The Lao and Chinese governments have signed a funding agreement designed to finance a range of projects under the Mekong-Lancang cooperation framework.
Deputy Minister of Foreign Affairs, Mr Thongphan Savanphet, and Chinese Ambassador to Laos, Mr Jiang Zaidong, on Friday signed the agreement on the Mekong-Lancang cooperation special fund for 2018 at the Lao Ministry of Foreign Affairs.
Government officials and representatives from various ministries and state agencies witnessed the signing of the agreement.
According to a media release from the Lao Ministry of Foreign Affairs, the fund for 2018, which the Lao and Chinese governments plan to disburse this year, is worth about US$4.5 million and will be spent on 21 projects.
The Lao government has assigned the ministries of Foreign Affairs, Education and Sports, Post and Telecommunications, Public Works and Transport, Science and Technology, and Agriculture and Forestry to carry out these cooperation projects.
The Mekong-Lancang cooperation special fund was established during the first Mekong-Lancang cooperation summit held in Sanya in China’s Hainan province, which was attended by leaders from the six Mekong countries of China, Cambodia, Laos, Myanmar, Thailand, and Vietnam.
During this summit, China promised US$1.5 billion in preferential loans and a credit line of US$10 billion to enable Cambodia, Laos, Myanmar, Thailand and Vietnam to build infrastructure.
The envisaged projects include construction of a comprehensive connecting network comprising r
ailways, highways, waterways, ports and air transport.
In 2017, Laos received US$3 million from China under the Mekong-Lancang cooperation special fund to carry out 13 projects.
At the 4th Mekong-Lancang Cooperation Foreign Ministers’ Meeting held in Luang Prabang at the end of last year, China approved the special fund to enable the Mekong countries to carry out 138 projects.
Under this initiative, Laos will receive about US$4.5 million to implement 21 projects.
China wants to enhance its ties with the Mekong nations to expand trade and economic cooperation within the Mekong region. The Mekong River, which is known as the Lancang in China, is the common link between the six countries.
China is the biggest trading partner of Cambodia, Myanmar, Thailand and Vietnam, and the biggest source of investment in Cambodia, Laos and Myanmar. China’s bilateral trade with the five nations reached US$193.9 billion in 2015.