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In Laos, Southeast Asia’s highest inflation forces some to flee, others to get creative
- With a weak kip driving up prices, more Laotians are heading to Thailand for higher wages – or tapping into their entrepreneurial flair
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Su-Lin Tanin Vientiane
In the midst of Laos’ runaway inflation, one enterprising farm manager has transformed her workplace in Vientiane into an unlikely tourist hotspot.
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As well as selling rice and vegetables, Somchit Phankham conducts guided tours and offers courses on cookery and ceramic-making at Panyanivej Organic Farm.
Inflation hit a record 40 per cent in Laos last year and continues to run hot, at around 25.8 per cent as of last month. A weak local currency – the kip – is fuelling elevated prices, after losing around 60 per cent of its value against the US dollar since 2021.
Highly dependent on imports, the Southeast Asian nation has seen prices for basic necessities, from food to transport, surge. Those paid in kip are suffering most, as their incomes fail to keep pace with inflated prices.
Laos’ economic woes have put Somchit in a bind. The workers she relied on to help grow produce on her farm have fled the country, seeking better wages in neighbouring nations.
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“Lacking labour makes it difficult to scale up, our government can’t do much … Thailand is the place that people want to go,” Somchit told This Week in Asia. “I’m more than worried, but what can I do?”
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