Lao PDR has seen a rapid macro-economic growth during the past decade with Gross Domestic Product growing between 7 and 8.5% annually, to a large extent spurred by investments in hydropower, mining and urban construction projects. The Lao Government has also invested heavily in expanding the road network, rural electrification and irrigation schemes in high-potential lowland areas. Official poverty rates have at the same time fallen significantly and private construction and other household investments have accelerated in urban area. However, the economic development has mainly benefitted urban and lowland populations, while progress has been much slower in uplands and mountain areas where the people are increasingly falling behind lowland populations in terms of incomes, education, health, nutrition and other social indicators. This is partly linked to physical isolation, difficult terrain, and low agricultural potentials, but also to limited service capability of government institutions, and to the low political and social capital of most upland communities, mostly ethnic minority groups. Moreover, resource competition, resettlements, environmental degradation and land-use regulations have undermined agricultural productivity, food security and incomes of many people.
The “Local Development Programme for Bokeo, Bolikhamxay, Khammouane and Vientiane Provinces – LAO/030” was conceived to help reduce poverty in the more disadvantaged upland areas of the four target provinces. The Programme will also assist in strengthening local governance, decentralisation and policy dialogue in support of upland development.
The overall objectives are based on three objectives from the National Socio-Economic Development Plan (NSEDP) 2016-2020, which are of particular relevance to the upland development challenge, namely
- Poverty levels in Lao PDR will be reduced;
- Hunger and malnutrition will be reduced; and
- Sustainable environmental management will be secured through better land governance.
These three overall objectives will serve as overall thematic focus areas to guide the LAO/030 practical investments, approaches, capacity strengthening, strategy formulation and policy dialogue.
To help the Lao Government achieve these aims, the LAO/030 specific objective is that the target villages in Bokeo, Bolikhamxay, Khammouane and Vientiane Provinces will have improved living standards and will be over the poverty line by the end of the programme. Results related to the overall and specific objectives will be monitored according to the Lao Government’s NSEDP 2016-2020 Monitoring and Evaluation (M&E) framework, and will be further evaluated as regards the Lao-Luxembourg Indicative Cooperation Programme (ICP) IV, and the European Union Joint Programme (EUJP) for 2016-2020.
The specific objective will be pursued through three main interventions: governance strengthening and capacity development; community-led development work; and socio-economic infrastructure development. The direct village interventions will account for more than 70% of the budget to help attain the poverty reduction targets. To facilitate the village level work and help institutionalize changes, about 20% of the budget will be spent on the governance component, while direct programme management, quality assurance and coordination will require about 10%.
The programme duration is five years, starting in December 2016, with a budget of 14,650,000 EUR plus approximately 3,100,000 EUR from an ongoing project in Khammouane Province. The Lao Government will give in-kind contribution by the participating agencies through national staff, facilities, and ongoing government interventions linked to the programme. Moreover, communities will contribute labour and local materials within agreed limits.
The primary beneficiaries will be approximately 140,000 people in about 200 target villages selected based on prevailing high poverty rates. Due to the demographic situation, most of the target population will be ethnic minority groups. Since the socio-economic status and opportunities of women are generally much below those of men, special efforts will be made for women of all ages to benefit from the programme - both through mainstreaming of gender within general interventions and through special activities for women. Other beneficiaries will be the general population in target districts and provinces, who will benefit from better governance and government services, as well as numerous government officials whose capacity and working conditions will be improved.
Each target province, district and village will carry out their respective role according to the Lao Government’s decentralisation policy (“Sam Sang”). Most interventions will be carried out through delegation agreements, which will enable the implementing parties to take full responsibility and accountability for the implementation and to use the Lao Government regulations and procedures. The implementation will be supported and coordinated by four Provincial Support Offices and a central Programme Coordination Office staffed with Lao Government personnel, local experts, and international advisers. The programme will also give input to policy dialogue, strategy development and practical guidelines for wider application in Lao PDR based partly on the experiences gained from the practical development work.
Laos – “Nothing ever becomes real until it is experienced”High-level field visit within the scope of LAO/030 Local Development Programme in Laos
The Lao Luxembourg Cooperation Programme will launch the “Local Development Programme for Bokeo, Bolikhamxay, Khammouane and Vientiane Provinces – LAO/030” in May 2017. This 23 million EUR programme will support poverty reduction in more than 200 villages in the poorest districts of the four target provinces. The project is based on the highly successful Bolikhamxay Livelihood Improvement and Governance Project - LAO/021 Project carried out in 2010-16, which contributed substantially to improving living standards in 60 target villages through innovative poverty reduction strategies.
To help the new programme get off to a good start and to create a common understanding of the planned principles and modalities, the Bolikhamxay provincial authorities arranged a four-day field visit to the LAO/021 project area, including discussions with people in eight of the former target villages.
The participants included representatives from the Ministry of Planning and Investment (MPI), the four provincial planning departments of LAO/030, staff from three districts visited, and project staff. Notably, the Director General of MPI’s Planning Department, Madame Phonevanh Outhavong, and the Director-General of LuxDev, Mr Gaston Schwartz, participated in the visit, along with the LuxDev Regional Representative, Mr Olivier Hecquet.
At a practical level, the study tour gave an opportunity to observe some of the tangible results of the LAO/021 project, including village development funds, credit schemes, district micro-finance institutions, and rural infrastructure such as schools, water supply schemes, and bridges. This established a framework for discussions on the innovative principles for decentralisation, participation and empowerment at province, district, and village levels. Through these mechanisms, the LAO/021 project delegated 56% of its budget to Lao implementing partners, used Lao government structures throughout the project and spent 72% of the funds on village-level interventions with a direct poverty focus. Moreover, the project promoted capacity development through learning-by-doing, supported by targeted training, coaching and technical assistance. These modalities will be adopted and further developed in the new LAO/030 programme.
While decentralisation, participation and local democracy are firmly embedded in the Lao government’s policies, their actual application requires further advocacy and practical examples to ensure that the implementing government agencies have full confidence and understanding of their use. In this regard, the field visit offered an excellent opportunity for discussion among the group of composed of both strategic decision makers and practical implementers. The presence of the two Director-Generals gave further weight to the importance of building LAO/030 on shared values and principles, which is essential for executing a highly decentralised and multi-sectorial programme.
The LAO/030 programme will, over the coming 5-6 months, develop action plans to align the support with the local development plans of the four target provinces. Guidelines and initial capacity development will also be carried out in order for practical activities to commence in earnest at the start of the dry season in September, when the remote target villages are accessible and farmers have completed their busy cropping season.