Tuesday, June 13, 2017
Lao and Vietnamese cooperation in infrastructure development and Laos's prospects as an inland trade hub.
Laos's government announced on May 25 that it is considering creating a public-private joint stock company to facilitate links with Vietnamese partners as both countries cooperate to develop the Vung Ang port. Proceeding with the project signals a renewed attempt to make Laos land-linked, rather than landlocked.
- Laos's leaders face a challenge encouraging neighbours to use the Vung Ang port.
- Laos-oriented trade alone will be insufficient to make the port commercially viable.
- In coming years, no major economic benefit for Laos directly stemming from the Vung Ang project is likely.
- War-era unexploded ordnance may slow construction of the Vung Ang rail link.
- Absent adequate private capital, sovereign debt could be required for the Vung Ang project, problematic for debt-burdened Laos.