Overview of Australia’s aid program to Laos
2013/14 Estimated Outcome: $52.4 million
2014/15 Budget Estimate: $55.6 million
Australia is one of the largest bilateral donors to Lao PDR, and we work in areas critical to Laos’ long-term development and economic growth, including trade and investment reform, education and rural development. Australia’s support will help Laos continue to develop as a stable, well-managed and increasingly prosperous regional neighbour with growing economic links with Australia and the region.
Laos is making steady progress in reducing poverty but remains one of the poorest countries in the Mekong region. Like its neighbours, Laos is achieving strong growth, particularly in urban areas, driven by a wide-ranging reform agenda, demand for natural resources and its transition to a market economy. Despite the economic and social gains, poverty is widespread and its causes are increasingly complex. Around 23 per cent of the population live under the national poverty line. Twenty seven per cent of children under five are underweight and 44 per cent have stunted growth.
Australia has been a key partner in Laos’ development over the last 60 years. Our support is guided by the Australia-Laos Development Cooperation Strategy 2009-15. We work in partnership with multilateral development agencies, other donors, the private sector and civil society organisations.
Education and skills development
Supporting better education outcomes, particularly in basic education, is fundamental to development in Laos. Education is the flagship of Australia’s development cooperation partnership with the Lao PDR. Australia delivers support in partnership with multilateral development agencies and other donors to build schools, train teachers, strengthen school management, provide learning resources and school-based feeding programs.
The Government of Laos has placed priority on building its human resource capacity to address existing skills gaps to sustain social development and economic growth. Australia supports human resource development in Laos at the individual and institutional level to address existing shortages in skilled labour and to improve the delivery of basic services.
More information on education and skills development in Laos
The extent to which Laos can facilitate and sustain private sector growth will increasingly determine its success in development and reducing poverty. Australia is supporting private sector growth and opportunities for small- and medium-sized enterprises through improving the trade and investment environment. We continue to support Laos’ integration into the regional and multilateral trading system, and we are working to address some of the policy and institutional impediments to trade and investment in sectors identified as having the ability to promote inclusive growth.
Around 80 per cent of poor people in Laos live in rural areas. Australia works to improve rural economic development by focusing on improving livelihoods and food security through access to savings and credit services, social transfers, and micro-enterprise support. We also improve access to markets and basic services through support for rural infrastructure such as road access, irrigation and dams, water supply and sanitation and other productive infrastructure.
In addition to our bilateral program, Laos also benefits from Australia’s regional investments. For further information, refer to the East Asia Regional page.
More information on economic development in Laos
Results for 2013-14
Education and skills development:
- Construction of 393 classrooms in 81 primary schools
- Training provided to 487 school principals, 2,343 teachers and 1.043 Village Education Development Committee members
- Provision of nutritious school meals to 50,172 students (24,082 girls) living in the most food insecure districts
- Provided a total of 50 long-term Australia Awards
- 70 scholarships were granted to students from disadvantaged backgrounds to study at a Lao university.
Economic development through trade facilitation and rural development:
- Established a business assistance facility to help Lao businesses develop export growth plans
- Services trade regulatory assessment commenced which will identify measures to support services trade growth
- More than 9,500 people increased their production of and access to food due to rice banks and irrigation systems
- 10,989 additional people have increased access to financial services
- 877 hectares of land cleared of unexploded ordnance and released benefiting more than 70,000 people.
Economic development in Laos
Australia is supporting economic growth and poverty reduction in Laos through a range of rural development and trade and business facilitation activities.
Australia continues to focus its development assistance on rural and remote areas where poverty is concentrated. We support community-driven aid investments that tackle key constraints to rural economic development and improve livelihoods and incomes for thousands of rural poor. Our programs support micro-enterprises, clearance of unexploded ordnance, savings and, micro-credit services availability, social protection approaches and infrastructure provision.
Australia will continue to support the Government of Laos’ trade facilitation and integration agenda to improve private enterprise opportunities and contribute to incomes and employment generation. Australia is supporting the Government of Lao PDR to improve regulatory simplification and transparency for business, including establishment of an electronic trade portal which will publish in one place all import and export related laws, regulations and procedures. Australia is also supporting Lao businesses develop growth plans, including those owned and managed by female entrepreneurs.
