The government has approved two prime ministerial decrees, which will allow private companies to build special economic zones in the north of Laos.
The decrees on the management of special economic zones in Bokeo and Luang Namtha provinces were adopted at the monthly government meeting held on November 23 and 24 in Vientiane, according to the Government Spokesman.
Speaking at a press conference on Wednesday, Prof. Dr Boviengkham Vongdara said the Boten and Golden Triangle special economic zones were different from the Savan-Xeno Special Economic Zone in the central province of Savannakhet and therefore required specific decrees to manage the zones.
The Boten and Golden Triangle special economic zones are based on investments by private companies while the Savan-Xeno Special Economic Zone is an investment by the government, he said.
Investment officials said the new decrees aim to help developers to attract foreign investment into these areas more easily.
They said zone developers would have the right to charge companies a fee for investing in these zones. In the Savan-Xeno Special Economic Zone, it is the government that has the right to charge fees.
National Assembly member for Bokeo province, Ms Thatsadaphone Nosing, said although the government was allowing private companies to develop the special economic zones, zone administrators would be bound by Lao laws.
She said zone developers would have the right to design construction of the approved zone only, while the maintenance of security and the import and export of goods and manpower would fall under government management.
She said the government and zone developers had agreed to develop zones based on the principle that it would bring positive development for local people with increasing opportunities for jobs and income.
“According to an economic feasibility study, the zone developers will prioritise local people,” she told journalists during the 8th Session of the 6th Legislature of the Lao National Assembly.
However, she said a major challenge was the ability of Lao people to work in these zones because of their lack of skills.
She said zone developers would have to import workers in accordance with the Labour Law. This law allows foreign investors to import only a small percentage of the total workforce needed by a business unit.
Ms Thatsadaphone said the Golden Triangle Special Economic Zone in Bokeo province was given the right to develop an area of about 800 hectares.
The zone would accommodate all forms of business, including tourism, agriculture and the processing industry.
She said zone developers had invested a large amount in building infrastructure, including an embankment along the Mekong River to prevent erosion.
The government sets up special economic zones to encourage foreign companies to invest in Laos as part of efforts to create jobs and income for Lao people. Such zones are attractive to businesses because they offer a number of investment incentives compared to normal areas of investment.
Investment incentives in special economic zones include import tax reduction and long-term tax exemptions.
By Vientiane Times Reporters
November 27, 2009
