Logistical improvements are part of the Laotian government’s strategic development plan, Viengsavath Siphandone, director-general of the Transport Department, said at the launch of Savan Logistics Company.

The government has set aside a massive budget for developing and improving infrastructure in order to link with neighbouring countries, Viengsavath said.

“For such legislation,” he explained, “we successfully signed bilateral agreements with almost all the neighbouring countries including Cambodia, Vietnam and Thailand, but we are still in negotiations with Myanmar. “Moreover, we have signed contracts in collaboration with multilateral parties such as Laos-Vietnam-Thailand, Laos-Vietnam-Cambodia, the Greater Mekong Sub-Regional Cross-Border Transport Agreement and the Asean Framework Agreement.

“In actual implementation, we only practise bilateral agreements of transport contracts; the majority of them are related to renting transport vehicles from neighbouring countries, because Laotian vehicles lack the capability to transport over long distances to the seaports of neighbouring countries,” Viengsavath said.

“Previous development and improvement of infrastructure, especially roads, bridges, seaports, and so on, have aimed to facilitate transport, travel and trade only to some extent. It still does not endorse and guarantee such a policy of transforming Laos completely from a landlocked to a land-linked country.”

Because Laos has infrastructure in place without providing services in logistics, the logistics operators in the regions and neighbouring countries gain the most benefits in this area while Laos reaps only minor benefits but has a massive and costly responsibility for maintenance of the transport infrastructure, it has been noted.

To address the situation, the ministry adopted a strategic development plan for transport and logistics in Laos, and this plan was officially approved by the government last year, Viengsavath said.

Laos has also become a member of United Nations Economic and Social Commission for Asia Pacific’s Intergovernmental Agreement on Dry Ports, which sets aside nine locations that are assigned for international logistics parks in the country.

They are Huoayxai in Bokeo, Nateuy in Luang Namtha, Xay in Oudomxay, Luang Prabang province, Thanalaeng in Vientiane, Lak Xao in Borikhamxay, Thakhaek in Khammuan, Xeno in Savannakhet, and Vangtao in Champassak.

Logistics improvements are under way in those nine locations, including Thanalaeng, which is in negotiations for investment collaborations with Japan under a private-public partnership, while Savannakhet recently opened for service, Viengsavath said.

Implementing these logistics services in line with the strategic development plan for transport and logistics in Laos as well as various international agreements is urgently important to consolidate goods-cargo distribution, he said. This will integrate transport services for both inbound and outbound cargoes and lower transport costs and help solve illegal parking of container trucks along public roads, which damages road conditions and road safety.