C HAPTER 1: I NTRODUCTION 1.1 L AO PDR C OUNTRY P ROFILE The Lao Peoples’ Democratic Republic (Lao PDR), located in the heart of the Greater Mekong Sub-Region (GMS), is surrounded by China, Vietnam, Cambodia, Thailand, and Myanmar. Compared to its neighbours, the Lao PDR is smaller in size, with a lower population. Covering a total land area of 236,800 km2, the country is divided into seventeen provinces, and one municipal province of Vientiane Capital. Demographically, the Lao PDR is home to approximately 6.8 million people. It is estimated that 75-80% of population lives in rural areas. The country is prone to seven main hazards:
floods, droughts, storms, landslides, earthquakes, epidemics, and Unexploded Ordinance (UXO). Among these hazards, floods and droughts are the most recurrent hazards (ADPC & UNDP , 2010). The country was severely impacted by floods triggered by Typhoon Ketsana in 2009 and Haima in 2011. These recurrent natural hazards often result in human and economic loss, mainly affecting poor rural communities whose livelihoods depend on subsistence agricultural activities. The Lao PDR has an abundance of natural resources including its mineral deposits and a wealth of forests, which cover more than 40% of its total land surface.
In addition, the Mekong River and its tributaries provide rich water resources which present the potential for power generation and irrigation development. Hydropower potential has been estimated at 18,000 MW; until now, however, only 25 per cent of this potential has been used (MoNRE, 2012). The Lao PDR therefore has great potential for rapid socioeconomic development, even as it must ensure protection of its productive environment and ecosystems in the long term. Nevertheless, the Lao PDR is one of the 48 least developed countries (LDC), with a per capita gross domestic product (GDP) of US$ 1,725Agriculture contributes around 23.15%, Industry 32.42%, and Services 37.87% (MPI, 2014).
The Lao PDR has made significant progress towards poverty alleviation over the past 2 decades with poverty rates declining from 46% in 1992, to 23.24% in 2012/13 (Lao Statistics Bureau & The World Bank, 2014). Although agriculture has been gradually declining in terms of its contribution to GDP over recent years, it still continues to play a major role in the Lao PDR. Nevertheless, the provinces that have a shortage in rice production are surplus maize producers. Besides rice, which is one the important economic crops in the Lao PDR, other important crops include coffee, sugarcane, cassava, sweet potato, and other industrial crops (such as rubber, eucalyptus, and acacia).
According to the GoL & United Nations (2015), the country is on target to achieve the 2