Laos central bank vows to resolve high inflation rate

Lao central bank on Tuesday vowed to apply strict measures against high inflation rates, which led to severe shortage of fuel and depreciation of the national currency kip.

Loas central bank governor, Sonexay Sithphaxay said the central bank wants to ease the situation, which was further exacerbated by the COVID-19 pandemic and some regional conflicts.

"The central bank is rolling out measures to tighten the management of money flow and ensure there is sufficient monetary circulation within the economy to maintain socio-economic development.''

Sithphaxay, said the central bank would further cooperate with the Ministry of Public Security and other government agencies to crack down on illegal foreign currency trading, which causes public distress and disturb the market.

He said the central bank would strengthen the management of foreign currency and monetary supply mechanisms in relation to importing essential goods that cannot be produced in Laos.

The most important and costly of these was fuel, which must be obtained in sufficient quantities to meet the needs of the public and enable the economy to function normally, Sonexay added.

In order to get sufficient foreign currency for fuel importers, the government was partnering with commercial banks to seek new sources of funds.

He said the government was also looking at improving the management of revenue sourced from other countries to bring in much more foreign currency.