Lao PDR

Millennium Development Goal 1

Eradicate Poverty & Hunger

Poverty in Lao PDR declined steadily from 46 percent in 1992 to 27 percent in 2008 and the country is on course to attain the MDG target of halving poverty by 2015.

However while overall poverty has declined, and the poor are getting less poor on average, regional disparities as well as consumption inequalities across population groups have increased.

Food poverty declined faster than overall poverty between 1992-93 and 2002-03, and the average number of months without sufficient rice in villages dropped between 1997-98 and 2002-03. But in areas affected by unexploded ordnance (UXO), the incidence of poverty and food insecurity is particularly high - 41 out of the 46 poorest districts in Lao PDR are affected by UXO contamination.

Malnutrition also remains a significant concern in Lao PDR. Estimates suggest that despite considerable efforts, 37 percent of children younger than five years of age are underweight. Chronic malnutrition, or stunting, is a major issue, affecting 40 percent of children under five, and requires urgent attention by both Government and the development community.

Poverty reduction alone is not sufficient to meet the targets on reducing malnutrition. In other words, poverty reduction will not automatically result in an improved nutrient dietary intake. An urgent need exists for inter-sectoral policies to address both malnutrition and poverty in a comprehensive way. In response to this need, an inter-sectoral Nutrition Policy is being set up, which acknowledges that nutrition is central in development. A multi-donor effort entitled REACH is also working to alleviate child hunger through complementary feeding programmes, treatment of acute malnutrition and by increasing household food security.

The economy has grown considerably in the last two decades with an 8 percent growth rate fueled by exports, tourism, copper, hydropower, logging and overseas remittances. Despite the growth in the non-agricultural sectors, skills based job opportunities have not increased in equal measure. As a result, the overall structure of the workforce has not changed, with around 80 percent of workers still engaged in subsistence-oriented agriculture and associated activities.

Following the widespread conviction that poverty can only be reduced if people have a decent and productive job, a new target on employment was added under MDG 1 in 2006: Reaching full and productive employment and decent work for all, including women and young people.

Meeting the targets: Economic growth is necessary, but not sufficient for poverty reduction. To continue to achieve significant reductions in poverty, Lao PDR needs to diversify its economy and give further attention to strengthening the agricultural and manufacturing sectors. This will allow for more broad based and equitable growth and skills development. Additionally, attention must be given to the development of rural infrastructure and improved opportunities and wages of the unskilled workers.

Lao PDR has the potential for high rates of sustainable agricultural growth that are keys to the continued reduction of rural poverty; aiming for a rate of 5 to 6 percent in the next decade is reasonable. Achieving this will involve transitioning from reliance on extensive growth to a future that will depend more on intensive sources of growth.

See indicators for MDG 1

Watch a video on food security in Laos (YouTube)

Watch a video on UXO in Laos (YouTube) - presence of UXO and prevalence of poverty are linked