KUALA LUMPUR - The Lao government has set a target of at least 6% economic growth in 2026, driven by fiscal reforms, large infrastructure projects and preparations for national elections.

Government Spokesperson Sonexay Sitphaxay announced the target on January 13 after the Second Enlarged Government Meeting held over two days.

A key focus for 2026 is strengthening public finances, with authorities aiming to raise state revenue to at least 20 percent of Gross Domestic Product through modernised tax and revenue collection systems.

Officials said these measures are designed to close tax gaps, improve compliance and increase efficiency.

Controlling inflation remains a priority after consumer price growth eased from 31.23% in 2023 to 23.13% in 2024 and further to 7.7% in 2025.

The government is also taking steps to stabilise the exchange rate, strengthen the Lao kip and increase the use of local currency in regional trade.

Alongside fiscal reforms, infrastructure development is being prioritised as a long-term driver of economic growth and regional integration.

Several major projects have been approved or are entering early stages, including Phase One of the Laos - Vietnam railway linking Thakhek district to the border in Khammouane province.

The railway is expected to complement existing rail links with China and Thailand, while plans are also underway for a second Mekong River bridge connecting Vientiane with Thailand’s Nong Khai province.

These infrastructure efforts are expected to create significant employment and skills development opportunities. 

Related rail projects in the region are set to train tens of thousands of workers and specialists for construction, operations, and maintenance, as part of broader efforts to strengthen the local workforce and regional connectivity.

Energy development remains another pillar of the growth strategy, supporting domestic needs and electricity exports to neighbouring countries.

Laos continues to attract investment in clean energy, highlighted by the opening of a 1,000 megawatt solar power plant in Oudomxay province in December 2025, the largest in the country so far.

At the same time, the government is preparing for elections to the 10th National Assembly on Feb 22 and continuing efforts to graduate from least developed country status in 2026.

Under the 10th Five-Year National Socio-Economic Development Plan for 2026 until 2030, Laos aims to maintain average annual growth of at least six percent, with GDP per capita projected to reach USD3,104 by 2030.