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Market Snapshot: Laos

Lao People’s Democratic Republic (Lao PDR), often referred to simply as Laos, sits in the midst of Burma, China, Vietnam, Cambodia, and Thailand. Its relatively modest and widely distributed population of 6.6 million (2012) presents a persistent structural challenge for any country-wide reforms or development efforts, including those in the education sector.

But Laos is committed to improving and expanding its education system, and in particular:

  1. Working with international partners to build capacity in Laotian education;
  2. Sending students abroad – especially to receive graduate degrees that would allow them to improve the quality of teaching in the country’s universities.


Laos is a low-income country comprising many ethnic groups with the youngest population in Asia (the median age is 22). It currently ranks 139th on the Human Development Index (HDI), putting it in the same range as Cambodia, Bangladesh, and Bhutan – a rank that just makes it into “medium human development” and out of “low human development.”

But Laos has been on a mission to improve its economy and the standard of living for its people. The International Monetary Fund (IMF) describes the country’s recent growth as “notable” and “among the least volatile in the region over the past decade.” Laos became a member of the World Trade Organization (WTO) in 2013, and it wants to achieve middle-income country status by 2020 with a targeted annual growth rate of 8%.

The country’s recent growth has been impressive, but dependent on a combination of factors that likely make it unsustainable. The IMF considers Lao PDR’s economy to be “overheating” – overly dependent on debt, foreign investment, and natural resource industries. It recommends that “the economy [move] toward macroeconomic and financial stability while building the foundations for broader-based growth.”

The World Bank, meanwhile, considers that Laos can continue to achieve high GDP growth rates if it overcomes a central challenge:

“The key challenge is to enable economic diversification to reduce the reliance on capital-intensive projects that have little impact on employment.”

This is why improving the education system is such a priority: it will promote the development of a broader skills base among the population and thus allow the economy to become more diversified.

Not enough graduate degree holders

Laos’s public higher education system is incredibly new – less than 20 years old, in fact. It consists of:

  • The National University of Laos, the leading university, situated in the capital city of Vientiane;
  • The University of Health Sciences, also located in Vientiane;
  • The regional universities Champasak, Souphanouvong, and Savannakhet, which are smaller and focused on regional labour needs.

There are also close to a dozen other teacher training institutions and roughly 70 other institutions (public and private) granting bachelor degrees.

Laotian universities, however, are very short on professors with graduate degrees. Dr Jane Knight, in her article, “Strengthening higher education in Laos” (International Higher Education, Fall 2013), provides this example:

“Souphanouvong University, located in the north, enrolls 3,700 students – primarily undergraduates. There are 6 faculties, 19 departments, and 320 faculty members – of whom 3 have PhDs, about 60 have master’s degrees, and the rest have undergraduate degrees.”

Dr Knight explains that given the new and limited state of Laos’s higher education system, faculty must go abroad if they want to get graduate degrees. The demand for this is building, given that Laos’s Department of Education has set a target wherein 10% of faculty will have a PhD, and 60% a master’s, leaving only 30% with just an undergraduate degree. Dr Knight adds:

“The enormity of this task, for example, involves a regional university such as Souphanouvong, in which about 83% of the current academic staff have an undergraduate degree, 16% a master’s degree, and .01% have a PhD.”

Dr Knight explains that scholarships are the main way Laotians are able to study abroad, but that eligibility is a challenge. Laotians must be able to speak the language required by the scholarship (e.g., Japanese, Vietnamese, Korean, Chinese, French, or English). The main language spoken by Laotians is Lao, but there are more than 86 individual languages still in use across the country.

There is an opportunity, therefore, for foreign institutions and language providers to provide intensive language training that would allow Laotians to gain the language skills needed for them to complete academic programmes successfully.

The vocational sector

Despite growing enrolments and capacity over the past decade, the vocational training sector in Laos is also lacking qualified instructors with sufficient industry experience, and UNESCO says:

“Lao still lacks a skilled labour force and the popular programmes do not match the needs of the market. Around 40% of all students enrolled in certificate programmes are in ‘low skill programmes’, such as business studies, while high skill labour is in greater demand and pays significantly more.”

As part of its five-year National Social and Economic Development Plan (NSEDP 2011-2015), the government has introduced “The Law on Promotion of Foreign Investment,” which entails a more diversified economic approach. This law highlights the following priority sectors as key areas for labour force development and investment under the plan: agriculture, forestry, handicrafts, environmental protection, biodiversity, health care, infrastructure, manufacturing, and tourism.

Laotians abroad

The most recent UNESCO estimates indicate that between 4,000-5,000 Laotians study abroad annually. Most of them are in Vietnam (2,153) and Thailand (1,344), with smaller numbers in Japan (246), Australia (180), and France (106), and below 100 students in about nine other destinations. This distribution reflects a strong pattern of intra-regional mobility often evidenced in smaller emerging markets.

Challenges and opportunities

Lao PDR has achieved amazing economic growth over the past decade, mostly thanks to its investment in resource-based sectors such as mining and hydropower. But experts point out that such sectors do not generate much employment, and that most Laotians are still involved in rural agricultural industries that demand low skills and that yield little income.

UNESCO notes that the low quality of education – and high level of dropouts – at the primary and secondary levels in Laos is a major obstacle to creating a more skilled and diversified workforce. The organisation says that “system-wide education reforms are necessary to provide a competent workforce for future inclusive and sustained socio-economic development.”

Dr Jane Knight considers cooperation with international institutions a key element in such development. She writes:

“Laos is only one country – nearby Myanmar is another – which needs to collaborate with foreign universities for capacity building, especially staff training, and development. International partnerships need to bring mutual and multiple benefits, and the international cooperation departments of universities in Laos are committed to developing strategies to ensure benefits for all partners.”

An example of an international programme that is helping Laos in its goal to create a more educated, skilled labour force is Erasmus Mundus, the cooperative mobility programme that promotes the European Union as destination for higher education learning around the world. An Erasmus Mundus seminar in 2012 provided the following statistics on Laotians participating in the programme:

“Lao academic institutions have so far been involved in 11 Erasmus Mundus partnership projects since 2004, and more than 100 individuals have received short -and long- term scholarships for studies in Europe.”

Given Laos’s goals and current challenges with educational capacity and quality – combined with its continuing economic growth – it seems likely there are more opportunities on the horizon for foreign educators, both in assisting in the development of the domestic system and in providing new opportunities for Laotian students.

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