MEDIA RELEASE
Released By:
Downer
I am pleased to announce the Australian Government is assisting the People's Democratic Republic of Laos to manage the impact of the current regional economic crisis.
In response to a request from the Government of Laos, the Australian Government will contribute $250,000 to fund an independent audit of the seven State-owned commercial banks.
The Lao Vice-Minister to the Prime Minister's office, H.E. Mrs Khempheng Pholsena, and I signed a Memorandum of Understanding relating to the assistance to the Lao banking sector today. The Deputy Prime Minister, Tim Fischer, and the Lao Deputy Prime Minister, H.E. Mr Bounnhang Virachith were present at the signing.
Despite a strong commitment to economic reform by the Government of Laos, the country remains one of the poorest in the world. More than 40 per cent of the population live in absolute poverty and one in ten children die before the age of five.
The structure of the Lao economy and its dependence on investment from its Asian neighbours has left the country especially vulnerable to external shocks.
The Australian aid program's assistance for financial administration and other governance issues flows from the recognition that poverty reduction programs work best where governments are getting the economic fundamentals right. We are pleased to be able to provide this additional assistance to Laos during this challenging period in its development.
The audit of banking activities will provide the Lao Government with a clearer picture of the financial position of the banks and the impact of the economic downturn on the finance sector. The audit should also provide Australia and other donors with an understanding of possible future needs in the Laos banking sector.
Media contacts:
Judi Nixon (Mrs Sullivan's office) 0411 287 258
Deborah Nesbitt, (AusAID) 02 6206 4966/0417 683 767