Land-locked Laos hopes to achieve its long-term objective of being ‘land-linked’ by 2021 with the scheduled completion of a 414-kilometre medium-speed railway between Boten, on the Laos-China border, and Vientiane, the capital.
While the railway promises to establish Laos as a logistics link between its Asian neighbours, banks and international development agencies worry that the $6bn project, now subsumed under China’s Belt and Road Initiative, will add to Laos’s rising public debt without contributing much to the local economy. Public debt was 61.1% of gross domestic product ($17bn) in 2017 and is expected to hit 65% this year, according to International Monetary Fund estimates.