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Rural poverty in Lao People's Democratic Republic

The high growth rate achieved by the Lao People’s Democratic Republic since the introduction of economic reforms in the mid-1980s has resulted in a steady decline in poverty. Lao PDR has made impressive progress in economic growth, with the proportion of poor people falling from 39 per cent of the population in the mid-1990s to 27.6 per cent in 2010.

According to UNDP’s Human Development Report 2010, Lao PDR is one of the 10 “top movers” in the world in terms of progress on human development over the past 20 years. However, the country remains one of the poorest and least developed in Southeast Asia. Although social indicators have also shown an improvement, they are still among the lowest in the region.

Lao PDR is also more rural in character than any other country in Southeast Asia. More than three quarters of the total population lives in rural areas and depends on agriculture and natural resources for survival. Poverty is particularly concentrated in these areas. While agriculture is the mainstay of the economy, farming is largely practised at the subsistence level, and productive conditions for farmers are generally poor.

Poverty and extreme poverty are most common in mountainous regions, where the majority of Lao PDR’s ethnic minority peoples live. In upland areas, the poverty rate is as high as 43 per cent, compared with about 28 per cent in the lowlands. The poorest groups in the lowlands are those who have been resettled from mountain regions.
In general, the most disadvantaged households are located in areas that are vulnerable to natural disasters; have no livestock; include a large number of dependents; and are headed by women.

Women generally work longer hours than men, often taking on about 70 per cent of farming and household tasks, as well as caring for young children. They also receive less schooling. Women’s literacy rate is 54 per cent, compared to 77 per cent for men. Ethnic women and girls, especially those in the highlands, are the most vulnerable members of rural communities. Women in ethnic groups comprise 70 per cent of the illiterate population and suffer further isolation given that so few of them speak the national language.

Poor rural people depend on agriculture for food and income, but agricultural conditions are often unfavourable and productivity is low. Farmers struggle to meet food requirements, especially when their households are large. Most use traditional farming methods. They lack knowledge of new technologies and skills to improve yields, they have few inputs and their landholdings tend to be too small for paddy cultivation or production of other crops.

Declining soil fertility also affects productivity. Few farm households have access to irrigation. Livestock diseases spread unchecked, causing loss of animals.
Because of declining yields of rice and other crops, in many parts of the country households are forced to use wild forest resources to provide food and generate cash. This unregulated exploitation of important natural resources causes serious environmental damage and ultimately exacerbates poverty.

The Government’s programme of opium eradication has been largely successful, but continued investment is required to support the development of sustainable alternatives to the cultivation of opium poppies as a cash crop.

Poor, remote rural communities are also geographically and institutionally isolated. During the rainy seasons as many as half of all Lao villages become unreachable. Social isolation is a particular problem for upland ethnic peoples, who are marginalized in many ways because of their languages, customs and religious beliefs. In addition, rural communities have very limited access to government and financial services, roads, markets, basic education and health services. They are largely cut off from the benefits of a market-oriented economy. And their lack of education prevents them from gaining access to information that would help them improve their living standards and know their rights.
 

Source: IFAD