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This report assesses the quality of Lao PDR’s trade statistics by comparing Lao PDR’s export/import data with its trade partners’ import/export data (mirror data). While the mirror technique is constrained by the fact that partners’ data also can have some problems, it is a useful method to obtain a snapshot of the quality of trade data. First of all, it should be recognized that publicly available Lao PDR statistics compiled by the Ministry of Industry and Commerce (MIC) is not consistent with the Harmonized System (HS) classification. It is advisable that Lao PDR should release the HS classification-based trade data compiled by the Ministry of Finance. The overall quality of Lao PDR’s export data is relatively good compared with its import data. Most differences between Lao PDR’s and trade partners’ trade statistics can be explained by mineral-related and wood-related products. While the exports of minerals and wood-related products are supposed to be effectively managed by the Lao government, there is a possibility that some of those products are exported to neighboring countries outside the control of the Lao government.

by Shintaro Hamanaka and Aiken Tafgar
This report assesses the quality of Lao PDR’s trade statistics by comparing Lao PDR’s export/import data with its trade partners’ import/export data (mirror data). While the mirror technique is constrained by the fact that partners’ data also can have some problems, it is a useful method to obtain a snapshot of the quality of trade data.
First of all, it should be recognized that publicly available Lao PDR statistics compiled by the Ministry of Industry and Commerce (MIC) is not consistent with the Harmonized System (HS)classification. It is advisable that Lao PDR should release the HS classification-based trade data compiled by the Ministry of Finance.
The overall quality of Lao PDR’s export data is relatively good compared with its import data. Most differences between Lao PDR’s and trade partners’ trade statistics can be explained by
mineral-related and wood-related products. While the exports of minerals and wood-related products are supposed to be effectively managed by the Lao government, there is a possibility that some of those products are exported to neighboring countries outside the control of the Lao government.
There is a large concern about the quality of Lao PDR’s import data. The total of Lao PDR’s imports from major trading partners is less than half of the total of those partners’ exports to Lao PDR. Lao PDR’s imports of fuel and gas, vehicle and parts, and construction materials such as steel from Thailand and its imports of vehicle and parts and machinery products from China do not seem to be correctly reflected in Lao PDR’s statistics.
This unsatisfactory quality of import statistics has important policy implications. First, there is a large loss in tariff revenue. If the import value recorded by the Lao Government becomes
comparable to its trade partners’ value of exports to the country, Lao PDR’s tariff revenue will be more than doubled. It should also be recognized that Lao PDR’s trade balance “appears” good when calculated using MIC statistics, while the trade balance seems to be worse based on calculations using the trade partners’ statistics and balance of payment statistics compiled by the Lao Central Bank.Accurate data collection by the border agencies and compilation of quality trade statistics are essential for effective policy making as well as for revenue collection. Just like all other developing countries, Lao PDR also needs to examine and improve the quality of trade statistics to have better trade policies and economic policies, in general.

Contact
Trade, Investment and Innovation Division +66 2 288-1234 [email protected]