Australia supports Laos to improve transport and trade connectivity

Australian Ambassador Paul Kelly signs P4I agreement with Government of Laos PDR
Australian Ambassador to the Lao PDR H.E. Paul Kelly and Vice Minister of Public Works and Transport H.E Vilaykham Phosalath sign the agreement on 7 July in Vientiane

The Australian Government is supporting the Government of the Lao PDR to improve transport connectivity, cross-border trade, and logistics along an east-west corridor in northern Laos.

A new Subsidiary Arrangement, under a broader agreement between Australia and Laos on development cooperation, was signed by Australia’s Ambassador to the Lao PDR H.E. Paul Kelly and Vice Minister of Public Works and Transport H.E Vilaykham Phosalath on 7 July in Vientiane. The signing was witnessed by the Minister of Public Works and Transport H.E. Viengsavath Siphandone.

Australia is expected to provide more than A$10 million in support under the arrangement. Assistance will be delivered through the Partnerships for Infrastructure (P4I) initiative in collaboration with the Ministry of Public Works and Transport, Ministry of Planning and Investment, and provincial stakeholders, and delivered as part of the Southeast Asia Regional Economic Corridor and Connectivity (SEARECC) program.

Minister Siphandone said hoped that the project would help attract foreign investment and generate sustainable incomes for Lao people.

“The SEARECC project is a priority for the Ministry of Public Works and Transport and for the Government of the Lao PDR. It will support the national agenda on addressing economic and financial difficulties and the 9th National Socio-Economic Development Plan 2021-2025,” he said.

H.E. Paul Kelly said “improving transport connectivity, planning and cross-border trade will support Laos’ transition from a land-locked to land-linked country, and increase investment and employment opportunities.”

P4I’s assistance builds on Australia’s long-standing engagement in Laos and the region as the two countries celebrate the 70th anniversary of diplomatic relations.

The SEARECC project was approved by the Government of the Lao PDR and the World Bank in May 2022 to improve regional and domestic trade, and climate resilient transport connectivity. The focus is on five northern Lao provinces, including Oudomxay, Luang Namtha, Phongsaly, Luang Prabang, and Xayabouly.

Australia’s assistance through P4I will support the upgrade of cross-border facilities along the Lao PDR’s National Road No.2, a priority project under the Association of Southeast Asian Nations’ (ASEAN) Master Plan on ASEAN Connectivity 2025.

Map of east-west economic corridor along National Road 2 in Laos

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