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"Investment Promotion Law" allows foreigners to invest in residential land in Lao PDR
On 8 July 2009, the Lao National Assembly passed the Investment Promotion Law, which gives foreign buyers who invest a minimum of 2.5 billion Lao Kip, the right to purchase residential land.
Policymakers stated that the law would provide a "better and fairer" investment climate for both local and foreign businesses, insofar as they would now have equal tax exemptions. In addition, both local and foreign investors would be able to obtain investment permission more efficiently, as part of a "one-stop" service.
The two dissenting assembly members, and one who abstained from voting, expressed concern that foreign land buys would cause the price of land to skyrocket, negatively impacting local, low-income Lao people who sought to become landowners. They also questioned potential government response to foreign investors who later faced business bankruptcy.
Dr. Souvanpheng Bouphanouvong, a member of the drafting committee, responded that these concerns should not impact the ratification of the law.
She defended the law, with the caveat that government agencies still needed to agree on the maximum area and number of land parcels an investor could potentially own beyond the minimum 250 billion Lao kip initial investment, echoing assembly members' earlier concerns that the law was relatively vague in this regard, and would therefore be difficult to enforce.
Most assembly members agreed on the content of the law, but urged the government to correct or simplify several points to make it easier for officials to enforce.
Source: "Foreign Investors Allowed to Purchase Land Use Rights". Vientiane Times, 10 July 2009.
Posted By Naomi Basik at 5:31pm on June 08, 2010
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