The Lao People’s Democratic Republic (Lao PDR, or Lao) is surrounded by five countries and does not have access to the sea. It has one of the lowest population densities (23 people/km2) and one of the largest share of rural population (65 percent) in the region. Therefore, the development of an efficient transport system is of paramount importance for regional integration and socio-economic development of the country. In the absence of a railway system, Lao PDR depends primarily on road transport and, to less extent, on river and air transport. Although transport demand is growing, the transport of passengers and goods is constrained by an inadequate transport network that is further limited in coverage by its regular physical condition. The road network carries approximately 98 percent of passenger traffic (passenger-km) and 86 percent of freight traffic (ton-km). The Mekong River and its tributaries carry the substantial remaining share of freight and passenger traffic. Although the volume of airfreight is negligible (0.22 percent), domestic-passenger air transport has reached 2 percent of the demand and plays a crucial role in linking urban areas and otherwise inaccessible parts of the country. | Projects | Data | Maps | | |  |
Roads & Highways Travel by road is the dominant mode of transportation in Lao PDR. The expansion and conservation of the road network are critical to the development of the country. At the end of the 1980s, the road network was in very poor condition and further deteriorated due to lack of funding and appropriate maintenance. The entire Lao PDR road network in 2004 was roughly 31,210 km. It comprised 7,141 km of national roads (23 percent), almost 6,476 km of provincial roads (21 percent), and 17,593 km of other roads which include district, rural, urban, and special roads (56 percent). As of 2004, more than half (56 percent) of the national network was paved and the rest had gravel or earth surfaces. In 2004, about 61 percent of the total national roads were classified as in poor or bad condition and only 16 percent in good condition. Of the provincial roads, 65 percent of the length was in poor condition and in some sections passable only in the dry season. About one third (2,600 km) of the 7,200 km of national roads have been rehabilitated or improved to all weather standard through programs financed by international cooperation.  In the past decade, the government placed high priority, and the largest share of its public investment, towards the development of Lao PDR’s road network. As a result, more than 3,000 km of roads have been rehabilitated or substantially improved.
Traffic volumes on primary roads are typically 250-540 vehicles per day, while traffic on rural roads reaches only 10 percent of these levels. All passenger transport service providers are private except the Vientiane Municipal Transport (buses). The majority of the freight services are private and the balance is composed of state-owned enterprises, which are autonomous and operating on commercial principles. To address the low level and uncertainty in maintenance funding, the government established the Road Maintenance Fund and Road Fund Advisory Board in April 2001. The Road Maintenance Fund provides an enhanced and sustained source for financing the maintenance of the national road network. Back to top Urban Transport  As of 2000 the urban population increased from 13 to 24 percent and continues growing. As urbanization continues, urban transport has become the principal form of public transportation. One of the most dominant modes is the tuk-tuk, a three wheeled, motorized vehicle used for short distances. Because of its convenience, they are preferred over taxis. Taxis focus their activity on key locations such as markets, bus terminals and the Friendship Bridge rather than cruising looking for customers.
Each province has a bus station, situated in the provincial capital. The transport services are provided by small private operators. Back to top Rural Transport  There are 11,356 km of rural roads throughout the country. About 40 percent of villages have no access to road at all.
Rural incomes are low. An average monthly household consumption is less than 1 million kip (US$97) per month in villages with road access and 284,000 kip (US$28) per month in villages without road access. Roads are not the only means of transport, some villages are well-served by river transport. Distance matters too. One village may be a 30-minute walk from a good road, while another may be an hour’s drive. Back to top Railways  Lao PDR does not have a railway network but several studies have been undertaken to determine the feasibility of implementing the first railway link. The development of railways in Lao PDR could be considered as an alternative to the road system, particularly in the north-south corridor, where most of the limited local rail traffic could be generated.
