Photo taken on Nov. 16, 2018 shows a tea plantation at Bolaven Plateau in Champasak Province, Laos. (Xinhua/Liu Ailun)
VIENTIANE, June 17 (Xinhua) -- The Lao government will reduce the budget deficit to zero by next year to ensure that the country's high level of public debt can be repaid as promptly as possible, local daily Vientiane Times quoted Deputy Prime Minister Somdy Duangdy as telling the ongoing National Assembly (NA) meeting.
Somdy, who is also Minister of Finance, said, "We will ensure our spending plan is set at a level commensurate to what we earn," when addressing the Assembly's ordinary session.
"It is a challenging issue," the Lao deputy prime minister said when responding to questions raised by MPs last week about what measures the government was taking to manage and repay its seemingly chronic debt.
Lao Prime Minister Thongloun Sisoulith (front) addresses the Lao National Assembly in Vientiane, Laos, on June 5, 2019. Thongloun Sisoulith has pointed out difficulties and shortcomings facing the economy in a report presented at the seventh session of the eighth legislature of the Lao National Assembly, which held in Lao capital Vientiane Wednesday. (Xinhua/KPL)
The government's actions to reduce public debt are in accordance with the Law on Public Debt. As such, the government can only borrow money when special conditions are in place. These include long-term repayment periods of at least 25 years, interest rates not exceeding 1.5 percent and six to seven year repayment free periods, said the report.
To control spending, the government has cancelled all unnecessary projects and limited the number of new ones to those that are essential.
It is hoped that a state investment focus will accelerate the completion of some already existing programs. Authorities have carried out inspections of project sites to ensure investment costs are reasonable in another measure to control spending.
