Economy

Laos is one of Asia's poorest nations. Agriculture employs most of the Laotian workforce and accounts for over 50% of its gross domestic product. Rice is by far the chief crop; corn, sweet potatoes, and vegetables are also grown. Commercial crops include coffee, tobacco, sugarcane, and cotton. Illegal opium and cannabis were long produced in a northwest region bordering Thailand and Myanmar, part of the “Golden Triangle,” but production there was largely eradicated by 2005. Fish from the rivers supplement the diet. Forests cover over half of the country; teak is cut and lac is extracted, but poor transportation and the lack of industry limit production. Copper and gold, tin, and gypsum are mined; other mineral resources include gemstones. Manufacturing is limited; textiles and garments are the most important products. Tourism has become increasingly significant in the 21st cent, providing service jobs for Laotians.

Laos also has a massive hydroelectric potential and, despite a relative lack of development, electricity is a prime export, mainly to Thailand. The other principal exports of Laos are textiles and garments, timber and wood products, coffee, and tin. Since most manufactured items have to be imported, there is a continuing foreign trade deficit. Leading trade partners are Thailand, Vietnam, and Japan. In an attempt to expand the nation's economy, a foreign investment law was passed in 1989; the statute was further liberalized in 1994.

The Columbia Electronic Encyclopedia, 6th ed. Copyright © 2007, Columbia University Press. All rights reserved.

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