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Laos’ inflation rate No2 in ASEAN
Laos is almost top of the list of countries recording high inflation rates in the region, sparking more concern about improved standards of living as people struggle with financial hardship.
Year-on-year inflation in Laos rose from 5.04 per cent in November to 5.27 per cent in December last year, the highest figure recorded since August 2020.
The inflation rate in Laos was higher than those reported in all other ASEAN countries, except for Myanmar, which recorded inflation of 6.51 per cent.
In Indonesia, the rate was reported at 1.87 per cent, Cambodia 3.8 per cent, Malaysia 3.2 per cent, Singapore four per cent, Vietnam 1.81 per cent, Thailand 2.17 per cent, and Brunei 1.80 per cent.
The Lao Statistics Bureau cited Trading Economics as saying that the price of goods and services in the US jumped to seven per cent in December 2021 compared to the same period in the previous year.
Meanwhile, inflation in the UK was recorded at 5.4 per cent, while in Germany it was 5.30 per cent, India 5.59 per cent, Russia 8.4 per cent, and Australia 3.5 per cent.
Rising energy prices and supply disruptions have resulted in higher and more broad-based inflation than anticipated, particularly in the US and many emerging markets and developing economies, according to the International Monetary Fund (IMF) World Economic Outlook report.
“Elevated inflation is expected to persist for longer than envisioned in the October WEO, with ongoing supply chain disruptions and high energy prices continuing in 2022,” the IMF stated.
Prices of fossil fuel have almost doubled in the past year, driving up energy costs and causing higher inflation, especially in Europe. Futures markets indicate that oil prices will rise about 12 per cent and natural gas prices about 58 per cent in 2022, according to the IMF.
In Laos, the third increase in fuel prices in January came into effect January 28, with petrol stations across the country again ratcheting up prices.
According to the Ministry of Industry and Commerce, the price of premium grade fuel rose by 590 kip (5.2 US cents) per litre, regular fuel by 710 kip per litre, and diesel by 870 kip per litre.
Motorists in Vientiane now pay 15,370 kip ($1.35) per litre for premium grade fuel, 13,610 kip per litre for regular fuel, and 11,950 kip per litre for diesel.
In December, the price of fuel increased by 38.7 per cent year-on-year, further driving up costs in the communications and transport category, as well as production costs and food prices.
Fuel-related businesses are being affected by an ongoing surge in oil prices in the world market. The Lao government has approved the use of electric vehicles in a bid to minimise fuel imports and reduce harmful gas emissions.
The government is aiming to increase the number of electric vehicles on the country’s streets to one per cent by 2025 and over 30 per cent by 2030.
VIENTIANE TIMES/ASIA NEWS NETWORK