Read the Australia Laos Rural Development Delivery Strategy 2012-16
4Poverty Reduction Fund Phase 2
$21 million, 2011-2017
Poverty is concentrated in rural and remote areas, where poor infrastructure and limited or no access to basic services and markets is a major obstacle to economic growth. Australia is supporting the Poverty Reduction Fund Phase II, a community-based construction initiative that is improving poor communities’ access to markets and essential services. Infrastructure support includes rural road access, water supply and sanitation, irrigation and dams, markets, schools, dispensaries and other small productive infrastructure.
Laos-Australia NGO Cooperation Agreements (LANGOCA)
$14 million, 2006-2014
Australia is a longstanding supporter of non-government organisations (NGOs) in Laos. Australia is working with NGOs in the poorest parts of the country to reduce the vulnerability of poor communities. To reduce the impact of disasters and unexploded ordnance (UXO), Australia is clearing land, helping communities to better plan for and respond to disasters, as well as to improve productivity of their land and increase access to clean water and basic sanitation. Our agreements with NGOs have also enabled humanitarian emergency responses natural disasters. Australia has cooperation agreements with CARE, Oxfam, Save the Children Australia and World Vision.
Laos–Australia Rural Livelihoods Program
$43 million, 2012-2016
The Laos Australia Rural Livelihoods Program focuses on three closely complementary areas that underpin strategies to deliver economic security and resilience to poor families: income generation, social protection and financial inclusion. The Program aims to improve the economic security of poor people in rural Laos through a range of interventions, including activities to: clear arable land of unexploded ordnance, provide short-term cash transfers to cover food and basic necessities and support household businesses (such as retail shops, food vending, livestock raising) grow, and build financial services so that rural people can borrow money and safely store their savings.
Second Trade Development Facility
$5 million, 2013-2017
Australia is supporting Laos to sustain poverty reduction and economic growth through trade and integration with the regional and global economies. Australia’s contributions to the Second Trade Development Facility (TDFII) – a World Bank-led multi-donor trust fund – support:
- Trade facilitation, trade policy, and regulations: TDFII consists of a number of inter-related activities aimed at improving transparency, predictability and lowering associated compliance costs for traders. Activities will focus primarily on improving inter-agency coordination and supporting the adoption of modern risk based approaches to managing regulatory compliance in non-customs agencies, including reform of non-tariff measures.
- Diversification and competitiveness: TDFII includes activities aiming to improve private sector productivity and capacity to compete in international markets, focusing on the non-natural resources sectors (in particular outside of mining and hydropower). Activities will facilitate the more effective participation of small and medium sized enterprises in the economy, enhance skills and labour standards in the manufacturing sector and support women's economic empowerment.
- Mainstreaming aid for trade: TDFII will further strengthen Lao PDR's 'aid-for-trade' governance framework. This will involve strengthening a national aid-for-trade coordination unit and supporting smaller-scale demand-driven trade reform activities across the government.
Education and skills development in Laos
The Government of Lao PDR has placed priority on building its human resource capacity to address existing skills gaps to sustain social development and economic growth and support new enterprise. Basic education is the flagship of Australia’s development cooperation partnership with the Lao PDR. Australia also supports human resource development in Lao PDR at the individual and institutional level to address existing shortages in skilled labour and to improve basic service delivery.
Australia is the largest bilateral donor to the basic education sub-sector in Lao PDR. We deliver our support in partnership with the Lao Government, multilateral development agencies and other donors to build schools, train teachers, strengthen school management, provide learning resources and provide school feeding. Our investments are helping to strengthen national-level management of the education system through the development and implementation of a jointly agreed Education Sector Development Framework governing the efficient and effective allocation of resources. Australia contributes to sector policy dialogue and aid coordination by co-chairing the Education Sector Working Group, and providing advisory support to the Lao Ministry of Education and Sports. Australia’s engagement and investment in basic education aim to ensure that high net enrolment rates are sustained, primary school completion rates improve and more students, especially those experiencing disadvantage, are numerate, literate and have life skills enabling them to lead productive lives.
