Laos Country Risk Report Q4 2019
We at Fitch Solutions expect economic activity to cool gradually in the coming years, with growth stabilising around the 6.0-6.5% range over the medium term.
Construction activity and rising tourist arrivals should support the economic expansion, though high import demand will ensure a negative contribution of next exports.
Rising government debt and persistent budget deficits will restrict the government's capacity for pro-growth spending over the coming years.
Despite the criticisms and potential for increased international scrutiny, we do not anticipate a radical shift in government policy in the near future.
Major Forecast Changes
We expect the budget deficit to fall to 3.9% in 2019 and 3.0% in 2020, from an estimated 4.6% in 2018, as the government aims to reduce financing risks.
Laos remains heavily dependent on China as its main export market and source of investment, leaving the country vulnerable at a time of slowing regional growth and higher trade risks.
- Executive Summary
- Core Views
- Major Forecast Changes
- Key Risks
- Country Risk Summary
- Economic Risk Index
- Political Risk Index
- Economic – SWOT Analysis
- Political – SWOT Analysis
- Economic Outlook
- Economic Growth Outlook
- Fiscal Constraints An Emerging Headwind For Laos' Growth
- GDP By Expenditure Outlook
- TABLE: GDP GROWTH FORECASTS
- Outlook On External Position
- TABLE: MAIN EXPORT AND IMPORT PARTNERS
- TABLE: MAIN EXPORTS AND IMPORTS
- TABLE: CURRENT ACCOUNT BALANCE FORECASTS
- Monetary Policy Framework
- TABLE: MONETARY POLICY FORECASTS
- Structural Fiscal Position
- TABLE: MAIN REVENUE AND EXPENDITURE CATEGORIES
- TABLE: FISCAL AND PUBLIC DEBT FORECASTS
- 10-Year Forecast
- The Laotian Economy To 2028
- Structural Weaknesses To Contain Growth Potential
- TABLE: LONG-TERM MACROECONOMIC FORECASTS
- Political Outlook
- Domestic Politics
- Dialogue To Keep Laos-Cambodia Border Tensions In Check
- TABLE: POLITICAL OVERVIEW
- Laos Country Risk Q4 2019THIS COMMENTARY IS PUBLISHED BY FITCH SOLUTIONS MACRO RESEARCH and is NOT a comment on Fitch Ratings’ Credit Rating. Any comments or data included in the report is solely derived from Fitch Solutions Macro Research and independent sources. Fitch Ratings’ analysts do not share data or information with Fitch Solutions Macro Research.ContentsLong-Term Political Outlook
- Low Chance Of Political Liberalisation Over Coming Decade
- Global Macro Outlook
- Potential Policy Missteps Pose The Largest Risk To Global Growth
- TABLE: GLOBAL MACROECONOMIC FORECASTS (2019-2024)
- TABLE: DEVELOPED MARKETS – REAL GDP GROWTH, % y-o-y
- TABLE: EMERGING MARKETS – REAL GDP GROWTH, % y-o-y
- Index Tables
- TABLE: LAOS – MACROECONOMIC DATA AND FORECASTS