Pending the completion of a feasibility study of the Trans-Asian rail link, no firm conclusions on the viability of the rail options can be drawn. From preliminary studies, it is clear that the rail route through the Lao PDR parallel to NR13 is the shortest link and would minimize operational costs for Thailand-China traffic. However, the capital cost due to the rough terrain, would be high, much of which would fall on the government of Lao PDR. Back to top Inland Waterways The Mekong River and its tributaries, the Nam Ou and Se Kong rivers, flow through the country for over 2,000 km. But rapids, water falls, and low water levels during the dry season reduce the navigable length for river transportation to only 1,300 km. The two sections between the China border – Houeisai – Luang Prabhang have many small rapids that are a barrier to navigation in the dry season. The section between Luang Prabhang and Vientiane is navigable throughout the year but also has difficult sections, even at high water levels. The most easily navigable section is from Vientiane – Thakhek – Savannakhet, where the navigation could be improved at a relatively low cost, although again, there are several dangerous areas. The main barrier along the Mekong is the Khemarat rapids between Savannakhet and Pakse, which completely close the river to dry season transport and severely limit wet season navigability. In the Pakse – Don Deth section navigation is easier only as far as the Cambodia border where the Khone Falls are an impassable obstacle. A 5-km rail line used to operate in colonial times on Khong Island to transship goods between the top and bottom of the falls. There are 21 river port facilities on the Lao PDR side of the river. With the exception of one river port (Kaolia) which is operated privately, all facilities are under the responsibility of the provincial government.  Vessels up to 400 Dead Weight Tons (DWT) can operate year round on the northern section of the Mekong River, while elsewhere operations are limited to barges of 200 DWT or less. In the dry season, most of the river is navigable only by small, shallow-draft, narrow-beam passenger vessels.
Vessels of 300 DWT or greater capacity carry mainly industrial and agricultural products. The main commodities handled are sand, rock, wood products, food grains, steel products, and logs. The majority of the traffic is domestic, but international traffic is important on the upper section among China, Lao, Myanmar and Thailand. Since the national road 13S was improved, river freight traffic between Vientiane and Savannakhet has fallen away, whereas there is still thriving river transport on the section between Vientiane and Luang Prabhang because the more severe terrain influences road transport costs on that section. Back to top Ports and Shipping Lao is landlocked; therefore there is no direct access to the ocean. Currently, Lao PDR uses all existing ports in Vietnam and in Thailand. International trade and transport services depend on neighboring countries for access to seaports. There are a total of 35 water transport companies. Even though there is no seaport, two ocean-going vessels amount to, for both goods and passengers, to about 2,759 units. These vessels are of 1,500 and 3,000 dead weight tonnages. An agreement on commercial navigation in Lanxang-Mekong river between Lao PDR, China, Myanmar and Thailand has been signed. Back to top Air Transport  The Lao Airport Authority (LAA) manages the Vientiane Wattay International Airport. Presently, LAA is responsible for the airports in Vientiane, Luang Prabhang, Pakse, Savannakhet, and Luang Namtha. The remaining minor airports are the responsibility of the provincial governments, although the central government provides annual grants to meet their capital expenditures.
The revenues and expenses of LAA are part of the national budget, and its employees are governed by the terms and conditions applicable to government personnel. The Lao government obtains substantial revenue from international over flight charges due to the high traffic volume in the following air routes that pass over Lao PDR airspace: Bangkok – Hong Kong, Bangkok – Manila, Bangkok – Hanoi, and Hanoi – New Delhi. The airports in Vientiane and Luang Prabhang handle international traffic and provide basic customs, immigration and quarantine services.  It is expected that Pakse will become a regional airport in the near future providing similar services. The fourth significant airport is Savannakhet. All four main airports were recently upgraded. There are ten recognized minor airports located in the provincial capitals and thirty-nine other airports with unpaved runways. Scheduled flights are made in wet season to Xieng Khouang, Oudomxai, Luang Namtha, Houeisai, Xam Nua, Sayaburi, as well as Savannakhet and Pakse. Tahakek and Phongsaly are not serviced by scheduled flights in the wet season due to the constraints of poor conditions of airfields, bad weather, and limited aircraft availability. International services to Lao are operated by Lao Aviation, Thai Airways International, Viet Nam Airlines, and China (Yunnan) Airlines. Domestic services are operated exclusively by Lao Aviation. There is also a privately owned and operated charter helicopter service, used mainly for aerial work and passenger transport to remote-areas.
More Information:
 Â Country Assistance Strategy
 Millennium Development Goals
 Country Website
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