Laos Money and Prices

Laos Country Studies index

Laos - Money and Prices

Money and prices

By Decree 14 of March 1988, prices of most goods are no longer set by the government; exceptions include basic utility and mineral prices. Instead, a new system of "unified prices"--free market prices--was instituted. As a result, prices of rationed and subsidized goods such as rice, sugar, cloth, and petroleum increased, and procurement prices were raised by 50 percent to 100 percent.

In addition, in 1988 the wages of state employees, previously paid through coupons redeemable for subsidized goods at state stores, began to be gradually remonetized. Very high inflation rates soon caused a real drop in annual wages, however, and low rates of tax collection gave the government less revenue to spend on wages. As a result, large arrears built up on salaries that are quite small. In 1990 salaries were increased by 83 percent, and arrears began to be paid off, contributing to the increase of 65 percent in government expenditure. Once paid, however, salaries almost immediately go again into arrears. Moreover, the salary increase is not sufficient for state employees to recoup real losses from inflation.

You can read more regarding this subject on the following websites:

Money and costs in Laos - Lonely Planet
Cost of Travel in Laos - Go Backpacking
Cost of Living in Laos. Prices in Laos. Updated Oct 2018
Money and Costs in Laos - Lonely Planet
Laos, World Paper Money, World Banknotes

Laos Country Studies index
Country Studies main page