Lao’s economic growth has been rapid in recent years boosted in part by the country’s vast natural resources. Currently agriculture and forestry accounts for nearly 28% of Lao GDP with agricultural productivity set to improve over the next two years. However, just like Cambodia and Myanmar, agricultural lending in Lao is primarily based against collateral leading to constraints within the agricultural sector.
Through Acleda Lao this project will enhance lending in key sectors in need of affordable financial support to increase employment, enhance export earnings, and maintain food security. Through this project, Acleda Lao’s SME loan portfolio is expected to increase to $132 million from $45 million. In addition, the micro loan portfolio is expected to increase to $104 million from $35 million.