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The Asian Development Bank (ADB) and the Government of the Lao People’s Democratic Republic (Lao PDR) have signed an agreement for a US$40.5mn grant for the climate-friendly agribusiness value chains sector project to help farmers and agribusinesses develop sustainable and climate-smart agriculture value chains in the country
“Agriculture makes up a significant portion of the Lao PDR economy but the sector’s vulnerability to climate change threatened by floods and droughts puts the country’s development prospect and food security at risk,” said Yasushi Negishi, ADB country director to the Lao PDR.
“This project realises a joint effort between the government of the Lao PDR and ADB to tackle the challenge in order to make the country’s agricultural production more commercialized, sustainable and climate-resilient, while promoting regional integration, cooperation and the competitiveness of agribusiness value chains to support the country’s economic development,” Negishi added.
The project is set to improve crop productivity, diversify agriculture products and enhance climate resilience in the Lao PDR by promoting the use of biofertilisers and organic farming, while disseminating flood- and drought-tolerant crop varieties. It will also support the creation of an enabling policy environment to promote private sector investments through public-private partnerships, contract farming and the formation of joint agricultural production group-agribusiness ventures.
The initiative is in line with the government’s agriculture development strategy to 2025 as it aims to boost the competitiveness of rice value chains in Khammouan, Saravan, and Savannakhet provinces, as well as vegetable value chains in Vientiane Capital, Champasak, and Sekong provinces. This will help the Lao PDR reach its goal of producing agricultural crops and quality rice for domestic and export markets.
At least 100,000 people from 20,000 households in the Lao PDR are expected to benefit from the project, increasing their income by at least 30% and promoting regional cooperation and integration in the Greater Mekong Subregion through harmonization of quality and safety standards and support to regional seed-trading agreements.