Laos’ forests may be the key to reducing poverty in the country. The World Bank and the Ministry of Agriculture and Forestry created a new program titled the Lao Landscapes and Livelihood Project. The project, running from 2021 until 2027, seeks to help reduce poverty and kickstart the economy in Laos. The project will cost roughly $57 million and aims to alleviate the economic hardships of the COVID-19 pandemic through the preservation of Laos’ forests.
History of Poverty in Laos
Over the past 30 years, poverty in Laos has decreased dramatically. Poverty went from 46% in 1993 to 18% in 2019, coinciding with rapid growth in GDP. Much of this is a result of farming reform as farmers “moved from subsistence rice cultivation toward the commercial production of cash crops,” increasing income for farmers. However, poverty reduction has recently been slowing down in Laos with a lack of new jobs to drive economic growth and rising inequality.
Additionally, the COVID-19 pandemic is causing even more employment uncertainty. There has also been a sharp decline in tourism due to COVID-19 restrictions and border closures. Workers have to deal with job informality and fluctuations in demand as well. However, remittances, an income source for about 15% of households between 2013 and 2019, contributes to poverty reduction in Laos.
The Role of Forests
There are several ways that the government can ignite poverty reduction, including improving infrastructure and investing in education. However, the Lao Landscapes and Livelihood Project looks toward one of the main sources of income: Laos’ forests.
Much of Laos’ poverty is present in the country’s rural areas, specifically in the central provinces, which are home to an abundance of forests. The main goal of the project is to utilize Laos’ forests to increase investment in sustainable forest management and preserve the country’s “natural capital” while creating employment opportunities that will help reduce poverty. About 70% of Laos is covered in forests and nearly 70% of the population lives in these forest-dense areas. This means that forests can play a key role in igniting economic growth in Laos.
Although the economy improved consistently in the past few decades, Laos’ natural resources have not. The deterioration of natural resources makes “vulnerable rural people more susceptible to floods and droughts while jeopardizing their access to food, fiber, fresh water and income.” This degradation prompts preservation efforts to protect the forests while improving the livelihoods of the people living around them.
Lao Landscapes and Livelihood Project Goals
The project focuses mainly on encouraging economic growth, which slowed during the pandemic. There are three main areas of focus for the project: conservation, tourism and production. Conservation and production relate to new jobs through investment in sustainable practices and facilities. As there is more societal pressure to obtain “good wood,” or environmentally friendly wood production, more companies are willing to invest in sustainable ways of producing wood. Consequently, this may result in nearly 300,000 new jobs in Laos.
Tourism also grows through the protection of the abundant biodiversity in Laos’ forests. Biodiversity is one of the most important, yet quickly disappearing parts of the environment. Therefore, biodiversity protection will not only help the environment but will also attract tourists who wish to see the various plant and animal species that are native to Laos, spurring economic growth.
The Lao Landscapes and Livelihood Project is one part of the 2030 National Green Growth Strategy. The project intends to utilize the forests of Laos to promote economic growth while also reducing poverty by aiding the federal government in passing legislation and designing policies to align with these priorities. The project also prioritizes gender equality, with roughly 50% of the jobs allocated to women. Overall, the project will ultimately help put Laos back on the right track to continued economic growth and reduced poverty.
– Ritika Manathara