Economic reform: the Lao experience

Abstract

LAO PDR is now in the process of transition from central planning to a market economy, open to international trade. Over recent years, the government has been engaged in a comprehensive programme of economic reforms known as the New Economic Mechanism (See the list of major economic reforms from 1985-90 at the end of this paper). The main aims of this policy are: • To reduce severe macroeconomic imbalances and improve macroeconomic performance. • To eradicate serious microeconomic distortions which affect various sectors of the Lao economy. • To re-allocate scarce resources rationally and promote sustained economic growth.