Vientiane authorities expect to receive funding of around 160 billion kip (US$20 million) next fiscal year, allowing them to finance 679 planned state investment projects. The Vientiane Planning and Investment Department unveiled a draft of its socio-economic development plan for 2012/2013 recently, showing that the capital city will submit a proposal to the government to approve its 679 state investment projects next fiscal year, which begins in October.
Combined, the state investment projects will require funds of around 160 billion kip (US$20 million) to complete, the annual socio-economic development plan of the capital highlights.
The Vientiane authorities say that they expect to mobilise about 117 billion kip (US$14 million) from domestic revenue sources including the government budget, while the rest of the funds will come from foreign development partners in the form of grant and soft loans.
About 35 percent of the proposed funds will be spent to implement projects in the social sector, including 17 percent for education and 9 percent for health, in an effort to ensure that the capital city will be able to achieve the UN millennium development goals in 2015.
About 30 percent of the funds will be spent on projects in the economic sector, including basic infrastructure for agriculture, to ensure increased rice cultivation and cash crop production next fiscal year.
A number of irrigation networks and associated agricultural infrastructure were damaged due to flooding caused by tropical storms at the beginning of the year. As a result, Vientiane expects to produce only around 17,400 tonnes of rice this year, which represents a fall of around 7.5 percent compared to the previous year.
Vientiane capital also plans to improve basic infrastructure, which will help create favourable conditions for the industry and services sector, which is one of the main driving forces of the capital’s current economic growth.
Growth in the Vientiane economy will remain at about 12 percent this fiscal year. The largest contributor to the Vientiane economy is industry, which is forecast to see about 15.4 percent growth, accounting for 45.6 percent of the capital’s GDP value.
The second driving force in the Vientiane economy is the service sector, which accounts for 34.3 percent of the capital’s GDP, and is forecast to see 9.9 percent GDP growth.
The Vientiane Planning and Investment Department says state investment projects in road construction and real estate projects such as state buildings will account for 35 percent of the total funds, with 28 percent for road construction and 7 percent for real estate projects.
Vientiane is currently accelerating a number of road constructions projects as part of preparation efforts to host the 9th Asia-Europe Summit and related meetings at the end of this year.
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