Theoretically, abundant natural resources could promote growth through more investment in infrastructure, health care and human capital development. However, various empirical studies have illustrated that resource-rich countries fail in accelerating growth compared with resource-poor countries. There are various factors for low growth in resource-rich countries, but one of the most important factors is the so-called â€œDutch diseaseâ€. Laos is a small, open Least Developed Country (LDC) in Southeast Asia. Laos was ranked 130th out of 177 countries. 34 percent of the population lives below the poverty line. However, it is a resource-rich economy with over 570 mineral deposits identified. As a result, since 2003, Laos has experienced massive foreign capital inflows in terms of Foreign Direct Investment (FDI) in the mining and hydropower sectors. Resource sectors contributed about 2.5% of GDP during 2000-2007; resource sector revenues account for 18% of total tax revenue (2007). On the other hand, resource sectors also have a negative impact on economy through appreciation of the real exchange rate and declining non-resource sectors. Despite the significant potential for both positive and negative impacts from resource booms on the Lao economy, there is a gap in the research on this issue in Laos. Therefore, the main objective of this study is to quantify the possible impacts of resource booms on nation-wide economy and poverty using a Computable General Equilibrium (CGE) model. The simulations of macroeconomic adjustment policies will also be investigated in order to evaluate ways to escape Dutch disease.
Project leader: Phouphet Kyophilavong
No journal publications.
|Resource Boom, Growth and Poverty in Laos; What Can We Learn From Other Countries and Policy Simulations?||2013-07-15||1348.02KB||0||0|
|Resource Boom, Growth and Poverty in Laos: what can we learn from other countries and policy simulations?||2012-11-27||1339.34KB||0||0|
|Resource Boom, Growth and Poverty in Laos||2010-09-24||120KB||0||0|
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