2024-05-19-世界银行-老挝人民民主共和国经济监测_2024年4月_加速改革促进增长-主题部分_教育促进增长和发展（英）_56页_1mb

Lao PDR Economic Monitor Summary (April 2024)

Executive Summary Key Points

Part A: Recent Economic Developments and Outlook

• Economic Growth: Estimated at 3.7% in 2023, below pre-pandemic levels. Protracted macroeconomic instability remains a primary constraint, with policies and reforms progressing slowly. The projected growth for 2024 is 4.0%, though capacity to reach potential growth is hindered by structural constraints, limited investments in human capital, labor shortages, and slow reform implementation.

• Inflation: Consumer prices rose by 31% in 2023, averaging 25% from August 2023 to March 2024. Deflationary overshoots were reduced gradually, but external pressures and weakened exchange rates continue to drive high domestic prices, worsening living costs.

• Fiscal Situation: Primary balance improved to 1.5% of GDP in 2023, yet overall fiscal deficit stood at -0.2% (including interest payments). Revenue reforms are expected to gradually increase revenue collection, but fiscal space remains limited by elevated debt repayments. Gross financing needs are projected at nearly 9% of GDP in 2024.

• External and Financial Pressures: Public debt ratios remain unsustainably high, with total PPG debt estimated at over 110% of GDP. The current account deficit is forecast at 2.9% of GDP in 2024, while continued depreciation of the kip fuels inflation and undercuts external balances.

Part B: Education for Growth and Development

• Human Capital: Education underpins long-term economic growth, but foundational skills are weak, as learning outcomes for Grade 5 students lag behind regional peers.

• Current Challenges: Enrolment rates declined across education levels due to economic pressures, high dropout rates, and intensified learning poverty. Teacher training and pedagogical skills are inadequate, as most are overestimating their classroom performance.

• Funding Shortfall: Public education spending decreased by nearly 38% in real terms since 2013. Teacher allocation is imbalanced, and operational spending cuts have significantly hampered the quality of teaching and learning.

• Outlook: Improving learning outcomes will require strengthening complementary public investments, real prioritization of human capital, accelerating tax reforms, and deploying innovative teaching technologies.

Key Indicators