Transcript Slide 1

Investment Policy of
Lao PDR
Thamma PHETVIXAY
Deputy Director General
Investment Promotion Department (IPD)
Ministry of Planning and Investment, Lao PDR
Outline:
I. New Features of Investment
Promotion Law
II. Investment Zones and
Incentives
III. Investment Advantages
IV. Investment Procedures
V. Things Investors should
known
IPD
NEW FEATURES OF
INVESTMENT PROMOTION
LAW
( No.02/NA, 8 JULY 2009)
1. Unifying Domestic and
Foreign Investment Laws
• No discrimination between the
foreign and domestic
investors, esp. investment
incentives
4
2.Terms of Investment
• No terms of investment of
general business activities
(Article 20)
• Terms of the concession
projects is up to 99 years
(Article 28)
5
3. Approval procedures for domestic
and foreign investment in
general/opened activities (new law)
Follow the
Enterprise Law
6
4. One Stop Service
One Stop Services:
• Ministry of Industry and Commerce;
• Ministry of Planning and
Investment;
• Special Development Zone
5. Special Economic Zones
• Government strongly encourage
investors to develop:
- Special economic zone
- Export Processing zone
- Industrial Park
- Tourism zone
- Duty free zone
- ICT Zone, and
- Others zone
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6. Rights of land use for residential
purpose
• Investor will be granted rights on
purchasing rights of land use for their
residential purpose (Article 58), if the
following conditions are satisfied:
- Taking of registered capital (in cash) at lease
US$500,000
- Land is belong to government
- Certificate on location of investment which is
issued by local authority
- Terms of land use is equivalent to term of
investment
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7. Access to credits
• Both foreign and domestic
investors can access to credits
at commercial banks and
financial institutions in Lao
PDR and abroad (Article 53)
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Investment
Promotion Zones
and Incentives
Investment Promotion Zoning
Zone 1:
Mountainous,
plateau zones
with no
economic
infrastructure.
Zone II: Mountainous,
plateau zones with a
moderate level of
economic
infrastructure.
Zone III: Mountainous, plateau zones
with good economic infrastructure.
Investment
promotion zoning
-Zone I
-Zone II
-Zone III
Investment Promotion Sectors
•
Incentives for promotion sectors:
1.
2.
- Promotion activities will be determined by the Gov. in
3 different level based on priority activities of the Gov.,
activities related to poverty reduction, . . .
For example:
Agro-processing businesses;
Industrial processing ( New products; Using Hi
technology products)
Human resource development and public health;
Infrastructure Development
Services
3.
4.
5.
Incentive on Corporate Profit tax
Promoted
Sectors
Level
1
1
10
2
6
3
4
1
8
2
4
3
2
1
4
2
2
3
1
Industry
Agricultur
e
Period of
exempt (yrs)
Zone
2
Service
3
Other incentives:
Exemption of import duties and
taxes on raw materials and
capital equipment;
Exemption of export duty on
export products;
10% personal income tax on
expatriate employees;
Granting additional
incentives
• Exempt land lease
or land concession
Zone 1 = 15 years
Zone 2 = 10 years
Education &
Healthcare
sectors
Zone 3 = 3 years
• Provide additional 5
years for corporate
profit tax exempt
Investment
Advantages
Advantages:
Comparative Advantages:
– Natural Resources endowments
– Large Area of Fertile Agricultural Land
– Varieties of Tourism Development Sites
– Virtually no damaging natural disaster
– Government vision : Land – linked
Competitive Advantages:
– Social and Politically Stability
– High Security (Low Crime Rate)
– Low investment Costs (Labor, Land, Utilities. . . )
– GSP Privileges given from 42 countries
– Investment bilateral Agreements with 27 countries
– In the process of joining WTO
POTENTIAL SECTORS
 Energy
 Mining
 Agribusiness
 Tourism
 Construction
Material
 Light industry
 Service
Investment
Procedures
Investment Activities
Three types of Investment Activities:
1.General/Opened Activities
2. Concession Activities : Electricity,
Mining, Land concession, Airline
businesses, Telecommunication,
Insurances, Financial Institution…
3.Special Economic Zones and Specific
Economic Zones
Ministry/ Dept. of
Industry and
Commerce
Ministry/Dept. of
Planning and
Investment
-General/opened • Concession
activities
activities
- Branch of
• Representaforeign entity
tive office
Specific
Economic
Zone
Investment
in specific
economic
zone
-Enterprise registration license -Enterprise registration
-Concession license
-Representative office license
license
Approval procedures for domestic and foreign investment
in general/opened activities (new law)
Investor proposes to
register
Ministry/Department of Industry and Commerce
Business not fall into
controlled list
Issue enterprise
registration
certificate within
10 working days
Business that fall into
controlled list
Request for comments from
Ministry/Department
concerned within 10 w. days
Issue enterprise registration
certificate within 3 working
days
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Approval procedures for investment in
concession (new law)
1
Investor
IPD receive the application for appraisal and
submit
technically approval on the investment
investment
2
application
Giving guidance for investor for preparing necessary documents
OSS meeting
3
Propose to Government or provincial authorities for approval
4
consideration and suggest investor to submit the quarantee money
Signing the agreement, issue the concession certificate
5
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Things Investors should
known
• Laws and Regulations of
Lao PDR
• Brokerages
• Lao cultures
Contact Address:
Investment Promotion Department
Ministry of Planning and Investment
Souphanouvong Road, Vientiane 01001, Lao PDR
Tel: (856-21) 222 690
Fax: (856-21) 215 491
Website:www.investlaos.gov.la
Thank You
For Your Attention