Read the Australia-Laos Education Delivery Strategy 2013-18
Basic Education Quality and Access in Laos (BEQUAL) Program
$86 million, 2014-2018
Australia’s flagship intervention in the education sector, the Basic Education Quality and Access in Laos (BEQUAL) program, will be delivered in 65 of the most educationally disadvantaged districts in Laos. It aims to increase student participation, improve learning environments and improve teacher quality. BEQUAL will assist an estimated 450,000 children go to school and stay in school, with a particular focus on the most educationally disadvantaged—girls, students with disabilities and children from ethnic minority groups. Teachers and teacher training institutions will be assisted to improve the quality of the education they delivery, including through training 520 people (360 women) from ethnic minority groups to become teachers in their communities. Teaching and learning environments will be improved through the construction or rehabilitation of 300 schools.
Education for All—Fast Track Initiative in Laos
$21 million, 2011-2014
Australia has been helping to improve access to quality basic education in Laos through the Education for All—Fast Track Initiative (EFA-FTI). Australia has contributed $21 million to EFA-FTI from 2010 to 2014 for school construction, in-service teacher training, training school principals and making education more accessible through mobile teachers. The US$65.5 million program is a partnership between Australia, the Global Partnership for Education (GPE) and the World Bank. It is being implemented in pre-primary and primary schools in 56 of the country’s most educationally disadvantaged districts, and is the largest basic education program ever to be implemented through Lao Government systems.
Key achievements of EFA-FTI include: an increase in the number of complete schools (offering all five grades) in target districts, from 40 per cent in 2008-9 to 73 per cent in 2013-14 and that Net Enrolment Rates in target districts increased from 81 per cent (79 per cent for girls) in 2008-09 to 96 per cent (95 per cent for girls) in 2013-14.
Lao PDR Basic Education Water, Sanitation and Hygiene (WASH) and School Meals Program
$20.5 million, 2013-2017
The Lao PDR Basic Education Water, Sanitation and Hygiene (WASH) and School Meals Program aims to improve access to basic education in Laos by promoting students’ participation and learning. The establishment of water and sanitation facilities complement community-based constriction under the Education for All—Fast Track Initiative; and the provision of daily school meals complement the Lao Ministry of Education and Sports’ pilot National School Meals Program. Through UNICEF, Australia is providing water and sanitation facilities and hygiene education to all schools being constructed under the EFA-FTI program in 42 of the most educationally disadvantaged districts. This is directly benefiting 50,000 girls and boys and around 24,000 people living in communities in which schools receive a water supply. Through the World Food Programme, Australia is also contributing to the provision of school meals in the most food insecure districts in six provinces to ensure that approximately 66,000 pre-primary and primary students in target districts receive daily school meals.
$20 million; 2014-2017
The Laos-Australia Institute is Australia’s principal investment in human resource development in Lao PDR. It offers targeted scholarships and professional development training opportunities for government, civil society and the private sector in priority areas that align with Australia’s aid program and complement existing and planned aid investments in basic education, trade facilitation, rural development and water resource management.
The Laos-Australia Institute aims to strengthen public sector and civil society capacity in key ministries and organisations such as the Ministry of Education and Sports, the Ministry of Home Affairs, the National Commission for the Advancement of Women (NCAW), and the Lao Disabled People’s Association. The Institute’s program includes: working with partner organisations to undertake training needs analysis and human resource planning; facilitating institutional linkages; and providing targeted training (including English-language training), technical assistance and professional development opportunities. Institute activities comprise policy development and application, and by assisting policy makers and planners, the Institute also aims to improve the quality of services provided by priority national and provincial organisations. The Institute has a strong focus on targeting women and people with disabilities through scholarships and professional development training to improve their participation in leadership and management. The Institute also aims to strengthen participant networks, including Awards alumni and organisational linkages.
The Institute manages a suite of scholarship programs including the highly successful Australia Awards and the Laos-Australia National Scholarships (LANS) programs and the new Government of Laos Professional English Language Training (GOLPET) program.
The Australia Awards program (a further $20 million over 2014-17) aims to enhance the leadership, knowledge and technical skills by providing study and professional development opportunities to future Lao leaders. The LANS program supports students from disadvantaged backgrounds to complete a Bachelor’s degree at a Lao public university. The GOLPET program aims to build English language proficiency skills of public officials, enhance the professional capacity of the Government of Laos’ English language training staff and strengthen a peer network of English language trainers.