 | Lao PDR |
INVESTMENT PRESENTATION
THE PROPOSAL
In Lao PDR, the Hand-in-Hand initiative is supporting investments in several agro-industries located around the Lao-China railway. Additionally with the initiative, investments are being linked to sustainable development goals, national planning, and budgetary processes.
Poverty
Potential
Efficiency
COMMODITIES AND INTERVENTIONS
Timber and timber products
With high opportunities and a growing global demand for timber and its related products free of deforestation, investments are focusing on promoting agro forestry on degraded and deforested land. The government’s target is to restore hectares aiming at 70% of forest cover through promotion of land concession, land lease and contract farming. Investments by the private sector are being raised for concessional land lease from the central government of 60,000 hectares for 30 years, to grow several species under poly-cropping. The cost is 157 million with an IRR of 17% impacting more than 5 thousand farmers.
Cardamom
Cardamom has been prioritized by the national government due to its high international demand and it is stated as one of the priority products in the ADS 2025 and Vision 2030 and the National Plan of Action on Nutrition (2021-2025). With a value chain approach, production will take place in 16,000 hectares in a tripartite lease with the local government, farmers organizations and the investor. Also, infrastructure will be developed for drying, storage and packaging. The goal is to export to regional and global markets via China and Thailand using Lao-China Railways.
The investment required is of 10.4 million USD with an IRR of 12%, benefiting more than 15 thousand producers and sequestering 176 thousand tons of CO2.
Tea
In order to promote exports, tea is being considered as an export commodity in the northern provinces, where 83% if tea (16 000MT) is grown in the Phongsaly and Luang Namtha provinces. Tea has an enormous scope for expansion with 2.4 million hectares suitable, Lao tea is organic and has a high export value.
Investments are being sought to lease 1,000 hectares in a tripartite lease agreement between local government, farmers organizations, and investor to grow Organic and Geographical Indicatios teas. Additionally, it is planned the development of infrastructure for processing, storage, and packaging. The investment cost is 10 million USD with and IRR of 11.8% benefiting 2,428 farmers.