including one unapproved road project costing USD 584,508. It also spent USD 456,000 to buy 150 electric three-wheeled vehicles.
According to Vansay, each vehicle cost USD 3,040 and was intended to support the transit system. However, all 150 remain unused because project organizers failed to build or designate parking spaces for them.
The inspection also found broader problems with the project’s administration. Of 33 contracts worth USD 58.71 million signed between 2018 and 2025, none included a Lao-language version.
Auditors also found repeated contract extensions without corresponding progress. In some cases, BRT stations were built and later demolished because their designs had not received official approval.
Authorities have yet to disclose the full financial impact, as inspections of the project remain ongoing.
Road Funds Misuse
The inspection also uncovered problems with road funding in Vientiane Capital and Xaysomboun Province.
Auditors found that the government used budget allocations from 2024 and 2025 to repay debts from projects dating back to 2017.
Of the 178 projects reviewed, 44 had been signed for amounts exceeding the limits approved by the National Assembly. In seven cases, contractors carried out new construction over existing projects that were still within their warranty periods.
Auditors found similar financial discrepancies in state investment projects in Vientiane Capital.
Inspectors reviewed 58 projects and found mismatches between payments recorded by the Vientiane Finance Department and those reported by private companies in 30 cases. The total unaccounted difference amounted to LAK 706.47 billion (USD 31.4 million).
Many projects dating back to 2015 had also bypassed standard procedures. Auditors found that they proceeded without bidding, project proposals, or the required 10 percent guarantee deposits.
EDL Debt and Illegal Mining
The audit also flagged problems with project funds linked to Electricite du Laos (EDL).
Investigators found that USD 41.47 million in project funding remains with a third-party company. The company reportedly received the money from a lender but never transferred it to EDL.
Vansay also told lawmakers that illegal mining and logging remain widespread in several provinces. He attributed the continued extraction of natural resources to weak law enforcement and a lack of leadership among local and senior officials.
Nationwide Corruption Crackdown
Beyond public projects, Vansay reported that authorities were investigating 10 major corruption cases involving 58 people across Laos.
The findings follow a series of provincial investigations into financial misconduct. Recent probes have uncovered financial irregularities in Attapeu Province, prosecutions of 37 people in Champasak over five years, and millions of dollars in losses linked to official violations in Hoouaphanh.
Authorities estimate that state losses identified in the latest investigations total USD 313 million over nine months. They plan to introduce digital databases to track state assets, but officials acknowledge that substantial amounts of misappropriated public funds remain unrecovered.
