New roadmap for Lao PDR to promote sustainable production and exports of wood products

The Lao PDR’s Wood Processing Sector Export Roadmap presents the workplan for Laos’ exports with value-added wood products, based on three strategic objectives:

(1) Improve the sector's sustainability through better coordination, and increase access to legal timber; (2) Stimulate product diversification and enhance skills and processing capacities, fostering technology adoption, and spurring investment; and  (3) Enhance the sector's ability to create and sustain market linkages.

Lao PDR is rich in natural and planted forest resources, offering market opportunities in the region and globally. Teak and rosewood are considered valuable in international markets. The country has a small, but vibrant wood processing industry, with the potential to increase jobs in the rural areas, thus generating more income and driving the country’s economy.  

Nevertheless, processed wood remains a low-value-added product in Lao PDR. Moreover, the country increasingly faces regional competition, leaving the industry with only a few regional markets to access (mainly China and Viet Nam).

Additionally, the impact of the COVID-19 pandemic is projected to decrease global consumption, setting back the supply due to factory shutdowns and logistical challenges.

To address these challenges and find solutions, the Lao PDR Ministry of Industry and Commerce, in close collaboration with the Ministry of Agriculture and Forestry, developed the new roadmap based on a series of contributions from industry leaders, small business owners, institutions, and public-sector representatives.

The detailed action plan highlights the strong coordination between the public and private-sector stakeholders. The wood-processing sector steering committee will coordinate activities, monitor progress and mobilize resources to implement the roadmap.

The International Trade Centre technically assisted the roadmap’s development process as part of the ASEAN Regional Integration Support from the European Union (Arise Plus Lao PDR), an EU-funded initiative focusing on promoting inclusive economic growth, climate change resilience, mitigating vulnerability and job creation in the country.

The roadmap also catalyses the UN-REDD Programme support to promote legal and sustainable forest products trade in the Lower Mekong region as well as Lao PDR’s on-going efforts towards a Voluntary Partnership Agreement with the EU in Forest Law Enforcement, Governance and Trade (FLEGT) initiative.

“The PDR’s Wood Processing Sector Export Roadmap 2021-2025 will complement national policies and measures, aiming to promote industry and trade development 2021-2025. The 9th National Socio-Economic Development Plan 2021-2025 identifies wood processing as one of the key priority sectors to be promoted to enable business to develop products with higher value-added and better quality in order to reduce export of raw materials and semi-processed products, while promoting environmental and social sustainable industry and transforming into modernized industry 4.0 ”. H.E. Khampheng Xaysompheng, Minister of Industry and Commerce.

“This roadmap offers a holistic approach – from planting forests to processing and exporting quality and value-added wood products. It is vital that the products are diversified and meet the international standards, in order to increase domestic capacities and competitiveness. While adjusting to the ‘new normal’ in the Covid-19 era in the country and around the world - through adopting the new technology and increasing the use of e-commerce.” H.E Thongphat Vongmany, Deputy Minister of Agricultural and Forestry

“This roadmap will help to tackle challenges and open new important markets, building on the opportunities and development potential for this sector. The EU and its member states are proud to take an active role to contribute to this objective, side-by-side with the Lao PDR’s authorities, in view of the foreseen graduation from the Least Developed Country status in the near future.” H.E. Ina Marčiulionytė, Ambassador of the European Union to Lao PDR

“More than a plan, the Roadmap is a living document for action. Today, this launch event represents the successful completion of the design stage of the roadmap and the beginning of the implementation phase. We at ITC are proud to have been assisting in the achievement of this important milestone, which was developed under the umbrella of the EU ARISE Plus – Lao PDR project.” Dorothy Ng'ambi Tembo, Deputy Executive Director, International Trade Centre

About Arise Plus Lao PDR: The ASEAN Regional Integration Support – Lao PDR Trade-Related Assistance project (ARISE Plus Lao PDR) is funded by the European Union (EU). It aims to contribute to inclusive economic growth, increased climate change resilience, mitigation of vulnerability and job creation in Lao PDR.

Find us online: https://www.intracen.org/arise-plus-laos/ | https://www.facebook.com/groups/ariseplus/

About ITC - The International Trade Centre is the joint agency of the World Trade Organization and the United Nations. ITC assists small and medium-sized enterprises in developing and transition economies to become more competitive in global markets, thereby contributing to sustainable economic development within the frameworks of the Aid-for-Trade agenda and the United Nations’ Sustainable Development Goals.

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