Laos has gained the vote of the United States in support of its bid for membership in the World Trade Organisation, which represents a milestone in the country's plans for regional integration.
Lao and US officials reached an agreement to conclude bilateral negotiations on March 14. This represents official US support for Laos to become a member of the WTO, which will enable the landlocked country to more easily access global markets and attract foreign investment.
The agreement was signed in Geneva on the sidelines of the eighth meeting of the Joint WTO Working Group. Minister of Industry and Commerce Dr Nam Vinhaket led a delegation of senior officials attending the event.
According to a press release from the Ministry of Industry and Commerce, representatives of 70 countries were present at the meeting, which was chaired by a Chinese delegate. Representatives from 18 countries urged WTO member countries to accept Laos as a member of the global trade body at the end of this year.
The delegates also called on Laos to accelerate the improvement of legislation as required for membership in WTO. The decision of the US government to back Laos' bid for WTO membership is a strong reflection that the US accepts reforms made to Laos' foreign trade policy. Laos has amended a number of laws relating to investment, business operation and imports and exports, to enable the country to integrate into the world trade community.
Laos is now awaiting the final vote from Ukraine before it can join the WTO. The Lao government hopes to conclude bilateral negotiations with Ukraine in August during the ninth meeting of the joint WTO working group. This would pave the way for Laos to join the WTO at the end of this year.
Laos has so far entered into bilateral trade agreements with China, Japan, the Republic of Korea, Canada, European Union, Chinese Taiwan, Russia, Thailand, Vietnam and the United States.
The government hopes to announce its membership in WTO at the Asia-Europe Meeting Summit to be held in Vientiane in November. M embership is seen as providing a strong platform to attract foreign investment, which is needed to boost econ omic growth and create jobs.
At present, Laos is facing difficulty in attracting foreign direct investment, especially in the non-resource sector, due to limited market access. Only the European Union and a small number of countries offer low import duty on Lao products.
While many Lao businesses support the country's bid for WTO membership, several firms have expressed concern about their ability to compete if the government is able to attract m ore overseas investment.
Low import and export tariffs will also pose challenges for domestic firms in a competitive environment.
The government has urged the private sector to prepare for WTO membership, saying that otherwise they will not be able to survive amid stronger business competition
