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Household Welfare Monitoring in the Lao PDR

A general goods stall at a traditional market in Vientiane, Laos.

Inflation and currency depreciaiton have led to rocketing food prices in Laos 

Photo: World Bank © Philippe Aramburu

New briefSurvey Round 7

The World Bank in the Lao PDR began a series of Rapid Monitoring Phone Surveys in 2020 to monitor the social and economic impacts of COVID-19 on Lao households. Following the end of the pandemic, surveys continue so that data is available for the ongoing economic challenges.

Hopes of a rapid economic recovery after the pandemic have been dimmed by internal and external factors that threaten household living standards. Domestically, currency depreciation and high inflation, resulting from high levels of external debt and low foreign exchange reserves, have led to rising prices, particularly for imported fuel, food, and medicine. Inflation reached 41% percent (year-on-year) in February 2023, while the kip lost 50% of its value over the year up to January 2023.

While economic activities have picked up, rising living costs are having widespread effects, and these ongoing surveys provide insights into the distribution of the impact on Lao families. The first survey was conducted from June to July 2020, when Laos had just exited the first nationwide COVID-19 lockdown. The second round was conducted from February-March 2021, one year into the pandemic. A third round followed from April to May 2021, early in the second lockdown, and a fourth survey carried out October to November 2021, as lockdown measures began to ease. The fifth round occurred April-May 2022, the sixth December to January 2023, and the seventh and latest survey ran from May 29 to June 28, 2023.

This webpage provides links to the results of all survey rounds, plus a report on public service delivery and citizen expectations from the government response to COVID-19, drawing mainly on results from the second survey round. Round 6 was accompanied by a qualitative survey, conducted in late 2022 to provide a better understanding of how rural people perceived the economic and social impacts of both the COVID-19 pandemic and the deteriorating economic situation, particularly spiraling inflation.

The survey questionnaire is designed to cover themes such as access to food staples, food insecurity, employment, the impact of inflation on households, family businesses and farms, economic activities and income, coping mechanisms, and access to social assistance. The results of further rounds of the survey will be published as they become available.

Last Updated: Sep 12, 2023

Latest Key Results

  • Economic instability persists in Laos with the kip continuing to depreciate against foreign currencies. Inflation has eased but remains high, while soaring food prices threaten household livelihoods and food security.
  • Inflation and currency depreciation have resulted in labor market adjustments, pushing wage workers and non-farm businesses to switch to or ramp up farming and agricultural business. Non-farm employment and wage employment declined, while the number of self-employed workers increased.
  • Agricultural activities have steadily increased, with farming offering higher returns and produce substituting for purchased food. About half of crop-producing households grow for sale, with cassava a major cash crop for 35% of crop producers and 43% of low-income crop producers.
  • Workers migrated both domestically and internationally to seek higher wages and better jobs. In June 2023, 11% and 5.3% of Lao households reported having at least one member migrate to another province or country respectively over the past year.
  • Average household income rose by 11.5% between May 2022 and May 2023, failing to keep pace with inflation. Around 54% of households reported unchanged or declining income. These were badly hit by rising living costs. Households which did report rising income saw an average increase of almost 36%, in line with year-on-year inflation. Income grew fastest among urban, low-income, and male-headed households. Female-headed households were hit hardest by economic difficulties: their average income fell by 8%.
  • Around 87% of households reported being somewhat or significantly affected by inflation. To cope, most households grew or foraged more food, switched to cheaper food, or reduced food consumption. Low-income families were most likely to engage in additional income generating activities, sell assets, or borrow.
  • Around 51% of households affected by inflation report reducing education spending. The proportion of children aged 6-17 not enrolled in school rose from 6.5% in December 2022 to 11% in June 2023. By June, around 7% of school-aged children from low-income families had dropped out of school in the previous 12 months, compared to 2.4% from richer families. More than 14% of school-aged children from low-income households were not enrolled in school.
  • Food insecurity worsened from the previous year, especially in urban areas, where the proportion of food insecure households increased from 58% to over 66%.
  • Respondents cited kip depreciation as the most pressing issue for the government to address in June 2023, replacing “rising fuel prices” from the December 2022 survey.

Last Updated: Sep 12, 2023