Lao PDR Poverty Reduction Fund will Further Improve Rural Roads, Water Systems and Agriculture Livelihoods with World Bank Support

May 24, 2016

WASHINGTON, May 24, 2016 — The World Bank’s Board of Executive Directors today approved $30 million in new financing for Lao PDR’s Poverty Reduction Fund (PRF). This is the third phase of World Bank funding for the Fund, one of the Lao PDR Government’s main vehicles to address rural poverty.

The new resources will help the Fund continue to improve the rural poor’s access to basic infrastructure such as rural roads and safe drinking water in 10 provinces, and help improve agricultural livelihoods in 150 villages.

“The Poverty Reduction Fund helps improve the lives of poor families in villages all across Lao PDR with improved basic roads, sanitation, irrigation, village schools and health facilities,” said Mr. Ulrich Zachau, Country Director of the World Bank for Southeast Asia. “We are pleased to help fund the expansion of this successful program and we welcome in particular the focus on improved nutrition, which is so critical to help all Lao children realize their potential and lead good productive lives.”

The new World Bank financing comes from the International Development Association (IDA), the World Bank’s fund for the poorest. It will allow the PRF to scale up some of the results from the earlier phases of the project. In the new phase, the majority of project beneficiaries will be poor ethnic minority groups who live in remote mountainous areas with limited access to infrastructure.

Despite rapid economic growth in the past few decades, poverty remains high in Lao PDR, especially in rural areas and among ethnic groups. Many Lao citizens who escaped poverty in the recent past have fallen back into poverty again. About 19 percent of Lao citizens are undernourished, and 44 percent of children below the age of five are stunted.

The 8th National Socio-Economic Development Plan of Lao PDR recognizes that improving access to basic education infrastructure, safe water and roads is critical to address rural poverty.

The PRF was established by the Lao PDR Government in 2002. 

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