Meeting to Report the Implementation Progress of Starting a Business Reform under Prime Minister Order No. 02/PM on Improvement of Regulations and Coordination Mechanism on Doing Business in Lao PDR, dated 01 February 2018.

Vientiane Capital, 24 December 2021. The Department of Enterprise Registration and Management (DERM), Ministry of Industry and Commerce (MoIC) organized a dissemination meeting to report on implementation progress of Starting a Business Reform under Prime Minister Order No. 02/PM on Improvement of Regulations and Coordination Mechanism on Doing Business in Lao PDR, dated 01 February 2018. The meeting was held at Landmark Hotel, and chaired by H.E. PhD. Manothong Vongsay, Deputy Minister of Industry and Commerce. There were approximately 60 participants from line government agencies and private sector representative including Lao National Chamber of Commerce, and Industry (LNCCI) led by Ms. Valy Vesaphong, Vice President of LNCCI, and representatives legal and consulting firms.

In his opening remark, the Deputy Minister, Manothong, addressed the objectives of the meeting and noted the meeting on the implementation of the improvement of business environment in Lao PDR since 2013 with the support from International Finance Corporation (IFC) of the World Bank Group aiming to promote and enhance competitiveness of all levels of enterprise, to ease the procedures required for doing business by line government agencies, to enhance transparency, and to reduce cost and time to facilitate business start-up and operation in Lao PDR.

He then continued to report on Doing Business indicators which were initially supported by the International Finance Corporation and the recent Lao Competitiveness and Trade Project (LCTP), a multi-donor project funed by the World Bank Group, Australia Aid, Irish Aid, USAID, aiming to improve selected indicator-specific including: Indicator 1-Start a Business; Indicator 2-Dealing with Construction Permits; Indicator 3- Getting Electricity and Indicator 8-Trading Across Border, respectively. From review and assessment of reform implementation, findings revealed that environment of Doing Business in Lao PDR has not been improved as expected with the following ranking observed for the past few years: 139th in 2015, 136th in 2016, 139th in 2017, 141th in 2018 and 154th in 2019.

In response and as part of the Government’s Business Environment Reform effort, The Prime Minister Order No. 02/PM was issued on 1st February 2018, on Improvement of Regulations and Coordination Mechanism on Doing Busines in Lao PDR. The document enforced concerned authorities to improve Doing Business’s Indicator-specific within their responsibilities to improve the doing business environment in the country that aims to facilitate business start-up and operations, attract foreign direct investment and support domestic production.

In collaboration with line government, authorities including Minister of Finance (Tax Department and State Asset Management Department), Ministry of Public Security, Ministry of Labor and Social Welfare, Ministry of Information and Culture, the Ministry of Industry and Commerce issued Ministerial Decision on Enterprise Registration, No.0023/MoIC in 2019. The decision aims to improve, resolve and eliminate procedures for Starting A Business (SAB) which reduced from 9 procedures with the average time for 173 days to 3 procedures with the average time for 17 days: 1. Enterprise Registration (10 working days); 2. Seal Registration and Permit (5 working days); and 3. Social Welfare Registration (2 working days).

Following by the opening remarks, the presentations were made on revealing the current procedures to start a business by line agencies including Department of Enterprise Registration and Management, Tax Department, Department 203 from Ministry of Public Security and the representatives from Ministry of Labor and Social Welfare to ensure consistent practice being implemented. According to the public sector, certain procedures have been eliminated; however, the World Bank Group acknowledged only two (02) reforms from among several reform updates memorandum reported by the SAB Reform Task Force Committee on recent improvements which includes: Enterprise Registration (reduction in time) and combining Seal Registration and its Usage Permit into a single process. Therefore, Starting A Business in Lao PDR remains 8 procedures referring to the World Bank Group recent assessment and has not been reduced to 3 procedures as reported by line agencies. This meeting is very essential to harmonize understanding of public and private sectors from central to local levels, particularly the importance of consistent implementation of reformed procedures and practices on ground that will be felt by the private sector.

Lao Competitiveness and Trade (LCT) project is a multi-donor project funded by the World Bank Group, Australian Aid, Irish Aid, and USAID, which implementing at the Department of Planning and Cooperation, Ministry of Industry and Commerce. LCT project aims to eliminate the barriers to private sector-led growth by improving the regulatory environment, lowering trade costs and raising firm-level competitiveness.