Learn how the World Bank Group is helping countries with COVID-19 (coronavirus). Find Out

publication July 17, 2020

Lao Biodiversity : A Priority for Resilient Green Growth

World Bank Group


Lao PDR hosts internationally significant biodiversity in its wet evergreen forests, karst landscapes, and montane forest. This endowment is an economic asset if well-managed.

Lao PDR is in one of the 10 most important global biodiversity ecoregions and home to some of the world’s biologically richest and most endangered species. The country includes four ecologically diverse regions: (a) the Northern Highlands, (b) the Annamites Range; (c) the Indo-Chinese karst landscapes; and (d) the Mekong plain. These regions give Lao PDR high levels of biodiversity, and support diverse production systems for food, fiber and medicines, as well as tourism jobs.

The biodiversity endowment is crucial to the Lao economy. The goods and ecosystem services it provides are essential to reduce poverty, secure livelihoods, and drive a greener economic growth model.

But Lao PDR’s biodiversity is in danger. The highest priority threats to the country’s biodiversity values include climate change, illegal logging and wildlife trade, infrastructure development in and around protected areas, and expansion of agriculture and settlements. The Government has established its first three national parks over the last two years.

Sustained investments in biodiversity conservation can be profitable. Revenues and job creation can be on par with those from the extractive industries. Demand for natural attractions and wildlife drives Lao PDR’s tourism, which could grow over the next decade from 4.3% of 2019 GDP and 3.5% of jobs to the global average of approximately 10% of GDP and 10% of jobs. These outcomes would require stronger enabling policies for private investment, concessions, licensing, and conservation.

To benefit the Lao economy and create good jobs, tourism development should be guided to contribute directly to conservation, and retain the unique features that make Lao PDR special. Other sources of revenue from biodiversity can include payments for ecosystem services (PES) such as from sustainable legal timber, patents for pharmaceuticals, and food. About 67 percent of the Lao population are rural and depend on forests to support their livelihoods; over 39 percent of rural family income is from non-timber forest products (NTFPs). As much as 90 percent of the over 1,400 species of wild animals are used as protein sources by local people.

Over 840,000 people in over 1200 villages are situated within or on the boundary of 23 national biodiversity reserves.  Most of these villagers, from a range of ethnic groups, are heavily dependent upon the sustainable use of natural resources within these reserves for their nutrition and livelihoods.

The country’s ongoing transformation to a green economy aims to generate economic growth and poverty reduction through sustainable solutions that boost resilience, create jobs and livelihoods, and protect natural capital and human health. Biodiversity is an important aspect of these green growth ambitions, as articulated in the Government’s National Green Growth Strategy, the 8th National Socio-economic Development Plan (NSEDP-8, 2015–2019), the State of Environment Report series, sector strategies and the 2019 Forestry Law.

The Forestry Law promotes “village forest management” over much of the forestry estate, decentralizing new rights and responsibilities for villages to directly manage forests designated for village use. The law also provides the legal basis for promoting commercial tree plantations on degraded production forest areas, which was reinforced by Prime Minister Decree 247 enacted August 20, 2019, leading to new private sector investment in plantations. These reforms are the basis for sector renewal, poverty reduction, and job creation that can, if managed sustainably, also reduce pressure on protected areas and biodiversity.

Zoonotic diseases are increasingly linked to environmental change and human behavior. The resulting transmission of disease from wildlife to humans is a hidden cost of human economic development and has been increasing. In the last twenty years, Lao PDR and other East Asian countries have experienced SARS, Highly Pathogenic Avian Influenza (HPAI, H5N1 and H7N9), re-emergence of Schistosomiasis, and the 2020 COVID-19 pandemic. Human practices are increasing exposure to wildlife, in two main ways: through legal and illegal trade, and through habitat degradation. There is a need to widen the spectrum of actions to protect human, environmental, and economic health under the “One Health” framework.

The priority objective is to mitigate the main threats to biodiversity while sustainably utilizing biodiversity assets to help propel and protect Lao PDR’s emerging green economy. Key actions to achieve this objective are summarized in three groups: (a) enhancing incentives, including policy, law, and markets; (b) improving access to information, including outreach, extension, and education; and (c) expanding public and private investments in biodiversity values. Lao PDR would benefit from strengthening inter-agency collaboration among law enforcement agencies to curb the illegal wildlife trade.