Inflation in Laos grows by 2.44 per cent in July
VIENTIANE (Vientiane Times/ANN) - The Lao Consumer Price Index (CPI) continued to grow in July, with many people calling on the authorities to intervene and take steps to stem the rising inflation rate.
The latest figures posted by the Bank of the Lao PDR on its website show that the Consumer Price Index climbed to 104.9 points in July, up from 104.2 in June and 103.88 in May.
The month-on-month change in the price of goods and services nationwide has led to the July inflation rate of 2.44 percent, up from the June rate of 2.18 percent and 1.97 percent in May, according to the bank, which cited the Lao National Statistics Bureau as a reference.
In January the inflation rate stood at just 0.95 percent, rising to 1.75 percent in February, 1.91 percent in March and 1.88 percent in April.
Based on the bank’s data, it is clear that the inflation rate has continued to increase over the past few months. If this trend continues without interruption, Lao people, in particular those on low incomes, will suffer from the rising cost of living.
Although the Bank of the Lao PDR does not provide details of what it considers to be the driving forces of this growing inflation rate, the general public is facing hardship due to the rising price of fuel and other imported goods.
They say they want the government to effectively regulate the price of fuel and other consumer products, adding that the cost of living in Laos, especially in the main towns, is higher than in neighbouring countries.
At weekends, a large number of Vientiane residents cross the Mekong River into Thailand to buy consumer goods in neighbouring Nong Khai province, which are perceived to be much cheaper than in Laos.
Prime Minister Thongloun Sisoulith has acknowledged the challenge posed by inflation. At the end of last month, he issued an order to the Bank of the Lao PDR to spearhead a mission to counter the inflation threat.
According to the order, which is also referred to as eight measures to stimulate economic growth, the Bank of the Lao PDR must maintain money supply (M2) at the level approved by the National Assembly.
The bank must also maintain the difference between the official and market currency exchange rates at less than 2 percent.
In addition, the central bank must increase foreign currency reserves by facilitating and supporting the production of goods for export and promoting money transactions via the banking system.
The prime minister also ordered the Bank of the Lao PDR to adjust deposit and lending bank rates so they are more relevant to the realities of market affordability. The bank must also develop the capital market so that more investment funding becomes available.