Lao People's Democratic Republic, with a population of 6.9 million people in 2015, has experienced steady economic growth over the past decade. Annual GDP growth has averaged 7.7 percent since the year 2000. However, poverty has declined gradually. It took two decades to halve poverty, from 46 percent in 1992 to 23 percent in 2012. Growth has been driven by hydro-electricity generation and mining, sectors that did not generate many jobs (World Bank, 2015).
The objectives of the project were to assist the borrower in its ongoing efforts to alleviate poverty throughout its territory by: (a) financing community infrastructure activities and other community public capital investment endeavors at the village level; (b) building local capacity at the village level in poor districts to manage public investment planning and implementation; and (c) strengthening the capacity of local institutions to support participatory decision making at the village, kum ban, and district levels.
Reducing poverty, especially in rural areas, has been a top priority for the government. Poverty in rural and remote areas was mostly understood as closely related to isolation and lack of access to basic services, which explains the government’s priority for providing rural infrastructure.
