The outlook for the real estate market in Laos is bright and CAMCE
Investment Lao Co Ltd has certainly made the right decision to embark on one of
the largest real estate projects in the country.
The Lao-Chinese joint venture
officially launched the concept plan for their urban development project on the
Don Chan riverfront (known as Vientiane New World) in Vientiane on May 21.
At the launch ceremony, the
company’s management said they would invest more than US$600 million to build
the three phases of the project over a period of six to eight years. The main
features are luxury residences, apartments, a business centre, and shopping and
entertainment centres.
CAMCE is currently building the
first phase of the project, which comprises 50 high class villas to be used by
the Lao government to house heads of state and government attending the 9th
Asia-Europe Meeting Summit in November.
The company plans to kick off
construction of the second and third phases in the near future and hopes to
complete the entire project in 2020.
Despite recording the highest
economic growth rate in the region over the past five years, Laos has a
shortage of high quality residences, business facilities and entertainment
centres to meet the changing needs of development and strong economic growth
over the next five years.
Over the past five years, Laos
has maintained an economic growth rate above 7.5 percent. The government plans
to maintain this rate at a minimum of 8 percent over the next five years, with
mining and hydropower as the main drivers of growth.
“We hired several consultants to
conduct feasibility studies. We finally learnt that this was a great investment
opportunity,” CAMCE Investment Lao Managing Director Mr Yao said during an
exclusive interview with Vientiane Times.
One local rental property company
says the demand for homes and other accommodation in Laos has increased rapidly
over the past five years since the government offered more investment
opportunities for both local and foreign businesses.
Many people have built houses and
apartments for rent and sale. They believe the government will continue to ease
restrictions on foreign investment, which is crucial to increasing the inflow
of foreign businesses and will lead to a surge in demand for accommodation and
office space.
The rental company says there are
about 50,000 foreigners working and living in Laos and these people need better
residences and offices.
Now that Laos has acquired the
nine votes from WTO member countries needed to join the trading body, it expects
to be accepted as a member at the end of this year. Laos is also improving laws
and regulations towards integration into the Asean Economic Community in 2015.
International integration will
help Laos to attract more foreign investment, which will play a significant
role in boosting GDP growth.
As part of efforts to attract
foreign investment, the Lao government has amended the Investment Promotion
Law, to allow foreigners who invest US$500,000 to buy land use rights from the
government for a site measuring 800 square metres.
In the past, investors were
unable to own land use rights, which made it difficult for them to find a
permanent location for offices and residential accommodation.
Mr Yao said he believed a large
number of overseas tourists will visit Laos in the future and that compared to
other Southeast Asian countries, Laos has a lot of potential in tourism.
With its rapid economic progress
and the development of transport, enormous growth can be expected.
Mr Yao said CAMCE saw a promising
future in Laos’ real estate market and he believed it would prove to be a good
investment.
Centrally located among the
Mekong countries, Laos is transforming itself from a landlocked nation into a
land bridge within the region. Thailand has built a railway to Vientiane and
plans to extend the track into the city centre, believing there is a strong
future for logistics in Laos.
China and Laos also plan to build
a high speed railway as part of the Asean-China rail network. Construction of
the railway will make Laos a top business centre. Many economists and business
operators say there is a bright future in store for Laos because of its shared
border with China, which is one of the world’s largest and fastest growing
economies.
One government leader said that
people who plan to trade with China should come to Laos because of the good
investment environment to be found here.
Source: Vientiane Times
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