This 2013 Article IV Consultation highlights that over the past year, the economy of the Lao Peopleas Democratic Republic has been overheating from expansionary macroeconomic policies. The fiscal deficit is estimated to have widened to 6A½ percent of GDP, mainly fro'm a doubling of public sector employee compensation and higher capital spending. Government liquidity is tight, and wage and other arrears of 2a3 percent of GDP have emerged. Monetary policy has been accommodative, and credit growth remains vigorous. Although medium-term growth prospects remain favorable, based on robust natural resource exports and post-WTO expansion in the nonresource sectors, heightened vulnerabilities have subjected the outlook to considerable uncertainty.Benefits (salary supplements) rose by 140 percent in 2013; this increase was reversed in 2014, bringing benefits back to the level of 2012. ... A World Bank study, published in 2010, found that compensation from the formal salary for civil service workers was well below private sector ... International comparator averages are from 2006 to 2010, calculated from the FAD employment and wages database.
|Title||:||Lao People's Democratic Republic: Staff Report for the 2013 Article IV Consultation|
|Author||:||International Monetary Fund. Asia and Pacific Dept|
|Publisher||:||International Monetary Fund - 2013-12-20|