Lao PDR is a least developed country and the only landlocked country in Southeast Asia. The country’s main challenge, at the time of project appraisal, was that it was not very well integrated into the regional and global economy. The lack of a strong regulatory trade framework and a poor investment climate acted as barriers for trade. The Diagnostic Trade Integration Study (DTIS), prepared in 2006, strongly emphasized the need to build competitiveness and increase international and regional integration. It also set out an action matrix of priorities for implementation.
The project was designed to provide resources so that Lao PDR could implement the priorities set out in the trade and integration action matrix.
The project consisted of five components: (i) trade facilitation; (ii) strengthening of frameworks for sanitary and phytosanitary standards and technical barriers to trade; (iii) increasing export competitiveness; (iv) capacity building, trade policy, trade agreements and global opportunities, and (v) strengthening of the National Implementation Unit.
The project was the first coordinated effort among development partners to pool resources around a single approach led by the government.